How to trade FX options online in the Middle East?

FX options are an over-the-counter derivative that gives the right but not obligation to buy or sell a currency pair at a predetermined rate on (or before) a specific date. A call option gives the right to buy a currency pair at a specific rate, while a put option grants selling rights. In both cases, they are traded in lots and never for individual units – one lot is equal to 100,000 units of the base currency being bought or sold.

How to trade FX options online in the Middle East?

Create an account with a brokerage firm

Most brokers do not require in-person registration and typically offer 24/5 customer service. To log into your account after it is created, go to the broker’s website and type in your username and password. You can find a broker here: Saxo broker Saudi Arabia.

Deposit funds into your trading account

Your broker will provide you with deposit options based on the type of currency you wish to use for transactions. For example, if you are depositing dollars, they can be wire transferred from a US bank or sent via MoneyGram. If using dirhams, there are various ways to transfer money depending on which country you are sending it to. Withdrawals are usually processed through the same means as deposits for easy management of all transactions.

Choose an expiry date for your option

Most brokers offer weekly, monthly and quarterly options, but it is always best to check with them which products are available in your region. FX options typically expire on Fridays or the last working day of the month at 5 pm EST, depending on which broker you use. You can choose any date within these timeframes to trade your option contracts.

Buy Calls/ Puts using your newly deposited funds

When you log into your account, there should be a section dedicated only to trading currencies – this is where you will buy and sell all Forex future contracts. Select “FX Options” and select the currency pair you wish to trade (Eg: EUR/USD) and choose “Option” or “Call”. You can also purchase a contract by clicking on an existing open transaction.

Set up stop-loss orders for all your contracts

Most brokers offer this service, but it is done through different means, so the best way is to contact their customer support team directly. The stop-loss order allows you to predetermine at what rate will your option be closed if the market goes against you so that your losses are limited to just that amount of money.

Set up an alert for your contracts

Your broker will typically offer a text message service that notifies you when a specific contract is about to expire. Still, it is best to check their website directly as different options may be available depending on what region you are trading from. It allows you to monitor rates at all times and lock in profits immediately before the contract expires if the market moves favourably towards you.

Closeout your contracts as soon as they hit 100% of their value

When this happens, open a new transaction and select “Close”. You can also close out transactions by clicking on existing open deals so that there is no need to monitor the market continuously. You can withdraw the total amount earned after closing all deals to your bank account.

Benefits of trading forex options online

No need to monitor market fluctuations continuously

Once you’ve set up your stop-loss orders, you don’t have to spend time monitoring changes in rates or refreshing charts – all you have to do is wait for an alert telling you when it’s time to close out your position. If you’re new, this system makes it easier for beginners unfamiliar with market fluctuations.

Risk is limited to the amount of money invested

Unlike margin trading, you can’t lose more than your principal investment with FX options as losses are predetermined, allowing investors to enjoy peace of mind even when trading without prior experience. There’s no need to rush into transactions, and there is an option for a refund if you think the deal won’t work out in your favour.

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