Bank sa foreign exchange rates
BankSA offers competitive Foreign Currency Options pricing for amounts of AUD, and over in all major currencies.
A Foreign Currency Option enables you to protect your business from adverse exchange rate fluctuations whilst allowing you to take advantage of any favourable movements. The value of a Foreign Currency Option is in having the right, but not the obligation, to exchange currency on a fixed date. Foreign Currency Options offer a wide range of methods for limiting the risks associated with foreign exchange exposure.
Currency Converter | Foreign Exchange Rates | OANDA
Option holders can obtain 'Insurance' against adverse movements in exchange rates while maintaining the ability to profit should the exchange rate move favourably. A Foreign Currency Option grants a customer the right, but not the obligation, to buy or sell foreign currency at a specified price within a specified period of time American Option or on a fixed date European Option. The most common Foreign Currency Option is the European style.
The agreed price at which the exchange of currencies may occur is called the exercise or strike price.
The date on which the option expires is called the expiry date. The buyer of the option pays a premium.
Upon payment of the premium the option buyer has no further obligation in the contract, but has the right to exchange currencies at the agreed Strike Price. Foreign Currency Options within Australia would normally involve conversion from or to Australian Dollars.
As such, the Australian Dollar is the underlying currency.
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If you are an importer, you would have a need to SELL Australian Dollars purchase a PUT option. If you are an exporter, you would have a need to BUY Australian Dollars purchase a CALL option. Upon expiry of the option, if the strike price is 'Out of the Money' i.
Consequently, the maximum cost of the option is the premium paid and the associated funding cost for this premium. The conversion at the more favourable exchange rate on the expiry date effectively reduces the 'cost' of the option.
If the option is 'In the Money' it is likely you will exercise your right to exchange currencies under the option. If you have any questions or want more information, you can contact us online or call us toll free on Read the Product Disclosure Statement.
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