It is a contract that gives the holder the right not obligation to sell or buy currency at a specific period of time. In order to gain this right, the holder need to pay specified amount of premium to the broker, the amount varies, depending on the number of contract purchased.

Option actually can be used to hedge against the risk. and it is beneficial to the holder. For example, the investor believes that the rate of is going to increase from IDR 10,000 to IDR 10,030 per USD. So the investor can use the call option, so that he could stand to gain from an increase in the exchange rate.