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Vanilla Option

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Definition of 'Vanilla Option'

A Vanilla Option is an option with no unusual or special features or restrictions. It will have a standard strike price, standard expiration date and standard terms.

The term vanilla option came about when options because the underlying contracts for further derivatives. For example, options on options. Options became more and more complex with more and more varying terms that a term had to be created to refer to the original option which because a Vanilla Option.

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