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Illustrative Examples
| Deposit Currency: | USD100,000 |
| Linked Currency: | EUR |
| Tenor: | One Week |
| Spot Rate: | 1.3360 |
| Option Two : Customised Initial Exchange Rate which is higher than spot rate | |
|---|---|
| Initial Exchange Rate: | 1.3260(i.e. EUR = USD1.3260) |
| Interest Rate of Deposit (Interest Return): |
0.125%p.a. (USD2.40) |
| Option Premium Rate (Option Premium Return): |
12.5%p.a. (USD243.10) |
| SCENARIO Three: | EUR weakens slightly against USD |
| FINAL EXCHANGE RATE: | 1.3260 |
| Payment Currency: | USD |
| Maturity Balance Calculation： |
Principal + Interest Return + Option Premium Return: |
| Maturity Balance: | USD100,000+USD2.40+USD243.10 =USD100,245.50 |
| Gain: | USD245.50 |
| Annualized Return:: | 12.63% |
Note:
The Spot Rate is the mid-price of buying and selling the currencies.
The related tax to be withheld is not shown in the above example.
The example shown is for reference only and shall not constitute any representation or warranty by the Bank in respect of any possible gain or loss.
