BSE Campaign

  BSE CURRENCY OPTIONS  Protecting Importer’s cost with BUY CALL option Call options are a type of derivative contracts that give  holder the right, but not the obligation to purchase a specified amount of Currency at a predetermined price, known as the “strike price” of the option. If the Currency rate rises above the option’s…

BSE Campaign

  Currency Options – An alternative to manage FX  risk PROTECTING EXPORT COST WITH  BUY PUT OPTION Companies in business of export and import are exposed to currency risk. It is wise to protect the cost of transaction against currency fluctuations. Companies can mitigate currency fluctuation risk by Futures and Options. Normally most of the…

BSE Campaign

CALCULATION OF COSTING RATE AND PROTECTING IT WITH BSE CURRENCY FUTURES ( IMPORTERS POINT OF VIEW) Business in international markets is different from handling domestic business transactions at various levels. A company that intends to buy from a foreign supplier must ensure  that the transaction is viable, profitable and he will be able to provide…

BSE Campaign

  HOW CAN IMPORTER MANAGE CURRENCY RISK THROUGH BSE CURRENCY FUTURE CONTRACTS Any individual or business that deals with foreign currency is exposed to forex risk. An importer or a foreign currency borrower has payables in foreign currency and he should  hedge his business against  weakening of  rupee. Future contracts may be categorized based on…

BSE Campaign

HOW EXPORTERS CAN MANAGE CURRENCY RISK THROUGH BSE CURRENCY FUTURE CONTRACT   One of the biggest risk factors involved in operating an Export business is that while the Purchase or Sales is in progress, the value of currency may change relative to the value of the U.S. dollar (assuming Export is with USA). This means…