Forex Exotic Options Basic Strategy

[riskarb]

Is refcospot still in business after the big crash? Did they get bought out?

FXCM is offering the former REFCO SPOT functionality. www.fxcm.com

 

[riskarb]

Based on your premiums you need to have a win:lose ration of more than 2:1. Do you think this is achievable? Most people talk about 50:50 ratios and a mixture of money management and big wins to see through. Just curious on your thoughts as this is what put me off these kind of vehicles.

2:1 "win loss" on short gamma is only achievable with double no touch barriers, and it's very rare where you'll see a 2:1 payout outside of a half-sigma. I can state with confidence that I've never traded a 2:1 payoff in a barrier option -- the touch probability is very high. Sure, you can trade within one sigma for kicks, but nobody would lay serious cash on such a bet.

You'll never find a single NT, short gamma "all or nothing" barrier exotic trade at 2:1 "win-loss". By their nature they produce poor risk-reward payouts. An ATM touch market is null by definition.

 

[tehewo]

did anybody tried IB in forex option? have been in equity option for close to 3 years and trade forex with refcofx until all my fx monies gone with refcofx and now looking into possible forex option using ib.

 

[riskarb]

did anybody tried IB in forex option? have been in equity option for close to 3 years and trade forex with refcofx until all my fx monies gone with refcofx and now looking into possible forex option using ib.

Interactive Brokers? They only offer exchange-traded options.