Average rate call option
An Asian option (or average value option) is a special type of option contract. For Asian options the payoff is determined by the average underlying price over some pre-set period of time. For Asian options the payoff is determined by the average underlying price over some pre-set period of time. In this part we will learn how to calculate single option (call or put) profit or loss for a given underlying price. This is the basic building block that will allow us to calculate profit or loss for positions composed of multiple options , draw payoff diagrams in Excel , and calculate risk-reward ratios and break-even points .