DEFINITION of 'Aggregate Exercise Price'

The strike price of a put or call option multiplied by its contract size. Aggregate exercise prices are used to determine the dollar amount required should the option be exercised.

BREAKING DOWN 'Aggregate Exercise Price'

For example, if options on ABC co. have a contract size of 100 shares and a strike price of $10, then the aggregate exercise price will be $1000 ($10 * 100 shares). In the case of a bond option, the exercise price is multiplied by the face value of the underlying bond.

RELATED TERMS
  1. Exercise Price

    The price at which the underlying security can be purchased (call ...
  2. American Option

    An option that can be exercised anytime during its life. American ...
  3. Call On A Call

    A type of compound option in which the investor has the right ...
  4. Capped Option

    A capped option limits, or caps, the maximum profit for the holder ...
  5. Strike Price

    The price at which a specific derivative contract can be exercised. ...
  6. European Option

    An option that can only be exercised at the end of its life, ...
Related Articles
  1. Financial Advisor

    The Best Strategies to Manage Your Stock Options

    We look at strategies to help manage taxes and the exercise of incentive and non-qualified stock options.
  2. Trading

    Dividends, Interest Rates and Their Effect on Stock Options

    Learn how analyzing dividends and interest rates is crucial to knowing when to exercise early.
  3. Trading

    Three Ways to Profit Using Put Options

    A brief overview of how to profit from using put options in your portfolio.
  4. Trading

    Three Ways to Profit Using Call Options

    A brief overview of how to provide from using call options in your portfolio.
  5. Managing Wealth

    Get The Most Out Of Employee Stock Options

    Stock options can be lucrative for employees who know how to avoid unnecessary taxes.
  6. Investing

    What are Options Contracts?

    An explanation of options contracts, call options and put options.
  7. Trading

    How to Trade Options on Government Bonds

    A look at trading options on debt instruments, like U.S. Treasury bonds and other government securities.
  8. Trading

    Options Hazards That Can Bruise Your Portfolio

    Learn the top three risks and how they can affect you on either side of an options trade.
  9. Trading

    Understanding Bull Spread Option Strategies

    Bull spread option strategies, such as a bull call spread strategy, are hedging strategies for traders to take a bullish view while reducing risk.
RELATED FAQS
  1. How do I change my strike price once the trade has been placed already?

    Learn how the strike prices for call and put options work, and understand how different types of options can be exercised ... Read Answer >>
  2. 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 >>
  3. What are the SEC regulations on exercising stock options?

    Learn how the SEC and IRS regulate employee stock options, including the exercise of options and the sale of options, and ... Read Answer >>
  4. When holding an option through expiration date, are you automatically paid any profits, ...

    Holding an option through the expiration date without selling does not automatically guarantee you profits, but it might ... Read Answer >>
Hot Definitions
  1. Limit Order

    An order placed with a brokerage to buy or sell a set number of shares at a specified price or better.
  2. Current Ratio

    The current ratio is a liquidity ratio that measures a company's ability to pay short-term and long-term obligations.
  3. Return on Investment (ROI)

    Return on Investment (ROI) is a performance measure used to evaluate the efficiency of an investment or compare the efficiency ...
  4. Interest Coverage Ratio

    The interest coverage ratio is a debt ratio and profitability ratio used to determine how easily a company can pay interest ...
  5. Cash Conversion Cycle - CCC

    Cash conversion cycle (CCC) is a metric that expresses the length of time, in days, that it takes for a company to convert ...
  6. Inverted Yield Curve

    An inverted yield curve is the interest rate environment in which long-term debt instruments have a lower yield than short-term ...
Trading Center