SIE practice questionmediumOptions — American vs European Style
What is the key difference between American-style and European-style options?
- AAmerican options can be exercised at any time before expiration; European options can only be exercised at expiration✓ Correct answer
- BAmerican options can only be traded on U.S. exchanges
- CEuropean options are always more expensive than American options
- DAmerican options have longer expiration periods than European options
Explanation
Why A — American options can be exercised at any time before expiration; European options can only be exercised at expiration
American-style options can be exercised at any time up to and including the expiration date. European-style options can only be exercised at expiration; the labels refer to exercise style, not geography.
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