Knock-in Event

This Issue in United States

Knock-in Event

Concept of Knock-in Event in the context of derivatives contract, by the International Swaps and Derivatives Association (ISDA): An addition of a knock-in event to an option will result in the option not being active unless a certain price (knock-in price) is reached by the underlying. This will have the effect of reducing the option premium, (see barrier option).

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See Also

• Derivatives Contract