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Qi Quan Bao (Personal Business of Foreign Exchange Option - Call Option)


 

Name

Qi Quan Bao

Introduction

Qi Quan Bao is one of individual foreign exchange options products of Bank of China. It means that customers should pay a certain amount of option premium to Bank of China to buy the option (call options or put options) of the corresponding face value, term and exercise price based on their judgment on future direction of foreign exchange rates. On option maturity date, if the exchange rate changes are in favor of customers, the customers can get higher earnings by exercising options; otherwise, the customers may choose not exercising the option.

Trading hours GMT (Beijing Time) from 10:00 to 16:30 on each business day, and is closed during international financial markets closure.

Trading currency: The straight transaction and major cross transaction of USD, EUR, JPY, GBP, AUD, CHF and CAD, both cash and currency are accepted.

Threshold amount is set for the face value of options as per specific conditions.

The target foreign exchange rate of the foreign exchange options trading is EUR against USD, USD against JPY, AUD against USD, GBP against USD, USD against CHF, USD against CAD.

Large-scale customers can also choose cross foreign exchange rate among non-US currencies as the target foreign exchange rate.

Trading term: The term varies from six months to one day. The specific term is determined as per the maturity date in option quotation published by Bank of China on that very day.

Our Advantages

Low threshold; abundant structures of each term; three exercise prices are available for selection; the commissioned entry orders and unwinding in advance are supported; provide the quotation of main cross transaction.

Target Customers

All natural person who opened foreign currency accounts in Bank of China, with full civil capacity, can apply for personal foreign exchange options business of Bank of China . Please go to the branch of Bank of China to carry out the business in person.

Process

To open the foreign currency accounts in Bank of China(current); Personally go to the Bank of China financial center to sign Foreign Exchange Option Trading Agreement with Bank of China; the Bank of China deduct customer option premium; on the expiration date, the Bank of China will conduct the fund delivery see whether implement the option or not.

Call option from the bank. You can make selection as per your judgment on future direction of foreign exchange rates:

1. Linked currency, another currency available for your delivery on the maturity date

2. Face value of option, the amount of foreign exchange transaction on the maturity date of the option

3. Maturity date of option, the maturity date specified in the agreement

Bank of China will reach agreement on foreign exchange rate with you (the foreign exchange rate, agreed by the two parties in Agreement on Foreign Exchange Option Transaction, is adopted by the buyer on the option maturity date in exercising foreign exchange transaction), and you pay a certain amount of option premium to Bank of China.

On the option maturity date, the bank will exercise option on behalf of you, if the exchange rate change is in your favor; if the foreign exchange rate changes against your favor, you may choose not to exercise the option, the loss is limited to option premium. If the maturity date is on non-banking day or relevant holidays of the international market, the maturity date should be adjusted as per international market practices.

Risk Disclosure

Is "Qi Quan Bao" suitable for you?

On the maturity date, if the foreign exchange rate is in your favor, you should exercise the option; otherwise, you should not exercise it, with risk locked and cost locked, meanwhile you have the opportunity to obtain the spread in foreign exchange transaction.

You may consider applying for this business if you are in one of the following cases:

1. You need to use the linked currency in the future, meanwhile you worry about the risk of exchange rate change in the future;

2. You need to maintain the value of the foreign currency funds in your hands;

3. You have a lot of foreign exchange deposits, but have no time for Wai Hui Bao investment.

Since any investment product bears risk features, investors should understand the risks of transaction, and consider individual risk tolerance as well as expected returns, before making decisions on transaction.

Above information is for reference only. The specific business types and the procedure should be determined as per relevant regulations of the local branch of Bank of China.

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