Lookback Strike Terms
Definition
Lookback Strike Terms. Strike terms in which the value of some observed variable (the underlying) is looked back at during some period, typically a period ending in the maturity of the Option, and the payoff is determined by comparing the agreed strike with the value of this variable.
The payoff may either be the difference between a fixed, pre-agreed Strike Price and the observable, or the difference between the best or worst valuable of the observable and the value of that same observable at maturity of the contract (these are the Fixed and Floating lookback terms respectively). This (per review at Nordea) is not mutually exclusive with the terms for Fixed Strike and Resettable Strike, that is, either of those kinds of strike terms may apply, and Lookback strike terms may also apply.
Disclaimer
This entry annotates a FIBO Ontology Class. FIBO is a trademark and the FIBO Ontology is copyright of the EDM Council, released under the MIT Open Source License. There is no guarantee that the content of this page will remain aligned with, or correctly interprets, the concepts covered by the FIBO ontology.
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