Q608
Type of option that can be exercised before date of expiration as well as on expiry date is classified as
A.
Australian option
B.
American option
AnswerC.
European option
D.
Canadian option
Answer: Option B
Solution
Answer: Option B
Solution:
Type of option that can be exercised before date of expiration as well as on expiry date is classified as American option. An American option is a version of an options contract that allows holders to exercise the option rights at any time before and including the day of expiration. Another version or style of option execution is the European option that allows execution only on the day of expiration.