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This video covers the basics of currency options, which are contracts between a buyer and a seller giving the buyer the right to buy or sell a fixed amount of currency at a set price before the expiration date. The buyer is not obligated to make the trade unless it is profitable. Important elements include the option's price (premium), the predetermined price (strike price), the spot rate (market price), and the expiration date. If the option is not exercised by the expiration date, the buyer loses the premium while the seller keeps it.
