Currency Derivatives Trading is emerging as an avenue for individuals and corporates in India to diversify their portfolio and manage their foreign exchange risk. Exchange Traded Currency Derivatives have registered a phenomenal growth since its inception in 2008 marking a daily turnover of almost Rs.50, 000 Cr.
Pramukh Investment offers through Reliance Securities LtdCurrency Derivative Trading Services to all its clients on all major & recognized stock exchanges.
What are Currency Derivatives?
The conversion rate at which currency of one country (e.g. USD $) can be converted into another country’s currency (For Ex. Indian Rupee) is called an exchange rate (e.g. 1$=55 Indian Rupees). Any derivative (Futures or Options) where the underlying is this exchange rate is called Currency Derivatives.
This product is used for taking carry futures and options positions in USDINR, EURINR, GBPINR and JPYINR on NSE -CD with margins as prescribed by exchange
Presentation on "How to trade in currency derivatives"
In India following Currency Derivatives are available for trading
- USDINR- Futures and Options (US Dollar, Indian Rupee)
- EURINR- Futures (European Euro, Indian Rupee)
- GBPINR- Futures (British Pound, Indian Rupee)
- JPYINR- Futures (Japanese Yen, Indian Rupee)
- Currency derivatives market is world’s biggest market (by turnover value when compared to equity and commodities)
- A new avenue to diversify portfolio
- A new instrument for Hedging and Risk Management
- Currency trading is related to global markets and macro economic conditions hence there is no threat/chance of market manipulation
- Very high liquidity and good market depth
- Low Margins (Approx 2.5% Vs. 10% in Nifty)
- Low Annualized Volatility = Low Risk (when compared to other asset classes like equities and commodities)
- Trading facility provided on reputed stock exchanges
- Trading activities are governed by SEBI
- Currency trading has lower cost & other charges as compared to Equities and Commodities
Important Links: NSE | BSE | MCX-SX | USE | SEBI | NSDL | CDSL | NCDEX | MCX | NSEL | FMC