Compound Average Rate Option

Exchanges
Curb Trading
February 17, 2022
Accounting
Day One Gains
February 18, 2022

An option which gives it holder the right, without the obligation, to buy a currency average rate option / ARO (call or put). It is compound in the sense that it enables the holder to buy another option, i.e., the currency ARO. This option provides risk protection through the second option against currency fluctuations.

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