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Derivatives




Quanto Basket Option


An option whose underlying is a basket of assets that can be denominated in various currencies other than the one in which the option is quoted. For example, an option could be denominated in dollar while its underlying is a set of three assets denominated in three different currencies (yen, baht, and yuan).

This option allows investors to take views with regard to the basket appreciation/ depreciation against a given currency (in this case the dollar).



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Derivatives have increasingly become very important tools in finance over the last three decades. Many different types of derivatives are now traded actively on ...
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