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back fee

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Back Fee
Voted Barron's Best Online Broker 4 Years in a row! Trade Options Now.
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Financial Dictionary

Back Fee

The premium charged upon the second term or portion of a compound option.

Investopedia Commentary

In other words, the back fee is the fee paid by the owner of a compound option to the owner of the underlying option when the compound option is exercised.

Related Links

Options Basics Tutorial

See also: Compound Option, Front Fee

Investopedia.com. Copyright © 1999-2005 - All rights reserved. Owned and Operated by Investopedia Inc.
Cite This Source
Back Fee
Voted Barron's Best Online Broker 4 Years in a row! Trade Options Now.
www.optionsXpress.com
IDrive - Online Backup
Real Time Backup for your critical data at only $4.95/Month!
www.idrive.com
Financial Dictionary

back fee

Payment made by the owner of a compound option to the owner of the underlying option when the compound option is exercised. Compare front fee.

Wall Street Words: An A to Z Guide to Investment Terms by David L. Scott.
Copyright © 2003. Published by Houghton Mifflin.
Cite This Source
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