PAT - The Payoff Advantage Tool
Asset or Nothing - Put

Domestic Payoff: Asset or Nothing Put Option.

Formula: Hd = Sd * heavy (Xd - Sd)

Xd = 1.1

Foreign Payoff: Cash or Nothing Call Option.

This is again a situation where a foreign financially equivalent payoff is not similar to the shape of the original domestic payoff. However, it is obvious that the foreign payoff has the shape of a Cash or Nothing Call option.

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