Weekly 1-Year Options: Similar to MidCurve options, but expire in 1 weeks. These options, with a time to expiration of three months to one year, have as their underlying instrument Eurodollar futures one, two, three, four or five years out on the yield curve. MidCurve Options: Eurodollar Mid-Curve options are short-dated American-style options on long-dated Eurodollar futures. This investment alignment allows the investor to hedge against risk due to the offsetting nature of the securities.Ĭrack Spread Average Price Options: Similar to Crack Spreads above, but use Average Price options. An average price put is considered an exotic option, since the payoff depends on the average price of the underlying over a period of time, as opposed to a straight put, the value of which depends on the price of the underlying asset at any point in time.Ĭrack Spreads: The spread created in commodity markets by purchasing oil options and offsetting the position by selling gasoline and heating oil options. Conversely, if the average price of the underlying asset is below the strike price of such a put, the payoff to the option buyer is positive and is the difference between the strike price and the average price. If the average price of the underlying asset over a specified time period exceeds the strike price of the average price put, the payoff to the option buyer is zero. New Crop Options: Options with an expiration date after harvest has been completed.ĬSO Consecutive: A calendar Spread where the first leg is the front month and the second leg is the next available month.Īverage Price Options: A type of option where the payoff depends on the difference between the strike price and the average price of the underlying asset. Wednesday Weekly Options: A weekly option that expires on Wednesday rather than Friday. Monday Weekly Options: A weekly option that expires on Monday rather than Friday. Weekly European Options: Same as Weekly Options above but can only be exercised at the maturity date (Friday).
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