when using a fixed strike lookback option the strike price is set or fixed at purchase similar to most other types of option trades unlike other options however at the time of exercise the most beneficial price of the underlying asset over the life of the contract is used instead of the current market price in the case of a call the option holder can review the price history and choose to exercise at the point of highest return potential 
for a put option the holder may execute at the asset s lowest price point to realize the greatest gain the option contract settles at the selected past market price and against the fixed strike 