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Dividend Swap

An over-the-counter swap where two counterparties exchange a stream of future cash flows at set dates in the future over...

Lookalike Option

An over-the-counter option that is cash-settled based on the settlement price of a similar exchange-traded futures contract on a certain...

Long Put Strip

An option trading strategy which is constructed by buying from three and up to eight put options. In this strategy,...

Low Outlay Geared Option

A low premium option (specifically a put) which allows the holder to participate in an upside movement with a gradually...

Long-Dated Option

An option which expires after more than a year (e.g. 1, 2 or 3 years). Traders buy long-dated options with...

Dividend Protection

Adjusting the strike price of an OTC option by the amount of dividends paid on the underlying asset/ stock. This...

Step Option

A path-dependent option which is parameterized by a finite knock-in (knock-out) rate. The payoff at expiration is equal to that...

Log Contract

An exotic option (specifically a single-payout option) that makes payments based on the logarithm of the price of its underlying...

Dark Spread Option

An option on the dark spread, i.e., on the gross margin from electricity generated using coal. More specifically, this option...

Automatic Exercise

A clause in an option contract providing that the contract will be exercised automatically by the clearing firm at expiration...