Perpetual Option - XPO

A non-standard financial option with no fixed maturity and no exercise limit. While the life of a standard option can vary from a few days to several years, a perpetual option (XPO) can be exercised at any time. Perpetual options are considered an American option; European options can be exercised only on the option’s maturity date.

Also referred to as "non-expiring options" or "expirationless options."

For investors, perpetual options represent the highest ratio of possible risk/reward payoff compared to existing financial products. Perpetual options are viewed as “plain vanilla” options. For many investors they represent an advantage over other instruments (where dividends and/or voting rights are not a high priority) because the strike price on a perpetual option enables the holder to choose the buy or sell price point instead of having to select a singular stock price. In addition, XPOs can be preferable to standard options because they eliminate the expiration risk.


Investment dictionary. . 2012.

Look at other dictionaries:

  • Option-adjusted spread — (OAS) is the flat spread which has to be added to the treasury yield curve in a pricing model (that accounts for embedded options) to discount a security payment to match its market price. OAS is hence model dependent. This concept can be applied …   Wikipedia

  • perpetual lease — noun : a lease renewable forever at the lessee s option …   Useful english dictionary

  • Russian Option — A lookback option without an expiry date. This type of option can have either an American or a Mid Atlantic settlement. A Russian option is a perpetual lookback option. This is another synthetic product for investors looking to adjust risk …   Investment dictionary

  • Appanage — An apanage or appanage is the grant of an estate, titles, offices, or other things of value to the younger male children of a sovereign, who under the system of primogeniture would otherwise have no inheritance. The system was widespread in much… …   Wikipedia

  • Charleston Daily Mail — Type Daily newspaper Format Broadsheet Owner The Daily Gazette Company Publisher Nanya Friend …   Wikipedia

  • Crown lands of France — The crown lands, crown estate, royal domain or (in French) domaine royal (from demesne) of France refers to the lands, fiefs and rights directly possessed by the kings of France.[1] While the term eventually came to refer to a territorial unit,… …   Wikipedia

  • Gore Vidal — Vidal in New York City to discuss his 2009 book, Gore Vidal: Snapshots in History s Glare Born Eugene Luther Gore Vidal October 3, 1925 (1925 10 03) (age 86) …   Wikipedia

  • Chantry — For other uses, see Chantry (disambiguation). Chantry is the English term for a fund established to pay for a priest to celebrate sung Masses for a specified purpose, generally for the soul of the deceased donor. Chantries were endowed with lands …   Wikipedia

  • Annuity (European financial arrangements) — An annuity can be defined as a contract which provides an income stream in return for an initial payment.Immediate annuityAn immediate annuity is an annuity for which the income stream begins at a time after the initial payment which is less than …   Wikipedia

  • chess — chess1 /ches/, n. a game played by two persons, each with 16 pieces, on a chessboard. [1150 1200; ME < OF esches, pl. of eschec CHECK1] chess2 /ches/, n., pl. chess, chesses. one of the planks forming the roadway of a floating bridge. [1425 75;… …   Universalium

  • Natural resource economics — Economics …   Wikipedia

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”

We are using cookies for the best presentation of our site. Continuing to use this site, you agree with this.