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NUTOURNE CO

Ppearl6y ago
Hello sir why in this question we have a put option, i thought it should be a call option bcoz the co is going to receive
John MoffatJohn MoffatTutor6y ago#1
In future please say which exam the question is from - I cannot remember the name of every question in every exam :-) They are receiving CHF and to convert to $'s they will sell CHF's and buy $'s. The contract size of the options is quoted in CHF, so because they want to sell CHF they will buy put options - the right to sell CHF. I do explain this in detail in my free lectures on foreign exchange risk management.
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