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European Style Option

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Definition of 'European Style Option'

European (style) options can be exercised only on the exercise date and not before that. Compare to American Style Option. Even though you can only exercise the option on the exercise/expiration date this does not mean that you cannot sell the option, assuming that the option that you own is a transferable option such as an exchange traded option.

The distinction between European and American style options is not a great one as most options are closed out before expiration by selling them. Most options are Fungibles.

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