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Definition of 'Mountain Range Options'
A family of exotic options based on multiple underlying securities. Mountain range options were first created by French securities firm Société Générale in the late 1990s. These options blend some of the key characteristics of basket-style or rainbow options (which have more than one underlying security or asset) and range options, which have multiyear time ranges.
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Investopedia explains 'Mountain Range Options'
The price of a mountain range option is based on multiple variables, the most important of which is the correlations between the individual securities in the basket. Some options have discrete payout levels (e.g., double the investment, triple the investment) if certain performance metrics are hit by the underlying securities while the option is in effect.
Types of mountain range options include Altiplano options, Annapurna options, Everest options, Atlas options and Himalayan options. They are traded over-the-counter (OTC), typically by private banks and institutional investors such as hedge funds.
The difficulties in determining the fair market value for these exotic options makes standard formulas (like the Black-Scholes method for vanilla options) nearly impossible to apply. Certain types of mountain range options have recalculation or sampling dates, at which the best- or worst-performing stocks from the basket are removed. Thus, holders of these options must constantly re-evaluate the parameters affecting their current value. Effects such as volatility skew, which is found in most options, can be even more pronounced within mountain range options.
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Search results for 'Mountain Range Options'
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http://stocks.investopedia.com/stock-analysis/2012/Range-Resources-Turns-In-Solid-2011-RRC-CLR-BBG-CHK0127.aspx
... mostly in the Rocky Mountain area uses a natural gas price of $3.93 per MMBtu. This
is based on the Colorado Interstate Gas price in 2011. Range Resources also ...
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http://stocks.investopedia.com/stock-analysis/2010/Small-Med-Tech-Names-You-Should-Know-ICUI-IRIS-LMNX-HSP-ILMN0415.aspx
... pipeline. It has also been beset by delays and disappointments, and the
result is a stock chart that resembles a mountain range. ...
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http://stocks.investopedia.com/stock-analysis/2011/Argentina-Is-A-Resource-Investors-Dream-ARGT-CRESY-AGRO-YPF-TGS-GTE1024.aspx
... Finally, the Andes Mountain Range provide Argentina with rich mineral deposits
including copper, tin, lead, zinc, gold, silver and uranium. ...
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http://financialedge.investopedia.com/financial-edge/0911/Top-5-Unique-Winter-Vacations.aspx
... the US$189 per night price range, with everything ... ski resorts Christmas Mountain
and Cascade Mountain are nearby. ... you can enjoy amazing dining options, a wide ...
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http://stocks.investopedia.com/stock-analysis/2010/Energy-Mergers--Acquisitions-In-Comeback-XTO-XOM-CHK-TOT-RRC0217.aspx
... The valuation range was very wide among these deals, although the small sample ... Rocky
Mountain assets traded for $20.87 per BOE of proved reserves, and Gulf ...
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http://stocks.investopedia.com/stock-analysis/2010/Newfield-Explorations-Oil-Investments-Payoff-NFX-BEXP-ROSE-ECA1026.aspx
... area is Monument Butte, a relatively unknown oil field in the Rocky Mountain area. ...
Wells here range in cost from $700,000 to $900,000 and can be drilled in an ...
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http://stocks.investopedia.com/stock-analysis/2012/Cabot-Oil--Gas-Conquers-The-Energy-Patch-In-2011-COG-EP-BHP-RRC-WMB-KMI0104.aspx
... Factor Three Cabot Oil & Gas divested the company's Rocky Mountain assets for $285
million ... growth for 2011 to as much as 46%, up from the previous range of 34 ...
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http://stocks.investopedia.com/stock-analysis/2010/Noble-Energy-Moves-Forward-With-Israeli-Project-NBL1101.aspx
... IN PICTURES: 6 Ways To Make Better Options Trades. ... 2010 production to be in a range
from 214,000 to ... Niobrara Shale properties in the Rocky Mountain area, and ...
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http://stocks.investopedia.com/stock-analysis/2009/Let-Commodity-Cutbacks-Begin-EOG-CHK-BTU-CNX0305.aspx
... and are now in the $4 per Mmbtu (million british thermal units) range in certain ...
of $1 per mcf (thousand cubic feet) at its wells in the Rocky Mountain region. ...
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http://stocks.investopedia.com/stock-analysis/2011/Caribous-Compelling-Growth-Prospects-CBOU-GMCR-KFT-SJM-SLE0509.aspx
... side and is seeing growth along with the popularity of Green Mountain Coffee Roaster's ...
sales growth between 7% and 9% and reported earnings in a range of 58 ...
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