Series 3: 4.3.2.2. Long Calls

4.3.2.2. Long Calls

For greater protection against foreign exchange risk, an importer might choose to purchase a long at the money (or near the money) call. Like a protective put for hedgers who are long inventory, a long call will eliminate all upside risk except for the cost of the premium plus brokerage commissions. It will also enable the hedger to capture most of the profits to be earned f