Forex options you can actually exercise?

[Rob in]

Greetings all, sorry if I missed this in a search here but...

... Does anyone know of any online brokers/platforms where when one takes a position in a forex option and it's ITM at maturity you can actually exercise that option and get the actual currency.

I know OzForex offer something like this, but you have to call in for a quote and I've noticed their rates are very poor lately (something to do with this now being a publicly traded company?)

Platforms like Saxotrader will let you deal in forex options but you can never actually exercise these and get the currency. Even with a 'spot' trade at maturity on that platform you end up with a long position in the foreign currency and have to sell that (which will be priced in AUD) and then convert any profit (assuming you made a profit) plus your original AUD into the foreign currency using whatever means you like (Saxo will convert between multi-currency sub-accounts at spot minus 0.5%).

So that makes Saxotrader a similar experience to CFDs, etc? Or did I miss something?

Call me old fashioned, but when I purchase an option to buy currency at a given price on a given date I'd actually like to do that without incurring extra fees and charges

Any tips on where to find this?

 

[Andyasu]

Greetings all, sorry if I missed this in a search here but...

... Does anyone know of any online brokers/platforms where when one takes a position in a forex option and it's ITM at maturity you can actually exercise that option and get the actual currency.

I know OzForex offer something like this, but you have to call in for a quote and I've noticed their rates are very poor lately (something to do with this now being a publicly traded company?)

Platforms like Saxotrader will let you deal in forex options but you can never actually exercise these and get the currency. Even with a 'spot' trade at maturity on that platform you end up with a long position in the foreign currency and have to sell that (which will be priced in AUD) and then convert any profit (assuming you made a profit) plus your original AUD into the foreign currency using whatever means you like (Saxo will convert between multi-currency sub-accounts at spot minus 0.5%).

So that makes Saxotrader a similar experience to CFDs, etc? Or did I miss something?

Call me old fashioned, but when I purchase an option to buy currency at a given price on a given date I'd actually like to do that without incurring extra fees and charges

Any tips on where to find this?

most of those online trading platform is CFDs trading, so I am not sure what you mean by incurring fees or charges when you buy a currency. r u saying that you are looking for something without any extra charges when trading currency?

 

[Rob in]

most of those online trading platform is CFDs trading, so I am not sure what you mean by incurring fees or charges when you buy a currency. r u saying that you are looking for something without any extra charges when trading currency?

What I mean is this... I can buy an ATM call option for USD on a particular trading platform. I pay in AUD. Let's say the AUD falls, so my option to buy USD is now ITM. So my ITM option has appreciated in value. The platform lets me sell that but at a value that is still priced in AUD. At expiry if this is exercised I will end up with a long USD position, but still priced in AUD.

In this example, I don't want to be long USD priced in AUD - I was the actual USD. On this platform I would have to close the USD position (at a profit in the example). I now have to go to a forex broker and by some physical USD using the AUD I originally started with plus the profits from this trade.

It's convoluted to say the least.

Making that actual USD exchange incurs fees and charges - but if I can actually get real USD when the option expires these would be avoided.

 

[James Martin]

GE Money offers a MasterCard, which has no fee when you exchange money into another currency.

Greetings all, sorry if I missed this in a search here but...

... Does anyone know of any online brokers/platforms where when one takes a position in a forex option and it's ITM at maturity you can actually exercise that option and get the actual currency.

I know OzForex offer something like this, but you have to call in for a quote and I've noticed their rates are very poor lately (something to do with this now being a publicly traded company?)

Platforms like Saxotrader will let you deal in forex options but you can never actually exercise these and get the currency. Even with a 'spot' trade at maturity on that platform you end up with a long position in the foreign currency and have to sell that (which will be priced in AUD) and then convert any profit (assuming you made a profit) plus your original AUD into the foreign currency using whatever means you like (Saxo will convert between multi-currency sub-accounts at spot minus 0.5%).

So that makes Saxotrader a similar experience to CFDs, etc? Or did I miss something?

Call me old fashioned, but when I purchase an option to buy currency at a given price on a given date I'd actually like to do that without incurring extra fees and charges

Any tips on where to find this?