Currency options

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September 2, 2021 at 8:55 pm #634038
reenatanna
Member
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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?
September 3, 2021 at 8:03 am #634079
John Moffat
Keymaster
- Topics: 57
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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.
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