im no expert, but the basics are like this. You buy an option,...

im no expert, but the basics are like this. You buy an option, and pay (in this case) 60 c to convert it to an share at a later date, so the option price generally keeps a constant buffer - the conversion price. Say FXR goes up by 60 c - thats a 50% gain for FXR, its a 100% gain for FXROA. Works the same with losses, so its basically the company trasfering risk to the market place.

which is why i bought FXROA in this case - im confident of a significant increase in sp.