American Style Options can be exercised at any time prior to expiry. Most Stock Options are American Style, but Index Options are generally European Style which means they can only be exercised on the expiry date (see the European Style definition for more details).
Note that the terms 'European' and 'American' have no relationship with the geographical location of the venue where a given instrument is traded, so it is possible to have American Style Options on European stocks.
Contributed by: Ralph Windsor
Note that the terms 'European' and 'American' have no relationship with the geographical location of the venue where a given instrument is traded, so it is possible to have American Style Options on European stocks.
Related Directory Entries
Featured Video
American vs. European Style Options
Simple explanation of the difference between American and European Style Options.
View Option Alpha in Options Market Glossary Directory
External Links
Option Stylehttps://en.wikipedia.org/wiki/Option_style
Wikipedia article on Option Styles. Covers more than European and American definitions and includes some more obscure styles also.
American Stylehttp://www.investopedia.com/terms/a/americanoption.asp
Investopedia definition of American Style Options.
Option Styles: American Vs. Europeanhttp://www.learningmarkets.com/option-styles-american-vs-european/
Detailed explanation of American vs European style options.
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