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  • February 13, 2023
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American-Style Swaption

A swaption (swap option) that can be exercised anytime the holder finds favorable or suitable during the options life. Once the option goes in the money, the seller (writer) gets exposed to the risk that the option’s exercise will be looming. And as it becomes in the money (profit position), the holder will contemplate exercising it at some point without missing out this opportunity.


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