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John Moffat.
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reenatanna
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I have a few basic doubts on currency options
1- do we ever have to calculate basis in currency options?
2- when calculating profit on options.. we find the difference between strike price and spot price. Is that correct?
John Moffat
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1. No.
2. Yes, if you are asked to calculate the profit (which needs knowledge of the spot rate on the date of the transaction). Otherwise it is a question of stating the worst outcome if options are used.
reenatanna
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