Exercise styles — concept

About this app

European, American, Bermudan — the same tree, three exercise windows (tinted columns). Warm rings show where early exercise happens; the price comparison shows European ≤ Bermudan ≤ American including the early-exercise premium. Debunks “in the money ⇒ exercise immediately” — and for a call without dividends early exercise never pays.

Subject: Financial derivatives

More from Financial derivatives

• Asian option — details
• Asian option — concept
• Exercise styles — details
• Binomial tree — details
• Binomial tree — concept
• Cap / floor / collar — concept
• Credit default swap — details
• Credit default swap — concept

A VisuApp by heyprof: interactive, free in your browser, no sign-up. What is a VisuApp? · All apps