Exercise value
Exercise value is a value that is equal to the current price of the stock (underlying the option) minus the strike price of the option.
Definitions
According to Financial Management Theory and Practice by Eugene F. Brigham and Michael C. Ehrhardt (13th edition),
- Exercise value. Equal to the current price of the stock (underlying the option) minus the strike price of the option.
According to Fundamentals of Financial Management by Eugene F. Brigham and Joel F. Houston (15th edition),
- Exercise value. For a call option, it is the difference between the current stock price and the option's strike price.
Related concepts
- Financial management. A combination of enterprise efforts undertaken in order to procure and utilize monetary resources of the enterprise.
