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Currency and Commodity Future and Option Operations on a Stock Exchange upon Customer Request
Presently, VTB trades on two floors, namely:
- Moscow Interbank Currency Exchange (MICEX);
- St. Petersburg Currency Exchange (SPCEX).
Futures is an obligation to purchase or sell the underlying asset at a fixed price. Traditionally, these instruments are used to hedge the price movement of the underlying asset. In the event of higher exchange rate, a company would not get any additional income. Futures trading is regulated by the Stock Exchange. All futures contracts are made without actual delivery.
Call option is the right (not an obligation) to purchase the underlying asset in the future at a fixed exchange rate/price. It is usually applied to hedge the increasing price of the assets. In the event of a drop in the relative rate or price, a company may buy the underlying asset without exercising the option.
Put option - is the right (not an obligation) to sell the underlying asset in the future at a fixed exchange rate/price. It is usually applied to hedge the decreasing price of the assets. In the event of a rise in the relative rate or price, a company may sell the underlying asset without exercising the option.
When buying an option, the buyer shall pay a premium. Option trading is regulated by the Stock Exchange. All option contracts are made without actual delivery.
