Currency option

Currency option

An option to buy or sell a foreign currency.

Currency Option

An option contract in which the underlying asset is a foreign currency. The option gives the holder the right but not the obligation to buy (for a call) or sell (for a put) a set amount of the currency at a certain exchange rate on or before the expiration date. They are largely used when international corporations wish to hedge against the possibility of adverse movements in foreign exchange rates.
References in periodicals archive ?
To mitigate the currency risk, the borrower must earn the specific currency in order to have that currency option.
I would urge the Commission not to waste a minute of their time considering a currency option that is dead.
com)-- “We design this currency option trading service for traders and investors who are considered passive in their trading activities but want to control their risk as well as want to benefit from unlimited profit potential,” said Charles McKenna, the Chief Advisor for Global Currency Options.
1NUMBER If you have a guaranteed order or cash flow to protect, there are tools such as a forward trade or a currency option which let you book your cash in advance for a future date.
Thus an unrealized loss existing on the date that a foreign currency option was transferred to a charity was disallowed.
K, pound exchange rate and decides to manage that risk by purchasing a foreign currency option directly from a U.
A currency option, like a forward contract, allows you to exchange one currency for another on a future date.
has added currency option trading from GFInet's FEN ICS product, a move that Currenex says will "deepen its market information, research and analytics by making available to its members FENICS' FX option price analysis and data.
A more direct measure of market expectations of future volatility can be obtained by using currency option prices.
The difference is that the foreign currency option is limited by time, as it does not close the position when the stop-loss price is hit yet still provides financial protection for you.
Notice 2003-81 offsetting foreign currency option contracts: A party claims a loss on the assignment of a Sec.
The probability distribution of future exchange rates implied by one-month currency option prices became notably tighter during the second quarter, reflecting expectations of lower exchange rate volatility and market participants' greater willingness to bear the risks of selling options.