FX option calculator
See what a currency option does for a payment you have to make or money you expect to receive: the worst case it locks in, the break-even rate after the premium, and how it compares with no cover as rates move. Free, no sign-up, nothing leaves your browser.
- 1Type in your own numbers
- 2The tool works it out
- 3See the answer clearly
Enter the agreed rate and premium your provider quotes; the starting numbers are only an example. Change the market rate to try different outcomes. This shows outcomes, it doesn't price options, and it isn't advice.
| Market rate | With option | No cover |
|---|---|---|
| 0.7740 (-10%) | £78,400.00 | £77,400.00 |
| 0.8170 (-5%) | £82,700.00 | £81,700.00 |
| 0.8428 (-2%) | £85,280.00 | £84,280.00 |
| 0.8600 (0%) | £87,000.00 | £86,000.00 |
| 0.8772 (+2%) | £87,000.00 | £87,720.00 |
| 0.9030 (+5%) | £87,000.00 | £90,300.00 |
| 0.9460 (+10%) | £87,000.00 | £94,600.00 |
How an FX option works
An FX option gives the buyer the right, but not the obligation, to exchange one currency for another at a fixed rate on or before a set date. You pay the premium up front. If the market rate ends up worse than your agreed rate, you use the option; if it is better, you let it expire and exchange at the market rate instead.
Options versus forwards
A forward contract locks in a rate and must be used, whether the market moves for or against you. An option protects against bad moves while letting you benefit from good ones, but that flexibility costs the premium, which is not returned if the option goes unused.
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SendPay doesn't offer FX options, forwards or other hedging products. SendPay platforms include GBP, EUR and USD accounts and currency exchange for payments, where the platform owner sets their own exchange fee.