An option that pays a fixed amount of cash is called cash-or-nothing, and one that pays the value of the underlying asset itself at expiry is called asset-or-nothing. Consider a hypothetical example in which a cash-or-nothing call has a strike price of 100 yen and a payout of 10 yen. It pays 10 yen whether the price at expiry is 101 yen or 130 yen, and nothing at 100 yen or below. A call option with the same strike price would instead pay 1 yen and 30 yen, rising with the price.
Digital option
- Japanese
- デジタル・オプション
- Also known as
- Binary option
- Last reviewed
- September 25, 2026
This is a draft, shown for review before publication.
A digital option is an option whose payoff is either a fixed amount or nothing, depending only on whether the price of the underlying asset at expiry is above the strike price (below it for a put). The amount does not grow with how far the price ends above the strike price.