[Hans]

Exactly, at the end you get like USD 23m out of the EUR 20. And no need for a put as the more the USD depreciates, the more USD you will get from the EUR 20. The examples in BPP were always with contracts based on either GBP or EUR. That’s why it was confusing to see 0.89 as strike, but it makes sense as the contracts were based in USD.

[Hans]

Hi Danny,

You are receiving EUR 20m and hence you need to hedge against the strengthening of the USD. If the USD depreciates, you will receive much more EUR. If the dollar gets stronger, you will receive less. Thus, your only option is to buy a call, as you want to receive a guaranteed minimum amount.

[Hans]

There is something wrong there, Q1 receipt was around USD 23m, and the historical growth rate was 16.6 % without project. (Dividend grew from 10800 to around 20000). It was way higher than the project which had only 7%.

[Author]

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