A Currency Futures (CFs) Contract is an agreement that gives the investor the right to buy or sell and underlying currency at a fixed exchange rate at a specified date in the future. One party to the agreement agrees to buy (longs) the Future at a specified exchange rate and the other agrees to sell (shorts) it at the expiry date. The underlying instrument of a CFs Contract is the rate of exchange between one unit of foreign currency and the South African rand. Contracts are cash settled in rands and no physical delivery of the foreign currency takes place.
Investors, importers, exporters and travellers can use CFs to hedge themselves against movements in the exchange rate. Speculators use CFs to make a profit on short-term movements in prices. Arbitrageurs use them to profit from the price differentials of similar products in different markets. Some investors trade CFs to enhance the performance of a portfolio of assets over the long term.
Register as a client with
an authorised JSE Currency Derivatives member, deposit the required initial margin and sell or buy according to your needs.