Category Derivative

Meaning of Money Market Hedge Money market hedge is one of the tools of risk management related to foreign exchange risk. Under this, forex risk can be hedged…

Meaning Under Currency future contract two parties are agreed to buy or sell an underlying currency at future date on agreed upon price. This derivative contract provides both…

Meaning Currency Call Option is a contract between two parties under which option buyer gets the right to buy the underlying currency within a specified period. For buying…

Meaning Currency Put Option is a contract between two parties under which option buyer gets the right to sell the underlying currency at pre-determined price (Strike Price) within…

Meaning of Currency Option Currency Option is a contract between two parties that provides the buyer the right to buy or sell specified quantity of underlying currency on…

Extension or Rollover of Forward Contract Some times may be due to some unforeseen reasons, payment or receipt of foreign currency is required to be deferred. In such…

Concept of Cancellation of Forward Contract If due to some uncertain events or reasons, if forward contract can not be executed then it is cancelled. There are so…

Meaning of Currency Forward Contract Currency Forward Contract is an instrument that can be used for hedging the exposure in foreign currencies. Under this contract customer enter into…

What is Futures Margin? Futures margin is a precondition to enter into future contract. Under future contract two parties are agree to sell and buy an underlying asset…