## Fwd Start Option

**is a direct subtype of Exotic Option with functions Fwd Start Option Functions, keys Fwd Start Option keys and example object FwdStartOpt that represents a forward start Vanilla Option contract with vanilla payoff.**

*Fwd Start Option*The effective strike is set to a preagreed percentage - called moneyness - of the underlying price quoted at some fixed future date.

This is equivalent to having a forward start option, the strike of which is set at the future date when the forward option starts.

There exist 2 payoff variations compatible with this setting:

The first is the vanilla payoff given by the formula

*max[ S(T) - mS(t*) , 0 ]*where

**is the underlying value at the exercise time**

*S(T)***,**

*T***is the underlying value at the forward start time**

*S(t*)***, when the strike is set and**

*t****is the moneyness, as agreed in the option contract.**

*m*The second is the performance payoff given by the formula

*max[ S(T)/S(t*) - m , 0 ]*The following features are currently not supported by QuantLib:

Bermudan exercise style, discrete dividends/storage costs.

The pricing methodology is specified in Model[Fwd Start Option]