EXOTICS Barrier

This calculator uses the Barrier option pricing model to calculate the fair value of European-style call and put options with a barrier condition.

The BarrierBS function in FinTools XL is designed for pricing barrier options, which are exotic options where the payoff depends on whether the underlying asset's price breaches a preset barrier level during its life.

Underlying Price: The current price of the underlying asset.

Boundary Price: The price at which the option is knocked out or knocked in.

Exercise Price: The price at which the asset can be purchased if a call or sold if a put. Also known as the strike price.

Time to Expiration: Time to expiration expressed as a % of a year, ie. 0.5 is 1/2 of a year

Volatility: The annualized volatility of the underlying asset. Volatility is the standard deviation of the "relative" underlying price change.

Interest Rate: The risk-free interest rate based on the tenor to expiration.

Yield Factor: The percentage yield from the underlying asset.

Rebate Amount: The amount that is rebated back to the option holder in the event of a knockout.

Market Option Price: This input is only required when calculating implied volatility and implied strike.