Flex option - Financial definition
Financial acronyms
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Concise definition of the term flex option
An exchange-traded option that does not have the standard terms of listed options. The seller and the buyer can negotiate various terms, such as exercise style, strike price, expiration date, settlement type or others.
Comprehensive definition of the term flex option
Flex (short for flexible) options were offered for the first time on the Chicago Board Options Exchange on equities and equity indices, but are now available on a number of exchanges.
They have been created in response to the growing OTC market for options. The exchanges seek to make flex options attractive by providing price discovery, an active secondary market, daily valuations and the virtual elimination of counterparty risk. Flex options represent a hybrid between listed options and OTC-traded options.