lookback
noun1
Alternative Alternative form of look-back.
2
Business, Finance Often A kind of exotic option whose payoff depends on the optimal (maximum or minimum) underlying asset's price occurring over the life of the option.
- Another interesting path-dependent option is the lookback option. A lookback call allows you to buy the asset at the lowest price and a lookback put allows you to sell it at the highest price attained during the life of the option.2009, Don M. Chance, Robert Edwin Brooks, An Introduction to Derivatives and Risk Management:
- The principle of a lookback option is to give the investor the maximum payoff based on perfect hindsight.2011, Frans de Weert, Exotic Options Trading: