Opinion/Trading
Structured note digital payout versus participation factor
Neil Bardsley , vice-president and FX options correlation trader at Bank of America, studies the use of an at-the-money spot basket option versus a digital payout in a structured note
Speculative positions for all currency pairs
Senior portfolio strategist Henrik Degrér at SEB in Stockholm develops a proxy to gauge speculative positions for all currency pairs
A simple strangle for EUR/GBP vol
Currency managers can insure against unexpected moves in the EUR/GBP using a simple low-cost method, says Neil Mellor, currency strategist at the Bank of New York in London
Diversifying through Africa
African basket options are a good vehicle for picking up yield and diversifying away risk, says Marios Maratheftis , FX strategist at Standard Charterd Bank in London
Where have all the petrodollars gone?
Jeffrey Young, managing director, head of currency research, and Eric Darwell, vice-president, currency strategist VP at Citibank in New York, analyse where 'petrodollars' are going and the ramifications for the greenback
Risky currencies are well supported
Despite a widespread perception to the contrary, most high-yielding currencies continue to do very well on strong fundamentals and firm inflows, says Beat Siegenthaler, senior strategist at TD Securities in London
Trading FX implied volatility – part II
The use of at-the-money straddles can be an effective way to trade implied volatility, but it is not without its limits. In the final part of a two-part series, Duncan Farnsworth, head of risk analytics in the currency structuring group at Royal Bank of…
Is sterling ripe for a fall?
The trade-weighted value of sterling has dropped to levels last seen in late 2003. At the start of Q2 there has been much speculation about the increasingly negative prospects for the UK economy and sterling, writes Jeremy Stretch, FX strategist at…
China is not the only egg in the basket
Reuters' deal with Union Bank of India demonstrates that there is a wealth of opportunity in the sub-continent for banks looking to drive forex returns in emerging markets.
There are no options benchmarks
The following is a case study of option volumes with delayed delivery, by Nasir Afaf, global head FX options, Commerzbank Corporates & Markets in London
Pressure likely for the greenback
The improvement in February's US trade data is likely to be short-lived. Deutsche Bank's strategy team continues to look for EUR/USD to grind higher over the course of the quarter. Is the deterioration of the US basic balance still a valid reason to sell…
A changing regime
Low-yielding currencies are set to make a comeback, writes Teis Knuthsen, head of FX and fixed-income research at Danske Bank in Copenhagen
Defrosting the myths
The risk of an Icelandic crisis and its impact on other high-yielding currencies has been strongly exaggerated, says Beat Siegenthaler, senior strategist at TD Securities in London
The end of emerging market exuberance?
A plunge in high-yield currencies has triggered concerns that global investors had become too lax in their evaluation of emerging market risk, but Caroline Blyth, emerging market manager at Informa Global Markets, says the likelihood of a serious…
A Russian revolution
Jurye Pimenov , senior FX dealer at the Central Bank of the Russian Federation, and Igor Souzdaltsev , project manager in financial markets at Investsberbank in Moscow, analyse the Russian rouble's strength and its recent comeback after the financial…
April – a perfect storm for Asian FX?
Investors could profit from the prospect of an unusually volatile month for the normally low-vol USD/SGD. Sean Callow , senior currency strategist at Westpac Institutional Bank in Singapore, explains how this can be achieved
Trading FX implied volatility
How frequently does one need to hedge to effectively trade implied volatility? Duncan Farnsworth , head of risk analytics in the currency structuring group at the Royal Bank of Scotland in London, offers a solution
Not too late to sell the Swedish krona
As the short-term interest rate spread between the eurozone and Sweden increases, we are likely to see further depreciation of the krona, writes Henrik Degrér , senior portfolio strategist of Skandinaviska Enskilda Banken (SEB)
Is risk adequately priced?
An end to carry plays on high-yield emerging currencies would create volatility in FX markets and potential flight to safe-haven assets. Sharada Selvanathan , currency strategist at BNP Paribas in Singapore, suggests a basket to benefit from this
Turkey and the butterfly
Marios Maratheftis , FX strategist at Standard Chartered Bank in London, says it is one thing being positive on the TRY and another being complacent. Here he presents three models that can help with the timing of TRY trades.
Look past the Fed for dollar positives
Geoff Kendrick, senior currency strategist at Westpac in London, believes the market is too focused on the Fed's intention for rates, and is therefore missing the medium- term positive signs for the greenback
Future opportunities from EUR/CHF
Corvin Codirla and Adarsh Sinha, fx strategists at barclays capital in london, show that while low eur/chf volatility may be justified at present, investors should position for a pick-up further out
A flexible approach to hedging
UBS's FX structuring team offers two case studies highlighting the benfits of flexible hedging solutions in the form of flexi notional forwards and structured flexi forwards
Loonie flight to quality remains on course
The current outlook for real interest rates and the growth picture remains favourable for the Canadian dollar, writes Ashraf Laidi , chief currency analyst at MG Financial in New York