Foreign exchange. Put option means that the owner of the contract has the right to sell a certain amount of foreign exchange at the execution price.

Fulfill the contract: the holder of foreign exchange option has the right to decide whether to "fulfill" the contract or let it expire without execution. Strike price or strike price: The price of spot or forward contract reflects the current market price. In foreign exchange options, the price to be settled in the future is called the strike price or the strike price. The performance price was determined at the beginning of the signing of the peace treaty, which may be completely different from the forward and forward exchange rates.

Maturity date: foreign exchange options and contracts have a final maturity date. If the option holder wishes to perform the contract, he must inform the other party before the contract expires. The expiration date is expressed as a certain time on a certain day of a certain month of a certain year, for example,1999165438+10/8, Eastern Standard Time 10: 00 am. Related terms in

Parity: If the exercise price of the option (i.e. the contract price) is equal to the spot exchange rate at that time, it is called spot parity. If the strike price is equal to the corresponding forward exchange rate at that time, it is called forward parity. For example, the strike price of the three-month option and the forward exchange rate of the three-month option are both 1.7500DEM/USD.

Discount: For option holders, when the strike price (for example, 1.5000 DEM put option) is better than the spot exchange rate (for example, 1.8000DEM/USD), it is the spot discount. The same is true of forward discount.

Premium: It is easy to guess that premium refers to the spot premium of option holders when the strike price (for example, 1.8000 DEM put option) is lower than the spot exchange rate (for example, 1.5000DEM/USD).

Source-Mi Le Foreign Exchange.