The main reason to exercise a financial option early would be to realize a(n):
A) dividend payment.
B) fixed exercise price.
C) underlying asset.
D) distribution.

Question

Quizplus · Accepted Answer

The main reason to exercise a financial option early would be to realize a dividend payment. If a stock pays a dividend, it can affect the value of the option. If the option holder exercises the option before the ex-dividend date, they can receive the dividend.

The Main Reason to Exercise a Financial Option Early Would