You are here: HomeOptionsDefinition and CharacteristicsWhy is the Lifetime of the Option Important??

Why is the Lifetime of the Option Important??

The lifetime is the period of time during which the holder has the right to exercise the option against the seller.

An option is called "American-style" if the holder is able to exercise the right at any time during the option's lifetime.

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A European-style option is only exercisable at the end of the lifetime.

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The terms „European-style“ and “American –style” do not refer to the location where the options can be traded.

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