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FrançaisForward exchange option
A contractually agreed right to buy (put) or to sell (call) a specific amount of one currency for a specified amount of another predetermined future date (European option) or up to a predetermined future date (American option). Like forward exchange contracts, forward exchange options enable importers and exporters who will make or receive payments in a foreign currency at a future time, to protect themselves from fluctuations in a rate o exchange. However, unlike foreign exchange contracts, the option holder is not obligated to perform the exchange transaction if doing so is not his or her advantage.
