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Early Exercise (assignment)
The exercise or assignment of an option contract before its expiration date. This will only be possible with American options which would be automatically exercised on the strike/barrier being touched.

European Exercise
A feature of an option that stipulates that the option may only be exercised at its expiration. Therefore, there can be no early assignment with this type of option.

The process whereby a stock’s price is reduced when a dividend is paid. The ex-dividend date (ex-date) is the date on which the price reduction takes place. Investors who own stock on the ex-date will receive the dividend, and those who are short stock must pay out the dividend.

Equity Options
Options on shares of an individual common stock.  See also Non-Equity Option.

European-Style Options
An option contract that may be exercised only during a specified period of time just prior to its expiration.

When the option holder determines to convert their options position into the underlying asset at the strike, aka, exercise price.  An unlikely event in the case of binary options since nearly all binary options are  cash based. See American options.

Exercise price
The exercise price is the same as the Strike Price.

Expected Return
A rather mathematical analysis involving the payout of the option and the probability of the option paying out.

Expiration cycle
An expiration cycle relates to the times and dates on which options on a particular underlying security expire.

Expiration date
The time and/or day on which an option contract becomes void. See also Automatic Exercise.

Expiration time
The time of day by which all exercise notices must be received on the expiration date.


See ‘Expiration Date’ above.