Currency Options

[Rahultat]

Anyone who is doing Currency options trading can post here. Share your experiences which will help everyone.

 

[soft_trader]

I trade in currency options. You may post your queries.

 

[Rahultat]

What is the best way to trade currency options and do weekly currency options have liquidity

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[soft_trader]

What is the best way to trade currency options and do weekly currency options have liquidity

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There is no best or worst way to trade.

Current week and monthly expiry contracts have good liquidity.

One thing I have learnt is that, in currency options, take whatever the profit you have on the table, because these options have the tendency to reverse.

 

[Rahultat]

Which is more suitable, hedging or directional trades? Also can we take decay advantage in weekly OTM contracts by hedging.

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[soft_trader]

Which is more suitable, hedging or directional trades? Also can we take decay advantage in weekly OTM contracts by hedging.

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Hedging will be better IMO.
Yes, you can.

 

[Rahultat]

In IMO hedging, the decay will be slow right? Can you please elaborate how IMO hedging will help. If you could share with example that would be very helpful.

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[soft_trader]

In IMO hedging, the decay will be slow right? Can you please elaborate how IMO hedging will help. If you could share with example that would be very helpful.

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Hedging is better because it limits your losses and provides protection to some extent against gaps.