Wednesday, June 13, 2007

Speculators Buy Options Giving the Right to Sell Yen at 127 to U.S. Dollar

(Bloomberg) -- Speculators bought at least $1
billion of options giving them the right to sell the yen at 127
to the dollar in six months, in a sign the world's worst-
performing currency this quarter may extend losses.

The put options grant the right to sell the currency at a
designated strike price. They traded with an implied volatility
of 6.38 percent, said Takeharu Miki, a currency options trading
manager at Bank of Tokyo-Mitsubishi UFJ Ltd. Implied volatility,
a measure of expectations for future currency swings, is quoted
as part of pricing options.


Read more at Bloomberg Currencies News

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