India started its structural foreign exchange
reforms way back in the 90's and gradually shifted to a
managed floating system with RBI intervention. Currently
there is an active OTC market with Spot and Forward trades
in big quantities. The participants for such trades range
from banks to international traders with underlying currency
risks. Such a crude market sees a daily volume of around USD
33 billion, throwing open enormous opportunities.
The advent of global trade and integration of
financial markets, backed with progressive flow of capital,
have transformed the dynamics of Indian financial markets.
With a view to enable entities to manage volatility in the
currency market, RBI has approved Foreign Exchange Currency
Futures on the exchange platform. Currency Derivatives help
players manage foreign currency risk, better.
The following chart depicts USD-INR exchange rate
movement since 1991.
OTC VIS - A VIS Exchange futures
Though futures generally solve the same purpose as
OTC and Forwards, yet they do the same with added benefits
over OTC:
Better Transparency
Better Price Dissemination
Better Risk Management - Mark to Market
Counter Party Guarantees
Equal opportunity to all class of investors -
large or small
Best Time - Price combination available
Better Correlation with Global Prices
Better Correlation with Global Prices
Currency Futures & Risk
Management Strategy
As a one - stop - shop for all financial services,
Kunvarji group has been enriching its product basket from
time to time.
With the launching of Currently Derivatives in
India, Kunvarji Finstock Pvt. Ltd. has initiated providing
currency trading platform to its wide network of clients
& traders. This initiative is intended to benefit a
large number of financial market participants, including
hedgers (i.e. exporters, importers, corporates and bankers),
investors and arbitrageurs.
Kunvarji, Standing Tall for the
Trust & Bond of Intelligent Investing.
