I think, first of all, you should understand what a forward contract is and what a currency option is ~\x0d\ A forward contract is essentially to deliver an asset at a price agreed by both parties at a certain point in the future. The characteristic is that the price of the contract is agreed in advance, and because the future price is unknown, while one party locks the transaction price, the other party has to bear the risk, which may be profit or loss. The option \x0d\ is actually similar, in which one party pays the other party a sum of money first to get a right from it. This right means that the buyer of the option can choose to sell or buy an asset on the expiration date (European) or any day before the expiration date (American), and the seller of the option, that is, the person who starts to collect money, must unconditionally accept buying or selling the asset at the agreed price. The power involved in currency options is the power to buy and sell currency or foreign exchange. \x0d\ Knowing these two, let's look at the foreign exchange risks of importers and exporters. Mainly refers to the risks brought by foreign exchange fluctuations. That is to say, if I export 1 ten thousand dollars today, the exchange rate is 1 dollar for 6.5 RMB; But maybe the money won't arrive until the day after tomorrow. At that time, the exchange rate will become 1 US dollar to 6.3 RMB, so I will lose 200,000 RMB. In fact, the risk also appears in the difference between the contract signing and delivery date. If there is a long time interval from signing a contract to cash on delivery, interest rate fluctuations will always bring risks. \x0d\ For this reason, forward contracts and currency options come in handy. Suppose: Now I want to export a batch of goods, but the payment of-1 10,000 dollars won't arrive until three months later, so I signed a forward currency contract with a counterparty and agreed to sell 1 10,000 dollars at the price of 6.45 RMB: 1 dollar. In other words, no matter how the exchange rate changes in the future, as long as the other party does not default, I can lock it with this exchange rate. However, if the market generally expects RMB to appreciate, then the RMB: US dollar exchange rate of forward contracts is lower than the spot exchange rate. The same is true for options, except that you have to pay a sum of money in advance. At this time, the higher the exercise price agreed in the contract, the more money you have to pay. The forward price is fixed at one point As an exporter, you buy dollar put options (or RMB call options, because you want to exercise when the dollar falls or the RMB rises), and if the dollar falls, you choose to exercise and sell; If the dollar goes up and you can't do it, change it into RMB in the spot market. So you locked in foreign exchange risk. \x0d\ For importers, it is similar to the above discussion, except that the forward contract is to sell local currency and buy foreign currency; Options should be call options in foreign currency or put options in local currency. \ x0d \ x0d \ level is limited, I hope it will help you. I'm slow, I hope it's not too late ~