On speculation basis, we recommend buying one touch vega calls in order to extract leverage on extended profits. As you can see from the nutshell showing volatilities of ATM contracts (EURUSD - 6 months contracts show 9.65% while AUDUSD at 11.3%), Vega on EURUSD is comparatively on higher side with cable which may have relative delta effects,The prime merits of such one touch option spreads are high yields during high volatility plays.
Wider spreads indicates lack of liquidity. The spreads for one touch EUR/USD options are constant time and barrier levels. We believe one touch Vega spreads can be the best suitable options to trade HY vols. Usually, such binary options for every change in 1 pip the relative change in option price 0.01% or even exponential at high implied volatility times. For such disparity in volatility between these currency crosses hedging framework would be advocated in our upcoming posts, for traders and hedgers of cable experiencing low volatility, so by employing these Vega options one can not only multiply the returns by twice, thrice or even pour returns unimaginably but also upbeat the implied volatility. But do remember this call is strictly on speculative grounds.
