Multinational Financial Management（跨国公司财务管理）ch08 Options Contracts and Currency Futures.ppt

CHAPTER8 OptionsContractsandCurrencyFutures PARTI FuturesContracts FUTURESCONTRACTS I CURRENCYFUTURESA MarketHistory 1 Backgrounda Longhistoryb Extremelyvolatileduetotheirinformationdrivennaturec ThemarketplaysaPriceDiscoveryRoleforotherfinancialmarketssuchasthecashmarkets FUTURESCONTRACTS B InternationalMonetaryMarket IMM 1972 openedbytheChicagoMercantileExchangePurpose toprovideastablemarketfortheexchangeofcurrencyfutures FUTURESCONTRACTS 2 IMMprovidesa anoutletforhedgingcurrencyriskwithfuturescontracts DefinitionofaFuturesContract contractswrittenrequiringastandardquantityofanavailablecurrencyatafixedexchangerateatasetdeliverydate FUTURESCONTRACTS b AvailableFuturesContractsCurrency ContractSize 1 Britishpound 62 5002 Canadiandollar 100 0003 Euro 125 0004 Swissfranc 125 0005 Japaneseyen 12 5million6 Mexicanpeso 500 0007 Australiandollar 100 000 FUTURESCONTRACTS c Transactioncosts intheformofacommissionpaymenttoafloortraderd Leverageishigh1 Initialmarginrequiredisrelativelylow lessthan2 ofcontractvalue FUTURESCONTRACTS SAFEGUARDS e Maximumpricemovementrules Contractssetdailytoapricelimitthatrestrictsmaximumdailyupwardanddownwardmovements FUTURESCONTRACTS SAFEGUARDS f MaintenanceMargins Whentheaccountbalancefallsbelowthemaintenancemargin amargincallmaybenecessarytomaintaintheminimumbalance FUTURESCONTRACTS g Globalfuturesexchanges 1 I M M InternationalMonetaryMarket2 L I F F E LondonInternationalFinancialFuturesExchange3 C B O T ChicagoBoardofTrade4 S I M E X SingaporeInternationalMonetaryExchange5 D T B DeutscheTerminBourse6 H K F E HongKongFuturesExchange FUTURESCONTRACTS B Forwardvs FuturesContractsBasicdifferences 1 TradingLocations6 Quotes2 Regulation7 Margins3 Frequencyof8 Creditriskdelivery4 Sizeofcontract5 TransactionCosts FUTURESCONTRACTS Advantagesoffutures 1 Easyliquidation2 Well organizedandstablemarket Disadvantagesoffutures 1 Limitedto7currencies2 Limiteddatesofdelivery3 Rigidcontractsizes PARTII CurrencyOptions CURRENCYOPTIONS I OPTIONSA Currencyoptions1 offeranothermethodtohedgeexchangeraterisk 2 firstofferedonPhiladelphiaExchange PHLX 3 HOWCURRENCYOPTIONSAREPURCHASED BuyersSellers Writers Buy Sell Buy Sell CALL PUT Premium CURRENCYOPTIONS 4 Definition acontractfromawriter theseller thatgivestherightnottheobligationtotheholder thebuyer tobuyorsellastandardamountofanavailablecurrencyatafixedexchangerateforafixedtimeperiod CURRENCYOPTIONS 5 ExpirationDatesofCurrencyOptions a Americanexercisedatemayoccuranytimeuptotheexpirationdate b Europeanexercisedateoccursonlyattheexpirationdateandnotbefore 6 Whatisthepremium thepriceofanoptionthatthewriterchargesthebuyer CURRENCYOPTIONS 7 ExercisePricea Sometimesknownasthestrikeprice b Theexchangerateatwhichtheoptionholdercanbuyorsellthecontractedcurrency CURRENCYOPTIONS c TypesofCurrencyOptions 1 Calls givetheownertherighttobuythecurrency2 Puts givetheownertherighttosellthecurrency CURRENCYOPTIONS 8 Statusofanoptiona In the moneyCall Spot strikePut Spotstrikec At the moneySpot thestrike CURRENCYO