Indian Rupee Options
Indian Rupee – Options contracts is an logical extension of the of the Indian Rupee Futures. The options contracts allow market participants to hedge their Indian Rupee exposures using various option strategies as well as a combination of futures and options.
Dubai Gold and Commodities Exchange is the first exchange offshore to offer option contracts. Options allow participants to take a call on the underlying Indian Rupee by paying a small premium, while the option writer can benefit by taking a view on the underlying volatility of the Indian Rupee.
- Hedging window available long after Indian currency markets close
- Arbitrage opportunity with USD-INR options available in offshore
- Two months option contracts are available
- Strikes are available 2.50 Indian Rupees from the at the money strike
- There is no margin applicable to the buyer of an option
- Unique trading opportunity for Indians in the region and international funds with exposure to India to manage their risk
- Options are most leveraged of all financial instruments and various strategies can be built to manage risk in the most cost effective manner for example straddles, strangles , ladders and butterflies
- UAE is a Tax Free jurisdiction ensuring no tax liability arising out of accrued profit
- Market hours from 8.30 AM India time till 1.25 AM India time
- Overlaps most trading zones including Europe and United States
Contract Parameters Contract Type/Style Option – European style Contract Name Indian Rupee/US Dollar Contract Symbol DINRO Underlying Indian Rupee/US Dollar Futures Contract (DINR) Contract Size 1 DINR Notional Contract Value INR 2,000,000 Trading/Settlement Currency USD Price Quote US Dollars quoted in Cents per 100 Indian Rupees Tick Size US$ 0.01 Tick Value US$ 2.00 Exercise Price Intervals INR 0.25 converted to USD to 2 decimal places Introduction of New Exercise Prices For all contract months: a minimum of 41 Strike Prices in increments of 20 above and 20 below the at-the-money strike Settlement Basis Assignment of 1 DINR contract at the exercise price. The futures delivery month shall be: Exercise of Options On Last Trading Day, all in-the-money options are exercised automatically against the FCSP of the DINR Last Trading Day (LTD) Two Business Days prior to the last Business Day of the contract month Trading Days Exchange Business Days* Trading Hours 07:00 – 23:55 Hours Dubai time Trading Months Monthly contracts for two months forward Margining Buyer pays full premium, Seller is margined using SPAN New Contract Listing Five Business days immediately following the Last Trading Day Max Order Size 200 Lots Wholesale Trades Block Trade minimum size threshold: 50 lots. EFP/EFS also available. Trades must be submitted 15 minutes after execution No Cancellation Range See link: www.dgcx.ae/price-limits
Expiry Month Expiry Code Last Trading Day Oct'18 DINRO-20181029 29 Oct 2018 Nov'18 DINRO-20181128 28 Nov 2018