KPL's blog on Indian stock markets, science, technology and more
SEBI Registration (Research Analyst) : INH000000743
December 6, 2015
BSE 'straddle and paired options' contracts from tomorrow
Leading exchange BSE will offer from tomorrow new specialised contracts named 'straddle and paired options' in its currency derivatives segment.
The 'paired options' contracts are specialised two-legged contracts that allow a trader to take positions on two different option contracts belonging to the same product, at the same strike price and expiry.
Buying a straddle contract implies taking a buy position in the individual Call option contract and buy position in the individual Put option contract with same strike price and expiry.
These new contracts will allow traders to take positions across two different option contracts -- call and put -- with same underlying asset (such as rupee-dollar exchange rate) and with the same expiry by entering a single order.
The paired option contracts are already available in the BSE's Equity Derivatives segment and now they will also be available in the Currency Derivatives segment.
The straddle contracts will be offered in the Currency Derivatives segment to start with.