For a reset option type 2, the strike is reset in a similar way as a reset option 1. That is, the strike is reset to the asset price at a predetermined future time, if the asset price is below (above) the initial strike price for a call (put). The payoff for such a reset call is max(S - X, 0), and max(X - S, 0) for a put, where X is equal to the original strike X...
![WMT: Reset Strike Options-Type 2 (Gray Whaley) [Loxx]](https://s3.tradingview.com/y/yrtqazX9_mid.png "Reset Strike Options-Type 2 (Gray Whaley) [Loxx]")
