Hi John
my query is related to part (b) hedging techniques.
in currency options why do we choose to exercise the option.
I mean, we took out the 5 month forward rate 1.9029(which as per a technical article we may use as spot-as spot is unlikely to be given in exam). If we compare it to the 5 month option of 1.9000, then we should allow the option to lapse, shouldn't we?
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