exercise price (strike price)
- The fixed cost outlined in an option contract wherein the related futures contract, security, or commodity transfers ownership from the seller to the buyer
- Since the current market price is lower than the exercise price, the option holder chose not to exercise the option.
- The exercise price of the futures contract was considered fair by both parties involved.
- In the event the market value drops below the strike price, the option contract may likely be left unexercised.