An Asian call option gives its holder the right to ________.
A) buy the underlying asset at the exercise price on or before the expiration date
B) buy the underlying asset at a price determined by the average stock price during some specified portion of the option's life
C) sell the underlying asset at the exercise price on or before the expiration date
D) sell the underlying asset at a price determined by the average stock price during some specified portion of the option's life

Question

Quizplus · Accepted Answer

An Asian call option gives the holder the right to buy the underlying asset at a price determined by the average stock price during some specified portion of the option's life. This type of option is different from a European call option, which allows the holder to exercise the option only on the expiration date. Therefore, B is the correct answer.

An Asian Call Option Gives Its Holder the Right to ________