How To Fix T8231 - Option valuation: Normal model only supported for IR options

T8231 - Overview

• Message type: E = Error

• Message class: T8 - Analysis system evaluations

• Message number: 231

• Message text: Option valuation: Normal model only supported for IR options

What causes this issue?

The normal distribution model is only supported for options on interest
rates:
Swaptions
Caps/Floors
Interest rate guarantees

System Response

The option price is not calculated.

How to fix this error?

Make sure that the option is valuated using a different model. You do
this either
By changing the valuation model in the valuation rule &V1& or
By assigning another valuation rule to the option.

Procedure for System Administrators

The system issues an error message and will not allow you to continue with this transaction until the error is resolved.

Error message extract from SAP system. Copyright SAP SE.

T8231 - Details

• The SAP error message T8231, which states "Option valuation: Normal model only supported for IR options," typically occurs in the context of financial instruments, particularly when dealing with options in the SAP system. This error indicates that the valuation method being used is not compatible with the type of option you are trying to evaluate.
  
  Cause:
  
  Model Mismatch: The error arises when a valuation model that is designed for interest rate (IR) options is being applied to a different type of option (e.g., equity options, commodity options, etc.).
  
  Configuration Issues: There may be a misconfiguration in the settings for the option valuation in the SAP system, leading to the system attempting to use the normal model for an unsupported option type.
  Data Entry Errors: Incorrect data entry or selection of the option type during the valuation process can also trigger this error.
  
  
  Solution:
  
  Check Option Type: Ensure that the option you are trying to value is