Forex Options Trading Conditions
The value of your investments can go down as well as up.
Losses can exceed deposits on margin products. Please ensure you understand the risks.
FX Vanilla Options
Saxo Capital Markets provides you with access to available liquidity and live streaming prices. Our options prices are shown on your trading platforms as dynamic Bid/Ask spreads. The options bid/ask spreads are of a variable nature and depend on the contracts’ maturity and an underlying currency pair.
Samples of current live FX Vanilla Options spreads, updated every hour are available under 'Spreads' - see Prices.
Available for trading in 44 currency pairs, including silver and gold.
Calls (option to buy a currency at a specified strike price) and Puts (option to sell a currency at a specified strike price).
Maximum streaming amount is 25,000,000 units of base currency, with a minimum ticket size of 10,000 units. Notional amounts over the maximum streaming amount are available on a Request for Quote (RFQ) basis.
Note. Maximum streaming amounts may be changed without prior notice under volatile or illiquid markets.
Tradable tenors from 1 day to 12 months.
Calculated in pip terms of the 2nd currency. When buying an option the maximum loss is the premium paid, but when selling an option the writer receives the premium however assumes the potential of much greater downside risk.
European-style (the option can only be exercised on the expiry date, i.e. at a single pre-defined point in time).
Expiry is an automatic process, meaning you do not have to call in to manage the exercise or expiry. If the option is in the-money it will automatically settle in the pre-defined exercise method (described in the next point), or the option will automatically expire (cease to exist) at 10am Eastern Standard Time (New York cut) on the expiry date.
At trade entry, you have the choice of the exercise method that will apply should the option end up in-the-money. Options can be converted into a spot position on expiry or cash settled. The cash settled exercise method is available on both long and short positions and will always be executed at the mid-price of the best bid/offer spread. This applied even in volatile market conditions. The exercise method can be modified up to one hour prior to expiry.
There are safeguards in place to prevent erroneous trading. Thus, for each currency pair a 'tradability value' has been set. The rationale for this parameter is to restrict your trading when the probability of the trigger being touched (or not touched) is too close to 100%. This is done to protect the client from making a mistake, e.g. paying 100% for a One Touch or selling a No Touch when the bid is 0%.
The current parameters are:
|Currency cross||Tradability value||Currency cross||Tradability value|
Please note that the tradability values are subject to change without prior notice.
You are of course never restricted from closing an existing open position, no matter what the proximity of the trigger level to current spot. Closing prices may, if close to expiry, be offered on an RFQ basis only.
You want to buy a One Touch option with 3 months to expiry and the trigger (or barrier) price is 10 pips away from the market. In this case, the Premium would be 100% (or close to) and Saxo Bank will automatically reject the trade.
Touch options of same type, expiry, and payout can net out. No other netting of Touch options is allowed.
Key Information Documents
All trading carries risk. To help you understanding the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more
Additional Key Information Documents are available in our trading platform.