Currency option

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Currency option

An option to buy or sell a foreign currency.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Currency Option

An option contract in which the underlying asset is a foreign currency. The option gives the holder the right but not the obligation to buy (for a call) or sell (for a put) a set amount of the currency at a certain exchange rate on or before the expiration date. They are largely used when international corporations wish to hedge against the possibility of adverse movements in foreign exchange rates.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
References in periodicals archive ?
The implied volatility in foreign exchange options in emerging markets declined in the second quarter to 9.2 percent, compared with 9.5 percent at the end of the previous quarter.
Baris Temelkuran, head of exotic foreign exchange options trading at Goldman Sachs (NYSE: GS), is leaving the firm.
NEW YORK: BNY Mellon is now live with foreign exchange options. BNY Mellon clients now have access to a full-service currency trading desk, offering spot, forwards, non-deliverable forwards as well as options.
His team works with clients to design effective hedging strategies, utilizing foreign exchange options and cross-currency swaps.
The bourse plans to introduce index options in the second quarter of 2013 and foreign exchange options will start trading in 2013, Yilmaz said.Source: bne
The prices for foreign exchange options allow us to extract information on implied market perceptions of future exchange rate risk.
Commenting on the launching of the foreign exchange options trading service and its corresponding trading platform, Mr.
"We are prevented from recommending private services and therefore draw the tourist's attention to the different foreign exchange options on offer," the ministry said.
Toronto, Ontario, May 7 -- BMO Capital Markets, the investment and corporate banking arm of BMO Financial Group (NYSE: BMO)(TSX: BMO), this week started trading foreign exchange options in the Chinese Yuan (CNY).
Turkish Exporters Assembly (TIM) and Turk Eximbank signed Thursday a protocol on "foreign exchange options operations" in an effort to help exporters protect their export receivables against the risks of the floating rate regime.
Volume Match is integrated into the BGC Trader platform and at pre-set times during the day it offers customers auction-style electronic trading across a range of asset classes including credit default swaps, foreign exchange options, precious metals and interest rate swaps.

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