Foreign Exchange (FX) option expiries for April 20 in the New York cut at 10:00 Eastern Time, via DTCC, can be found below. An FX option or currency option is a financial derivative that gives the buyer, or holder, the right, but not the obligation, to buy or sell a currency at a specific exchange rate, known as the strike price, on a predetermined date or expiry. These options come in two types, namely call and put options.
In the EUR/USD currency pair, these are the various strike prices, or expiry levels, for the given expiry date:
1. EUR amounts: A total of 1.6 billion with strike prices ranging from 1.0870-85.
2. EUR amounts: A total of 1.1 billion with strike prices ranging from 1.0895-00.
3. EUR amounts: A total of 0.9 billion with strike prices ranging from 1.0920-25.
4. EUR amounts: A total of 948 million with strike prices ranging from 1.0975-80.
5. EUR amounts: A total of 1.3 billion with strike prices ranging from 1.1000-10.
6. EUR amounts: A total of 1.1 billion with a strike price of 1.1100.
For the GBP/USD currency pair, there aren’t any specific strike prices or expiry levels released for the given expiry date.
In the USD/JPY currency pair, the following are the strike prices and expiry levels:
1. USD amounts: A total of 1.4 billion with strike prices ranging from 132.00-15.
2. USD amounts: A total of 738 million with a strike price of 134.30.
There are no specific strike prices or expiry levels released for the AUD/USD currency pair for the given expiry date.
Similarly, there aren’t any specific strike prices or expiry levels for the USD/CAD currency pair for the given expiry date.
For the EUR/JPY currency pair, there isn’t any specific strike price or expiry level released for the given expiry date.
The strike price or expiry level is a critical factor for FX option traders since it is the level at which the option contract will be exercised. For the buyer, the option is considered to be “in-the-money” if the strike price is more favorable than the market price at the time of expiration. On the other hand, if the strike price is less favorable than the market price at the time of expiration, the option is considered “out-of-the-money” and will expire worthless.
FX option traders try to predict the market’s direction and choose the appropriate strike price for an option in order to make a profit. It is vital to assess the likelihood of a currency pair reaching the strike price before the option expires, taking into consideration various factors, including market volatility and economic data releases. Successful FX options traders are required to constantly monitor the markets, news events, and other factors that may affect the exchange rate to mitigate the risks involved.
FX options serve as a useful tool for different market participants, like hedgers, speculators, and portfolio managers, as they enable them to manage exchange rate risks and cash flows effectively. Small and medium-sized enterprises, importers and exporters, and multinational corporations use FX options to hedge against unfavorable currency movements and protect their business operations.
On the other hand, speculators and portfolio managers use FX options to take advantage of potential currency movements and to generate profits. In general, FX options provide a flexible and customizable solution for various types of users to manage their risks and exposures in the currency markets.
