PAT - The Payoff Advantage Tool
Best of Two Assets

Currency 1: Best of Two Assets: Currency 2 and Currency 3

Formula: H1 = max(max(S12, S13) – X, 0)

Currency 2: Unidentified. Asset 3: Unidentified.

Again an example of a truly multi-currency option. In any case, PAT can always identify financially equivalent alternative payoffs.

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