what is an option on currency pair
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- Binary option trading is performed on many assets including currency pairs. EUR/USD: This currency pair is ideal for new traders as this pair offers stable movements over a long period of time. This is one of the reasons why most traders prefer trading on this currency pair.
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Foreign Currency Futures & Options Currency futures and options are derivative contracts. These contracts derive their own values from utilization of the underlying assets, which, in this case, are currency pairs. Currencies are always traded in pairs. For example, the Euro and U.S. Dollar pair is expressed as EUR/USD.
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What is a 'Currency Swap' What is a 'Currency Swap'. A currency swap, sometimes referred to as a cross-currency swap, involves the exchange of interest and sometimes of principal in one currency for the same in another currency. Interest payments are exchanged at fixed dates through the life of the contract.
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currency option Contract that confers the right (but not the obligation) to buy or sell a given amount of a particular currency at a specific exchange rate either (1) on a fixed future date (called European option), or (2) on any date up to a fixed future date (called American option).
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- An investor should understand these and additional risks before trading. Options involve risk and are not suitable for all investors. Futures, options on Futures, and retail off-exchange foreign currency transactions involve substantial risk and are not appropriate for all investors. Please read Risk Disclosure Statement for Futures and Options prior to applying for an account. *Low margins are a double edged sword, as lower margins mean you have higher leverage and therefore higher risk. All commissions quoted are not inclusive of exchange and NFA fees unless otherwise noted. Apex does not charge for futures data, but effective January 1, 2015 the CME charges $1-15 per month depending on the type of data you require.
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Currency Trading How Forex Works. The currency exchange rate is the rate at which one currency can be exchanged for another. It is always quoted in pairs like the EUR/USD (the Euro and the US Dollar). Exchange rates fluctuate based on economic factors like inflation, industrial production and geopolitical events.
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How does forex trading work? When you open a forex position, you are buying one currency while simultaneously selling another. Read on to learn about forex trading basics and how a forex trade works: including currency pairs, the spread, pips and leverage. Currency pairs Forex trading always involves selling one currency in order to buy another. For this reason, they are quoted in pairs that show which currency is being bought and which is being sold. Each currency in the pair is listed in the form of its three letter code, which tends to be formed of two letters that stand for the region, and one standing for the currency itself.
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Exchange rate A currency pair is the quotation of the relative value of a currency unit against the unit of another currency in the foreign exchange market. The quotation EUR/USD 1.11 means that 1 Euro is able to buy 1.11 US dollar.In other words, this is the price of a unit of Euro in US dollar.xchange rates are determined in the foreign exchange market, which is open to a wide range of different types of buyers and sellers where currency trading is continuous: 24 hours a day except weekends, i.e. trading from 20:15 GMT on Sunday until 22:00 GMT Friday.
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DEFINITION of 'USD/CAD (U.S. Dollar/Canadian Dollar)' DEFINITION of 'USD/CAD (U.S. Dollar/Canadian Dollar)'. The abbreviation for the U.S. dollar and Canadian dollar (USD/CAD) currency pair or cross. The currency pair tells the reader how many Canadian dollars (the quote currency) are needed to purchase one U.S. dollar (the base currency). Trading the USD/CAD currency pair is also known as trading the Loonie.
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- The correlation of currencies allows for better evaluation of the risk of a combination of positions. Correlation measures the relationship existing between two currency pairs. For example, it enables us to know whether two currency pairs are going to move in a similar way or not. Two correlated currencies will have a coefficient close to 100 if they move in the same direction and of -100 if they move in opposite directions.
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Pricing Reduce your trading cost with no trade commissions and no early redemption fees. Combination Orders with Equity and Options Legs (including buy writes, sell writes, and unwinds): $0.65 per contract for the option leg, plus $4.95 commission for the equity leg. There is no base commission for the option leg.
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- You should be running at a comfortably hard level. Try increasing the pace for 200 meters or 30 seconds with a 90-second rest interval. Or run for 1 minute at a faster pace and then slow down for 2 minutes. Do what feels right for your body.
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DEFINITION of 'AUD/USD (Australian Dollar/U.S. Dollar) ' The abbreviation for the Australian dollar and U.S. dollar (AUD/USD) currency pair or cross. The currency pair tells the reader how many U.S. dollars (the quote currency) are needed to purchase one Australian dollar (the base currency).Trading the AUD/USD currency pair is also known as trading the Aussie.he abbreviation for the Australian dollar and U.S. dollar (AUD/USD) currency pair or cross. The currency pair tells the reader how many U.S. dollars (the quote currency) are needed to purchase one Australian dollar (the base currency).
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- CURRENCY: What are spot and forward contracts? International payment specialist Smart Currency Exchange offers a range of options to suit each client’s individual needs when it comes to buying and transferring currency abroad.
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Forex Glossary In FX trading, the Ask represents the price at which a trader can buy the base currency, shown to the left in a currency pair. For example, in the quote USD/CHF 1.4527/32, the base currency is USD, and the Ask price is 1.4532, meaning you can buy one US dollar for 1.4532 Swiss francs.
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Foreign exchange option Foreign exchange option – the right to sell money in one currency and buy money in another currency at a fixed date and rate. Strike price – the asset price at which the investor can exercise an option. Spot price – the price of the asset at the time of the trade.
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- 1. The sum of the open currency spot position and the open currency forward position, being the measure of the foreign exchange risk. 2. The open currency position is the difference between balance assets and liabilities in foreign currency plus the forward (conditional and unconditional) forex purchased and sales.The open currency position is the measure of the foreign exchange risk. Related position codes are: 1. Open currency position per CCY. 2.. The open currency position is the difference between balance assets and liabilities in foreign currency plus the forward (conditional and unconditional) forex purchased and sales. The open currency position is the measure of the foreign exchange risk. Related position codes are: 1. Open currency position per CCY. 2.
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- The base currency, or denominator, is the first in a currency pair, the second currency is the quoted currency. The value of the quoted currency is expressed in terms of one unit of the base currency. In euro/dollar, for example, the value of the dollar is quoted or expressed in terms of one euro.
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What are Currency Pairs and the Basics of Currency Trading A currency pair is a quotation featuring two different currencies, with currency being quoted in terms of the other. A currency exchange rate is always quoted in a currency pair, such as EUR/USD (Euro/U.S.Dollar). “euro cross” contains the Euro in the currency pair. When the U.S. dollar is the base currency and a currency quote goes up, it means the dollar has appreciated in value and the other currency has comparably weakened.
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Exchange rate In finance, an exchange rate (also known as a foreign-exchange rate, forex rate, ER, FX rate or Agio) between two currencies is the rate at which one currency will be exchanged for another. It is also regarded as the value of one country’s currency in relation to another currency.
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- The exchange rate expresses the national currency's quotation in respect to foreign ones. For example, if one US dollar is worth 10 000 Japanese Yen, then the exchange rate of dollar is 10 000 Yen.ther bilateral exchange rates may be simply computed from triangular relationships: if the exchange rate dollar/yen is 10 000 and the dollar/Angolan kwanza is 100 000 then, as a matter of computation, one yen is worth 10 kwanza.
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Which is the best currency pair to trade for beginners? The EUR/USD volatility (movement) can be about 50-100 points during one trading session, however, movements of 300 points in one session are also possible. The best way to trade this currency pair is to use a trend following strategies. EUR/USD is not the best option for beginners. Predictions of the movement of the EUR/USD from various financial organizations are usually inaccurate and often contradict each other.
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- Definition. In the Forex market, liquidity pertains to a currency pair’s ability to be bought and sold without causing significant change in its exchange rate. A currency pair is said to have high level of liquidity when it is easily bought or sold and there is a significant amount of trading activity for that pair. Related Terms.
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Foreign exchange option Foreign exchange option. In finance, a foreign exchange option (commonly shortened to just FX option or currency option) is a derivative financial instrument that gives the right but not the obligation to exchange money denominated in one currency into another currency at a pre-agreed exchange rate on a specified date.
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Forex Glossary In the forex market, the US dollar is normally considered the base currency for quotes, meaning that quotes are expressed as a unit of $1 USD per the other currency quoted in the pair. The primary exceptions to this rule are the British pound, the euro and the Australian dollar.