The Johannesburg Stock Exchange (JSE) has rolled out exotic currency options contracts to provide investors greater flexibility in their currency bets. The two new options, known was the knock-out barrier and up and out options, are based on the dollar/rand and offer participants exchange-traded products similar to those that have previously been available only over-the-counter (OTC).
The knock-out barrier option has a built-in process to expire should a specified price level be exceeded, while the up and out variation has a barrier level above the current spot price that has to move up for the option to be knocked out. The contracts were launched in partnership with Absa Capital, the investment banking arm of South Africa’s Absa Group.
Click here for the release from Johannesburg Stock Exchange.