American Option

Posted in Finance, Accounting and Economics Terms, Total Reads: 916

Definition: American Option

The name of this term is deceiving; on the contrary, American Option refers to an option with the provision that it can be exercised at any time until its maturity date.

On the other hand, a European option is one which can be exercised only at that particular date.

As a matter of fact, American options are the ones which are majorly traded on exchanges and as they provide much more flexibility, they are more valuable.

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