FX and Cash Management

FX Options

You can buy FX options to hedge or leverage an exposure.

There are 2 types of options:

  1. A "Put" option gives the buyer the right but not the obligation to sell the underlying currency at a predetermined price.
  2. A "Call" option gives the buyer the right but not the obligation to buy the underlying currency at a predetermined price.

In both cases the seller of the option is paid a premium by the buyer of the option. Options are not suitable for all investors, as they carry significant risks. Only recommended for experienced investors.

Some of the Benefits

Potential to enhance returns:

  • By selling put options while waiting to buy a currency at a lower price
  • By selling call options while waiting to sell a currency at a higher price

Some of the Risks

  • Selling an option generally entails considerably greater risk than purchasing options and a seller of options may sustain a loss well in excess of the amount of the premium received.

For more information:

  • Contact your Wealth Manager or visit any of our branches.

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