Currency option


 

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Currency option

An option to buy or sell a foreign currency.



Currency option

Similar Matches

Optimal currency area

Optimal currency area

The optimal grouping of regions or countries within which exchange rates should be held fixed. First defined (as "optimum currency areas") by Mundell (1961).


Currency arbitrage

Currency arbitrage

Taking advantage of divergences in exchange rates in different money markets by buying a currency in one market and selling it in another market.


Convertible currency

Convertible currency

A currency that can legally be exchanged for another or for gold. In times of crisis, governments sometimes restrict such exchange, giving rise to black market exchange rates.


Currency risk sharing

Currency risk sharing

An agreement by the parties to a transaction to share the currency risk associated with the transaction. The arrangement involves a customized hedge contract embedded in the underlying transaction.


Foreign currency forward contract

Foreign currency forward contract

Agreement that obligates its parties to exchange given quantities of currencies at a prespecified exchange rate on a certain future date.


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