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Please use this identifier to cite or link to this item: http://hdl.handle.net/1959.13/927778

Title: Valuing coins as the sum of the underlying asset and a perpetual American put option
Author/Creator: Easton, Stephen
Institution: The University of Newcastle. Faculty of Business & Law, Newcastle Business School
Description: Coins may be valued as the sum of the value of the component metals, plus a perpetual American put option with an exercise price equal to the face value. For widely circulated coins, the value of the component metals is sufficiently low compared to the face value that immediate exercise is optimal. For bullion coins the put option has only a trivial value. However, in some cases the value of the component metals is sufficiently close to the face value that the put option has a non-trivial time value. An example is provided of the 1966 Australian 50 cent coin.
Relation: Global Finance Journal Vol. 17, Issue 3, p. 397- 402
Publisher Link: http://dx.doi.org/10.1016/j.gfj.2006.08.001
Date: 2007
Publisher: Elsevier
Keyword(s): perpetual American put option; coins
Resource Type: journal article
Identifier: http://hdl.handle.net/1959.13/927778
Identifier: ISSN:1044-0283

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