EXERCISE

exercise: translation

The action taken by the holder of a call option if he wishes to purchase the underlying futures contract or by the holder of a put option if he wishes to sell the underlying futures contract. Chicago Board of Trade glossary

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When a call purchaser takes delivery of the underlying long futures position, or when a put purchaser takes delivery of the underlying short futures position. Only option buyers may "exercise" their options; option sellers have a passive position. The CENTER ONLINE Futures Glossary

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The implementation or use of a contractual right, for example, a call option holder's purchase of the underlying security. American Banker Glossary

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To implement the right of the holder of an option to buy ( in the case of a call) or sell ( in the case of a put) the underlying security. Bloomberg Financial Dictionary

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To invoke the right granted under the terms of an options contract to buy or sell the underlying futures contract. The option holder ( long) is the one who exercises the option. Call holders exercise to buy the underlying future, while put holders exercise to sell the underlying future.The short option position is assigned exercise by the exchange by a process of random selection. CME Clearing removes the option and creates the futures positions on the firms' books on the day of exercise. Chicago Mercantile Exchange Glossary

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The process by which an option holder takes up his right to buy ( call ( call option)) or sell ( put ( put option)) the asset underlying ( underlying asset) the option contract. Dresdner Kleinwort Wasserstein financial glossary

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The use of the right to purchase the underlying instrument by the holder of a call, or to sell the underlying instrument by the holder of a put. Upon exercise of an option on a futures contract, an option seller will be assigned (at the exercise price) a futures position opposite to the position acquired by the option buyer. Upon exercise of an option on equity shares, an option seller will be required to deliver shares at the exercise price ( in the case of a call option) or purchase shares at the exercise price ( in the case of a put option). Exercise of an option on an equity-index contract, either a call or a put, results in a cash settlement based on the difference between the exercise price and the index at the time of exercise. Exchange Handbook Glossary

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The process by which an option holder has the right to buy or sell. LIFFE

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The process of using the right to buy or sell the underlying at the specified price. London Stock Exchange Glossary

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1. To use the rights given by the warrants, e.g. to buy or sell the underlying security for call and put warrants, respectively. The exercise procedure is detailed in the Pricing Supplement.

2. To make use of the rights granted to the owner of a warrant. In the case of a call, the warrant owner buys the underlying. In the case of a put, the warrant owner sells the underlying. NYSE Euronext Glossary

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exercise ex‧er‧cise [ˈeksəsaɪz ǁ -ər-] verb [transitive]

1. formal exercise power/influence/a right etc to use your power, influence or a right that you have:

• Shareholders were encourage to exercise their right to vote.

2. FINANCE exercise an option to buy the property mentioned in an option:

• The seller is likely to exercise the option if the market value of the property is above the repurchase price.

— exercise noun [singular] :

• Shares will be allotted or transferred within 28 days of the exercise of an option.

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To make use of the right possessed by the holder of an option. The option holder notifies the writer that they wish to exercise or assign their option. The writer is then obliged to the holder on the terms already agreed - they must buy or sell the underlying asset.

► See also Assign.

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Ⅰ.

exercise UK US /ˈeksəsaɪz/ verb

► [I or T] to do physical activities to make your body strong and healthy: »This product is aimed at people who exercise on a regular basis.

► [T] to use something such as a right or choice: exercise a right/power/choice »The landlord may exercise his right to review the rent.
»exercise power/control/influence (over sth)

● exercise an option — Cf. exercise an option

Ⅱ.

exercise UK US • /ˈeksəsaɪz/ noun

► [C or U] physical activity that you do to make your body strong and healthy: do/take exercise »The office has a gym for those who like to do exercise in their lunch hour.
»There are many types of equipment out there in the exercise market.
»exercise equipment/machines

► [C] an action or actions intended to improve something or make something happen: »10,000 scientists and businessmen took part in an exercise to identify technology trends.
»The outing was arranged by the firm as part of a team-building exercise.
»a cost-cutting exercise
»a brainstorming exercise

► [U] FORMAL the use of something such as a right, choice, or power: »The document sets out guidelines on the exercise of voting rights.

► [U] FORMAL the act of doing a particular job: »Many journalists have lost their lives in the exercise of their profession.

● the exercise of an option — Cf. the exercise of an option

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