Call Option A call option gives the buyer the right to buy (go long) a spot currency pair at a specific price on an expiration.
Put Option A buyer of a put option has the right to sell (go short) a spot currency pair at a specific price on the expiration date. |
Option Buyer The buyer, or holder, of an option can choose to exercise his right and...
Option Seller Option sellers (i.e., those who sell options that they didn’t previously... |
Option Buyer
• Pays premium.
• Right to exercise, resulting in long spot position (call buyer...
Option Seller
• Collects premium
• Obligation if assigned, resulting in a short position... |
- Underlying Currency Pair
- Premium
- Exercise
- Exercise Price
- Expiration Date
- Offset |
Intrinsic value and time value
The price of an option consists of two parts, the intrinsic value and the time value. The intrinsic value is defined as the difference between the strike price and the underlying FX spot rate...
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IFSCL 
