what is the difference between a quanto and compo option 
a compo option or comp option is a variation on the quanto option the foreign asset or the payoff price may be denominated in the domestic currency or in a foreign currency with a final decision made at settlement the party who elects to change the settlement currency pays a fee for making the switch the bottom linethe quanto option removes a source of risk from foreign investing that is it protects the investor from a steep decline in the value of the foreign asset s home currency that could coincide with the contract settlement date the contract establishes that the payout will be valued in the investor s currency rather than the foreign currency 