A Call Option is a contract that gives the contract holder the right to buy a specific amount of foreign currency at a set price (exchange rate) on or before the contract’s maturity date.
A Put Option gives the contract holder the right to sell a specified amount of foreign currency at a predetermined price on or before the maturity date.
Our team can issue both Call (the right to buy) and Put (the right to sell) Options in most major currencies, enabling your business to purchase currency at a predetermined price in the future.
Through our Foreign Currency Options, your company can take advantage of any favourable spot exchange rate movement while protecting your business against adverse movements. This solution could be used to reduce your currency risk exposure and enhances the flexibility of your currency hedging strategy.
Your business can purchase Call or Put Options to compensate for any increase or decrease in prices beyond or below a predetermined level. However, should prices decline, the benefit of the lower levels will be for the business to keep. As with normal insurance, options carry a premium, paid upfront, or as an option pay-out.
No credit facilities are required to acquire Option contracts, but there must be a physical exposure to justify derivative structures.
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