Margin normally varies from 2.5%* to 5%*, depending upon currency pairs and volatility. USDINR has the lowest margin of all currency pairs.
9 am to 5 pm – more time to react to market development
NO STT / CTT – Keeping the overall transaction cost lower
USDINR 1 lot = $1000, which in INR terms comes to approx. 74000 to 75000, depending upon exchange rate of the day.
In addition to monthly, weekly options also available in USDINR and other INR pairs, expiring every Friday. All contracts expire at 12:30 pm at FBIL Reference Rate.
Can take position in auto expiry
You Pay ZERO brokerage on all currency intraday trades under our Trade Free Plan. You get to trade unlimited in currency contract at ZERO transaction cost.
For Carry forward trade you will be charged Rs. 20 per order executed
Open your trading account in less than 60* minutes
Same margin (cash or stocks) can be used for trading across all asset classes (currency, commodity and equities)
Exclusive research reports and seminars for currency derivatives trading that help you to take informed decisions.
Enrich your trading experience with Kotak’s
Enjoy trading across currencies, equities, commodities segment
Ever wondered which is the biggest and most liquid market in the world. It is not equites or commodities but foreign exchange market, also known as FX, forex, or currency market. Globally, trading in currencies primarily takes place in Over-the-Counter (OTC) market, where large financial institutions, corporate and hedge funds trade amongst each other depending upon their requirement. While corporate mainly use this market to hedge their underlying FX exposure on account of export/import, hedge funds and financial institutions use for trading or hedging their overseas investment. What makes FX market unique is its round the clock trading, liquidity, depth and leverage.
Currency trading at its most basic form is trading in currency of one country vs another. For example: USDINR where, dollar is the currency of US and INR is the currency of India. It is also known as foreign exchange marketor forexmarket. It is said to be the largest market in the world because of its size. Its daily turnover stood around USD 6.59 trillion. (Source: BIS Triennial Survey 2019), more than any other asset class.
The best part is that you can start trading in currency pair (USDINR) with as little as Rs. 2,000* margin money.
Currently, there are seven currency pairs available for trading on the Indian Exchanges:
*Note: This is an indicative margin applicable in USDINR contract per lot. However, it can be different at the time of actual transaction.
A) Currency trading – at its most basic definition - is the simultaneous Buy/ Sell of one currency against another. It is like pair trading (USD vs INR).
For example – if USD/INR is trading at
and if one Buys at 74.51, it means he/she is bullish on dollar (bearish on INR). Similarly, if one sells dollar, it means bearish on dollar (bullish on INR).
A) Exchange Traded Currency Futures and Options is like any other derivatives contract (NIFTY, Bank NIFTY) that gets traded on exchange having fixed contract size and expiry date.
A) Presently, there are 7 currency pairs available in futures and options:
|INR Currency Pairs|
|International Currency Pairs|
A) Exchange traded Currency Futures & Options has not only opened a new asset class to the individuals but also gives opportunity to express their price view on USDINR and other currency pairs. Some of the advantages of Exchange Traded Currency Futures & Options are as follows:
|Indicative Margin Requirement|
|Nifty||18% - 20%|
|Gold||8% - 10%|
|USDINR||2.50% - 3%|
A) Indicative margin in different currency pairs as follows:
|Indicative Margin||2.5% to 3%||3% to 5%||3% to 5%||3.5% to 5%|
For example – for one lot of USDINR, margin requirement would be in the range of Rs. 1,875 (75000 * 2.5%) to Rs. 2,250 (75000 * 3%).
A) Margin can be given in the form of cash or approved securities with applicable hair-cut. In fact, one can use the same margin given for equity F&O provided he/she is activated to trade in currency segment.
One can trade in the multiples of the above lots both in futures and options.
|INR Currency Pairs||International Currency Pairs|
|1 Lot =||$1000||€ 1000||£1000||¥100000||€ 1,000||£1000||$1000|
|INR Currency Pairs|
|1 Lot =||$1000||€ 1000||£1000||¥100000|
|International Currency Pairs|
|1 Lot =||€ 1,000||£1000||$1000|
For example – If USDINR is trading at 74.50, value of one lot = ($1000 * 74.5050 = 74505). If EURINR is trading at 87.35 value of one lot = (€1000 * 87.3525 = 87352.50)
A) Minimum tick size is 0.0025p across all futures and options contracts.
Basically, it means that in one tick, maximum price movement is Rs. 2.5 (1000 * 0.0025).
A) Currency futures and options market trade from 9 AM to 5 PM, Monday to Friday.
A) Both futures and options are cash settled.
Daily settlement happens as per the last half an hour weighted average price.
However, final settlement for monthly contracts happens at FBIL reference rate at 12:30 pm. Unlike equity, which expires on last Thursday of every month, currency futures and options contracts expire two working days prior to the last business day of month.
For example, if Sep 30, 2020 (Wednesday) happens to be last working day of month, September futures and options contract would expire on Sep 28, 2020 (Monday) at 12:30 pm at RBI reference rate declared by FBIL.
Weekly option contracts expire every Friday at 12:30 pm at RBI reference rate.
A) Price movement in any currency pair is an outcome of many factors, ranging from geo-political risk (like Indo-China border issue) to macro developments (fiscal deficit, trade deficit, inflation etc.) to overall risk sentiment. However, short term price movements in USDINR is mainly influenced by
|Capital flows||Higher the inflows, positive for USDINR|
|Higher the outflows, negative for USDINR|
|RBI Intervention||RBI intervenes on both sides (buy and sell) to smoothen the extreme movements in USDINR.|
|Dollar Index (DXY)||Stronger the DXY, stronger the dollar|
|Weaker the DXY, weaker the dollar|
|Global Risk Sentiment||Higher the risk-on sentiment, positive for USDINR|
|Lower the risk sentiment, negative for USIDNR|
Global risk sentiment – A global risk-on sentiment is normally seen as positive for emerging market currencies like USDINR etc. One can look at other emerging market currencies like USDCNY, USDKRW, USDIDR, USDZAR etc. to gauge the likely price movement in USDINR. It is similar to how equity market participants’ looks at global equity indices and tries to gauge the intra-day move in local equity market.
Trade and current account balance - A worsening trade deficit (export < import) is negative for rupee. Whereas an improving trade balance, is positive for INR. Crude oil has a large share in Indian import basket and hence its movement does impact USDINR.