American option

Type of option that may be exercised at any time before, and up to, its expiration date. European option, in comparison, can be exercised only on its expiration date. The payoff of an American option (like that of a European option) depends on the average price of the underlying asset as on a specific date and (unlike that of an Asian option) not over a period. These option names, however, refer only to the types of options and not to any geographical area. Also called American-style option.