Difference between revisions of "Strike Price"
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| − | ''' | + | == What is Strike Price? == |
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| + | The '''strike price''', also known as the exercise price, is the price at which the holder of a financial instrument, such as an option or a warrant, can buy or sell the underlying asset. In the case of a call option, the strike price is the price at which the holder of the option can buy the underlying asset. In the case of a put option, the strike price is the price at which the holder of the option can sell the underlying asset. | ||
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| + | The strike price is an important factor in determining the value of an option or warrant. If the market price of the underlying asset is above the strike price of a call option, the option is considered to be in the money and has value. If the market price is below the strike price of a put option, the option is considered to be in the money and has value. If the market price is equal to the strike price, the option is considered to be at the money and has no intrinsic value. | ||
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| + | The strike price is usually set at the time the option or warrant is issued and remains fixed throughout the life of the instrument. | ||
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| + | == See Also == | ||
| + | *[[IT Strategy (Information Technology Strategy)]] | ||
| + | *[[IT Governance]] | ||
| + | *[[Enterprise Architecture]] | ||
| + | *[[Chief Information Officer (CIO)]] | ||
| + | *[[IT Sourcing (Information Technology Sourcing)]] | ||
| + | *[[IT Operations (Information Technology Operations)]] | ||
| + | *[[E-Strategy]] | ||
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| + | == References == | ||
| + | <references /> | ||
Latest revision as of 16:05, 8 March 2024
What is Strike Price?
The strike price, also known as the exercise price, is the price at which the holder of a financial instrument, such as an option or a warrant, can buy or sell the underlying asset. In the case of a call option, the strike price is the price at which the holder of the option can buy the underlying asset. In the case of a put option, the strike price is the price at which the holder of the option can sell the underlying asset.
The strike price is an important factor in determining the value of an option or warrant. If the market price of the underlying asset is above the strike price of a call option, the option is considered to be in the money and has value. If the market price is below the strike price of a put option, the option is considered to be in the money and has value. If the market price is equal to the strike price, the option is considered to be at the money and has no intrinsic value.
The strike price is usually set at the time the option or warrant is issued and remains fixed throughout the life of the instrument.
See Also
- IT Strategy (Information Technology Strategy)
- IT Governance
- Enterprise Architecture
- Chief Information Officer (CIO)
- IT Sourcing (Information Technology Sourcing)
- IT Operations (Information Technology Operations)
- E-Strategy