(idea) by mattbw Mon Feb 28 2005 at 2:09:11
Financial Engineering

A Quanto option is an option with a cross-currency feature; that is, one with a payoff which is based on a market currency that differs from the payoff currency.

As an example, one could purchase in the Over the Counter or OTC market, a call option on the Nikkei 225's relative performance over a year, with payouts in USD.
del.icio.us Facebook Digg StumbleUpon Reddit (I like it!)
Y'know, if you log in, you can write something here, or contact authors directly on the site. Create a New User if you don't already have an account.