ANNAPURNA OPTION
A structure of an option contract originating from the "mountain range" series of exotic options. The Annapurna options caters a combination of a fixed coupon rate and attendance in the equity gains of a given basket of securities. The coupon rate is based on when the group's worst-performing stock fell under a predetermined level. The more elongated time it takes for the group's worst-performing stock to hit the predetermined low point, the higher will be the coupon payment for the investor. The equity participation rate ( in the given securities) also increases as the Annapurna option exists longer prior to the payout phase.
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