Basket Option - An option constructed
around a series (or <169>basket<170>)
of different commodities, securities or currencies.
For example, a currency basket option gives its holder
the right to buy (call) or sell (put) a specified
basket of foreign currencies in exchange for a fixed
price (denominated in the investor's native currency)
at a specified future date. Currency basket options
have become prominent in modern portfolio management
practices, as they allow investors to hedge all or
most of their foreign currencies simultaneously, often
at lower cost than would be incurred for individual
option contracts on each currency.
