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Derivatives and Risk Management, 1st Edition
book

Derivatives and Risk Management, 1st Edition

by Sundaram Janakiramanan
May 2024
Intermediate to advanced content levelIntermediate to advanced
542 pages
27h 26m
English
Pearson India
Content preview from Derivatives and Risk Management, 1st Edition
Exotic Options 479
C H A P T E R S U M M A R Y
Regular European and American options, also known as plain
vanilla options, have a single exercise price, and the pay-o
structure is based on the relationship between the exercise
price of the option and the spot price of the underlying asset
on the exercise date.
In exotic options, the pay-o structure can be determined on
the basis of the occurrence of various events during the life of
the option and thus the pay-o is di erent from that of plain
vanilla options.
Exotic options are generally custom-made to suit the needs of
the parties and are non-negotiable.
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Publisher Resources

ISBN: 9781299447547Publisher Website