KnockVariant Struct Reference

Knock in/out variant. More...

Public Types
enum	Enum { Undefined = 0, Down = 1, Up = 2 }

Detailed Description

Knock in/out variant.

A Knock In option is an option that comes alive, i.e. Knocks In, when a certain barrier is reached. If the barrier is never reached, the option will automatically expire worthless, as without reaching the barrier, it never exists. If the barrier is reached, the option knocks in and its final value will depend on where the spot rate settles in relation to the strike. They are therefore substantially cheaper than ordinary options. With the Knockout feature, if at any time up to and including the maturity, the Knockout level is reached the option will expire worthless.