These new currency derivative contracts broaden the exchange’s existing range of currency futures and options contracts and allow investors the flexibility to pick the expiry date of the contract.
JSE said that the introduction of this new currency product is in response to the wholesale market looking to hedge their currency risk with increased precision.
JSE general manager of derivatives trading Warren Geers said this new contract meets the needs of a certain clients, for example, hedge fund managers working on a short term currency strategy or those in the import and export arena who would like to match exact expiry dates with those of the delivery of goods.
JSE designed the contract with wholesale investors in mind with a minimum exposure of one million of the foreign underlying.
Apart from the added flexibility of picking the expiry date, other contract specifications and fees remain the same as the existing currency derivative products, which expire on set quarterly close-out dates, said JSE.
