EFTA Document EFTA01353518

Credit default options are binary options in that they have a specified, all•or•nothing cash settlement amount. Credit default options, however, have additional unique characteristics. For example. credit default options have no exercise price and cannot be in the money and have no intrinsic value. The discussion of these terms in Chapter I and/or Chapter II of the Booklet is therefore inapplicable to credit default options. In addition, a credit default option is automatically exercise