currency warrants


A financial vehicle attached to currency issues that acts much like an option in which the holder is entitled to exchange the warrant for the actual currency at a stated price prior to its expiration or for the life of the warrant. The value of the warrant correlates to the underlying exchange rate of the currency so that a positive or negative move in the price direction of the currency will result in an increase of decrease in the value of the warrant. Often used as a hedge against unfavorable movement in the exchange rate.
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currency union Currenex