Called Away

AAA

DEFINITION of 'Called Away'

A term used to describe the elimination of a contract due to the obligation of delivery. This occurs if an option is exercised, if a redeemable bond is called before maturity or if a short position held in a security requires delivery.

INVESTOPEDIA EXPLAINS 'Called Away'

For example, if an investor has written a call option and the holder of the option exercises it, then the option has been "called away" and the writer has to complete his/her obligation to the contract.

When an investment is "called away", it can result in an investor missing out on potential gains in the underlying asset.

RELATED TERMS
  1. Call

    1. The period of time between the opening and closing of some ...
  2. Callable Bond

    A bond that can be redeemed by the issuer prior to its maturity. ...
  3. Writer

    The seller of an option who collects the premium payment from ...
  4. Exercise

    To put into effect the right specified in a contract. In options ...
  5. Maturity Date

    The date on which the principal amount of a note, draft, acceptance ...
  6. Bond

    A debt investment in which an investor loans money to an entity ...
Related Articles
  1. Callable Bonds: Leading A Double Life
    Options & Futures

    Callable Bonds: Leading A Double Life

  2. Options Basics Tutorial
    Options & Futures

    Options Basics Tutorial

  3. Solving Mixed Options Problems On The ...
    Options & Futures

    Solving Mixed Options Problems On The ...

  4. Applying Binary Options To Equity Markets
    Options & Futures

    Applying Binary Options To Equity Markets

Hot Definitions
  1. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
  2. Accelerated Depreciation

    Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years ...
  3. Call Risk

    The risk, faced by a holder of a callable bond, that a bond issuer will take advantage of the callable bond feature and redeem ...
  4. Parity Price

    When the price of an asset is directly linked to another price. Examples of parity price are: 1. Convertibles - the price ...
  5. Earnings Multiplier

    An adjustment made to a company's P/E ratio that takes into account current interest rates. The earnings multiplier is used ...
  6. Macroeconomics

    The field of economics that studies the behavior of the aggregate economy. Macroeconomics examines economy-wide phenomena ...
Trading Center