Assuming no rebates upon knock-out, a down-and-out call option is worth less than a vanilla call
A) When the knock-out barrier lies above the current stock price.
B) When the knock-out barrier lies below the current stock price.
C) When the knock-out barrier is far from the strike price.
D) Always.

Question

Quizplus · Accepted Answer

The Answer of Assuming no rebates upon knock-out, a down-and-out call option is worth less than a vanilla call
A) When the knock-out barrier lies above the current stock price.
B) When the knock-out barrier lies below the current stock price.
C) When the knock-out barrier is far from the strike price.
D) Always.

Assuming No Rebates Upon Knock-Out, a Down-And-Out Call Option Is