Forex Trading & Forex Options

Forex Robot:


Forex option trading has emerged as an alternative investment vehicle for many traders and investors. Forex trading produces both large and small investors with greater flexibility when determining the appropriate forex trading and hedging strategies to implement.
Most forex options trading are conducted via telephone as there are only a few forex brokers offering online forex option trading platforms.




Forex Option:

Forex Option Defined - A forex option is a financial currency contract giving the forex option buyer the right, but not the obligation, to purchase or sell a specific forex spot contract (the underlying) at a specific price (the strike price) on or before a specific date (the expiration date). The amount the forex option buyer pays to the forex option seller for the forex option contract rights is called the forex option "premium."

The Forex Option Buyer - The buyer, or holder, of a foreign currency option has the choice to either sell the foreign currency option contract prior to expiration, or he or she can choose to hold the foreign currency options contract until expiration and exercise his or her right to take a position in the underlying spot foreign currency. The act of exercising the foreign currency option and taking the subsequent underlying position in the foreign currency spot market is known as "assignment" or being "assigned" a spot position.