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Equity Linked Foreign Exchange Option |
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Equity Linked Foreign Exchange Option A position involving a combination of an option contract on a currency and a forward contract on a stock. If the currency's value moves in a direction favorable to the investor, the investor receives a payoff depending on the performance of the stock underlying the forward contract. If not, the investor does not receive a payoff. An ELF-X helps an investor hedge against foreign-exchange risk. It is also called a portfolio currency protection option. Want to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit the webmaster's page for free fun content. |
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