1. In the foreign exchange market, two major types of options are: The price of

Question

1. In the foreign exchange market, two major types of options are: The price of option is called: and 2. In financial market, an action taken to protect one's income, assets, debt, and commodity prices from the consequences of potential future price changes is known as: For a risk-averse investor, in order to bear the foreign exchange rate risk during investment, incentive and reward called need to be initiated 3. In the foreign exchange market, an action which involves simultaneous closing of spot and forward exchange contracts is known as the: while often, an investor will hedge with payments or receipts are uncertain. as future foreign currency

Explanation / Answer

1)CALL OPTION(an option to buy the underlying asset is known as a call option

SELL OPTION(an option to sell the underlying asset is known as sell option)

PERMIUM (the price of option is known as premium)

2)HEDGING(is risk management technique to reduce any loss and substantial losses or gain suffering by an individual or organization

CURRENCY HEDGING (It will bear foreign exchange rate risk during investment)

3)forex swap

Foreign currency

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.