ADVANCE OPTION
\ɐdvˈans ˈɒpʃən], \ɐdvˈans ˈɒpʃən], \ɐ_d_v_ˈa_n_s ˈɒ_p_ʃ_ə_n]\
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A shortterm LINE OF CREDIT granted by an UNDERWRITER to an issuer of securities that can be drawn if the underwriter cannot successfully place the securities. The advance option thus guarantees the issuer access to shortterm funds regardless of the relative success of the NEW ISSUE.
By Henry Campbell Black
