Average Price Call

DEFINITION of 'Average Price Call'

A type of option where the payoff is either zero or the amount by which the average price of the asset exceeds the strike.

BREAKING DOWN 'Average Price Call'

The average price of these exotic options is derived with a timeframe that is determined at the creation of the option.

RELATED TERMS
  1. Average Price Put

    A type of option where the payoff depends on the difference between ...
  2. Asset-or-Nothing Put Option

    An option payoff that is equal to the asset's price if the asset ...
  3. Cash-Or-Nothing Call

    An exotic option whose payoff is a predetermined amount (sometimes ...
  4. Exotic Option

    An option that differs from common American or European options ...
  5. Average Strike Option

    A type of Asian option in which the strike price is based on ...
  6. Asset-Or-Nothing Call Option

    A derivative security for which there is no payoff unless the ...
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RELATED FAQS
  1. What's the difference between a regular option and an exotic option?

    Before learning about exotic options, you should have a fairly good understanding of regular options. Both types of options ... Read Answer >>
  2. How does the term 'in the money' describe the moneyness of an option?

    Find out what in the money means about the moneyness of call or put options and what it indicates about the relationship ... Read Answer >>
  3. What is the difference between in the money and out of the money?

    Learn about how the difference between in the money and out of the money options is determined by the relationship between ... Read Answer >>
  4. How do I set a strike price for an option?

    Learn about the strike price of an option and how to set a strike price for call and put options depending on risk tolerance ... Read Answer >>
  5. How do speculators profit from options?

    As a quick summary, options are financial derivatives that give their holders the right to buy or sell a specific asset by ... Read Answer >>
  6. Can an option have a negative strike price?

    The simple answer is that, at least when it comes to exchange traded options, an option can't have a negative strike price ... Read Answer >>
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