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What Is the ‘Optimal Stopping Time’ Problem in Option Pricing?

The optimal stopping time problem is the challenge of determining the best time to exercise an American option. Since the option can be exercised at any time before expiration, the holder must decide at each moment whether to exercise now or wait.

The optimal stopping time is the point that maximizes the option's expected payoff.

Can an American Option Ever Be Optimal to Exercise Early?
How Can a Smart Contract Handle the Exercise of an American-Style Option, Which Can Be Exercised Any Time before Expiration?
How Does the Presence of a ‘Dividend’ (Or Staking Reward) Change the Optimal Exercise Strategy?
What Are the Limitations of Using Monte Carlo Simulation for Pricing American Options?