Thursday, October 28, 2010

Launch of Currency Options & FX report on Oct 28-2010

  Trading of USDINR Currency Options would commence on NSE w.e.f 29th Oct 2010.
Currency Options brings in an excellent opportunity for the corporate and their Treasury desk. It provides them an alternative to hedge currency risk. Since buying Options are less risky due to its limited down side. Corporates can also sell Options at Exchange platform which can be a unique advantage to them.
Some of the advantages of Exchange Traded Currency Options are:
Better price and transparency – high liquidity allows better price discovery
Easy and faster execution – live screen based quotes enables easier and faster intraday day trades
Better risk management – Allows to formulate different strategies like Delta/Gamma hedging
Wide reach and reliability – more than 1,50,000 terminals across 1500 plus locations
Some of the key features of Currency options are as follows:
       European Style settlement
       Three monthly contracts and one quarterly contract ( eg. Nov'10, Dec'10, Jan'11 & Mar'11)
       12-1-12 strike interval ( for Call and Put) 
       Tick size (minimum price variation)  - INR 0.0025
       Strike interval - INR 0.25.

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