USX
Not So Foreign: Unpacking the Currency Market and USX Options Strategies
Montréal Exchange
If you have already traded options on equities but are now looking for a new asset class, you might be wondering if it is possible to blend exposure to interest rates, commodities, cryptocurrencies, geopolitics, and the global economy. In fact, you have just described the foreign exchange (FX) market and, in particular,...
Currency Options University — Part 7
Patrick Ceresna
Currency Hedging for US Dollar Investors For the past decade, Canadian investors of US dollar-based assets have had it good. No, they have had it great. Not only have American financial assets been the best performing assets in the major markets, but over that same period the value of the Canadian dollar has fallen...
Currency Options University — Part 6
Patrick Ceresna
Currency Hedging for Exporters In the previous post we examined the role that USX currency options can play in hedging a company’s import costs. In this instalment of Currency Options University, we will explore using Montréal Exchange USX currency options to mitigate the risk that Canadian exporters face when selling goods...
Currency Options University – Part 5
Patrick Ceresna
Currency Hedging for Importers Although USX currency options are often used by speculators interested in expressing a directional view on the USD/CAD exchange rate, they also offer an interesting opportunity for corporations that conduct business in both currencies and are interested in mitigating the exchange rate risk...
Currency Options University – Part 4
Patrick Ceresna
Directional Trading with USX Currency Options Our focus in Part 4 of the series is to demonstrate how USX currency options can be used for directional trading through the direct purchase of a call or put option. Options offer investors a way to buy a long position with a defined risk (limited to the cost of the option), while...
Currency Options University – Part 3
Patrick Ceresna
Part 3: Specifications of USX Options To summarize, in Part 1 we reviewed the macro drivers that influence a currency’s value, and in Part 2 we focused on the impact of those changes in the currency’s value on investors. The focus in Part 3 will be on understanding the specifications of Canadian USX options and how to size...
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