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Currency Derivatives

"Never keep all your eggs in one basket" - Financial markets are a classic example of this proverb. These markets all around the world in all categories and at all points of time have taught us to keep our investments diversified into various instruments. Hence, we at Kotak Securities have brought a new investment opportunity for all Resident Indians, who can now diversify their portfolio, by trading in Currency Derivatives.

Currency derivative is a contract between the seller and buyer, whose value is to be derived from the underlying asset, the currency amount. A derivative based on currency exchange rates is a future contract which stipulates the rate at which a given currency can be exchanged for another currency as at a future date.

For the first time this segment is accessible to the retail players in the

currency trading

 market. Further, Kotak Securities clients will enjoy the following major advantages:

A) Currency Derivatives (Currency Futures), Equities and Mutual Funds can be traded on one trading platform
B) Your Cash margin with Kotak Securities can be used for all the three segments
C) Exclusive research reports and seminars for Currency Derivatives Trading
 

Product Details

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  Product Details  
 

The segment will allow you to trade on the movement of conversion rate of USD / EUR / GBP / JPY with INR. Following are the basic specifications of the contracts offered.

 
 

Underlying of the contract:

 
       o  Rate of exchange between USD 1 and INR  
       o  Rate of exchange between EUR 1 and INR  
       o  Rate of exchange between GBP 1 and INR  
       o  Rate of exchange between JPY 100 and INR  
 

Contract months: 12 near calendar months

 
   

For Example - Assuming the current month to be February '10, the contracts available will be for all months from February '10 to January '11.

 
 

Expiry Date: Last business day of the month.

 
 

Minimum price fluctuation: INR 0.0025

 
   

For Example - Current USD / INR rate is INR 48.1150. The next price movement upwards or downwards would be of INR 48.1175 or INR 48.1125 respectively.

 
 

Market Timings: 09:00 to 17:00 hours

 

Position Limits:

USD / INR - 6% of the total open interest or USD 5 million whichever is higher
EUR / INR - 6% of the total open interest or EUR 5 million whichever is higher
GBP / INR - 6% of the total open interest or GBP 5 million whichever is higher
JPY / INR - 6% of the total open interest or JPY 200 million whichever is higher

 
 

How will you benefit from Currency Trading?

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  How will you benefit from Currency Derivatives?  
  The Currency Derivatives product is a bundle of opportunities for a number of players.  
 

It is a new asset class for diversification of investments for all Resident Indians

 
 

It gives hedging opportunities to:

 
   a) Importers and exporters, who can hedge their future      payables and receivables  
   b) Borrowers, who can hedge foreign currency (FCY) loans      for interest and principal payments  
   c) Resident Indians, who can hedge their offshore      investments  
 

It gives arbitrage opportunities

 
 

It gives trading opportunities because of its volatility and multiplicity

 
 

It provides highly transparent rates to traders as it is exchange-traded

 
 

 

The Kotak Securities Advantage

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  The Kotak Securities Advantage  
 

Kotak Securities is one of the initial few broking houses who are offering this product to their clients. Following are few of the benefits that you would enjoy as a customer of Kotak Securities.

 
 

Facility to our existing offline as well as online customers to trade in Currency derivatives by filling up a simple form. There is no need to open a separate trading account to trade in Currency Derivatives.

 
 

Your Cash margin with Kotak Securities can be used for all the three segments Equity trading, Mutual Funds and Currency Derivatives.

 
 

Research on Currency Derivatives that helps you take informed decisions.

 
 

Facility to place buy/sell orders through branches, internet and over the phone.

 
 

Receive education on the product through seminars/con-calls organized by Kotak Securities.

 
   

Open an Account

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  Open an Account  
 

As beneficial is the product to all investors, the process for accessing the product is also very simple. It's convenient for our existing customers as well as other investors/traders who would like to trade in Currency Derivatives.

Existing Customer - If you are an existing customer of Kotak Securities, all you need to do is fill a simple form and then start trading. Kindly speak to your Relationship Manager / visit our nearest outlet / call us on 1800 222 299 / 1800 209 9191 for the same.

New to Kotak Securities - All you need to do is open an account with us and start trading in Currency Derivatives. To open an account, visit our nearest outlet / call us on 1800 222 299 / 1800 209 9191 / fill in your information by clicking here.

 

Service Charges

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  Service Charges  
 

In addition to the agreed brokerage, statutory levies at the prescribed rates, by the government of India, would be charged.

 


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