Forex Options Trading Strategy
Remember George Soros; the one who had broken the British pound and brought the Bank of England to its knees in the early 90s. George Soros made cool $1 Billion profit in a matter of few days by betting on the fact that the British pound was overvalued and Bank of England could not sustain its price for long.
He decided to purchase $10 Billion of puts and calls options by using all their funds assets as collateral. George Soros was willing to gamble everything on a single bet.
George Soros had perfect knowledge of the currency markets. He was sure of his bet and had the conviction that the Bank of England could not prop the overpriced British pound for long. His conviction was shared by other currency speculators. The only difference between him and them was the huge amount of the bet he placed. Bank of England was forced in just of 24 hours to take the British pound out of the European Monetary System and let it float freely. His gamble had paid off.
British pound plummeted in the currency markets. George Soros had won his bet. He became famous as the man who broke the British pound with his pictures in all the famous newspapers and magazines.
Daily more than $3 trillion are transacted in the currency markets. You as a forex trader can profit from the volatility in the currency markets using a number of methods. Forex options is one of the methods
Spot, futures and options are three contracts that are traded on centralized exchanges and available to you as a retail forex trader. Swaps and Forwards are two more contracts traded in forex markets for hedging by large institutions like big banks, multinational corporations and off course hedge funds.
Lets discuss trading forex options. Options are derivative products that give you the right to buy or cell or certain underlying asset at a predetermined price known as a strike price before or on a certain date known as the exercise date.
The underlying asset in case of the forex options is the currency. Now, forex options give you the right but not the obligation to purchase/sell a certain amount of a particular currency on payment of a premium.
You may or may not exercise your right to buy/sell the currency. If the market price of the currency is above/below your strike price, you can buy/sell that currency by exercising your option.
If the currency market price is below/above the strike price of the forex options contract that you had purchased by paying a small premium; you can simply let the options contract expire. You only lose the premium.
If you want to try forex options then there is a very good forex options strategy that lets you profit regardless of the direction in which the currency market is moving.
This method is guaranteed to give you profits with an ROI of 30-50%. Try this method. It is risk free. - 23208
He decided to purchase $10 Billion of puts and calls options by using all their funds assets as collateral. George Soros was willing to gamble everything on a single bet.
George Soros had perfect knowledge of the currency markets. He was sure of his bet and had the conviction that the Bank of England could not prop the overpriced British pound for long. His conviction was shared by other currency speculators. The only difference between him and them was the huge amount of the bet he placed. Bank of England was forced in just of 24 hours to take the British pound out of the European Monetary System and let it float freely. His gamble had paid off.
British pound plummeted in the currency markets. George Soros had won his bet. He became famous as the man who broke the British pound with his pictures in all the famous newspapers and magazines.
Daily more than $3 trillion are transacted in the currency markets. You as a forex trader can profit from the volatility in the currency markets using a number of methods. Forex options is one of the methods
Spot, futures and options are three contracts that are traded on centralized exchanges and available to you as a retail forex trader. Swaps and Forwards are two more contracts traded in forex markets for hedging by large institutions like big banks, multinational corporations and off course hedge funds.
Lets discuss trading forex options. Options are derivative products that give you the right to buy or cell or certain underlying asset at a predetermined price known as a strike price before or on a certain date known as the exercise date.
The underlying asset in case of the forex options is the currency. Now, forex options give you the right but not the obligation to purchase/sell a certain amount of a particular currency on payment of a premium.
You may or may not exercise your right to buy/sell the currency. If the market price of the currency is above/below your strike price, you can buy/sell that currency by exercising your option.
If the currency market price is below/above the strike price of the forex options contract that you had purchased by paying a small premium; you can simply let the options contract expire. You only lose the premium.
If you want to try forex options then there is a very good forex options strategy that lets you profit regardless of the direction in which the currency market is moving.
This method is guaranteed to give you profits with an ROI of 30-50%. Try this method. It is risk free. - 23208
About the Author:
Mr. Ahmad Hassam has done Masters from Harvard University. He is interested in online trading especially options and forex trading. Read more about Forex Options Non Direction Trading System. Discover a revolutionary new Forex Robot
posted by X - Men @ 5:43 AM
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