Business and Personal Finance Dictionary

# A B C D E F G H I J K L M N O P Q R S T U V W X Y Z 

• VULNERABLE OPTION
  
  1. "[An option] on a defaultable instrument, subject also to their issuer's default risk. Ex: A put issued by a shaky bank on a corporate bond issued by a third party." 2. An option "subject to the additional risk that the writer of the [option] might default."
  
  Back