| Parameter | Call Premium | Put Premium |
| Exchange Rate | As exchange rate increases call premium also increases | As exchange rate increases put premium decreases. |
| Strike Price | As strike rate increases call premium decreases | As strike rate increases put premium also increases |
| Risk Free Interest Rate | As the interest rate in the economy increases, value of call option increases | As the interest rate in the economy increases, value of Put option decreases |
| Time to maturity | Call & Put options become more valuable as time to maturity increases, it is because of Risk as the time increases. | |
| Volatility | As volatility increases there is high degree of uncertainty about the rate of the currency and hence on the option. The owner of the call benefits from the rate increase and that of the put benefits from the rate decreases. | |
Join us and meet our experts and learn about our Hedging Strategies - Hyderabad
More details
