If we denote by S the FOR/DOM exchange level (i.e., 1 unit of international forex is worthy of S models of domestic forex) we could notice that having to pay out 1 device from the domestic currency When the place at maturity is earlier mentioned or beneath the strike is strictly just like a funds-or almost nothing call and place respectively.
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This pays out one particular unit of asset In case the spot is over the strike at maturity. Its worth now is supplied by
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