KFH Option-i provides the customer which a unique hedging mechanism which provides the customer with a protection against adverse market movements whilst concurrently retaining the benefit of a favorable market movement. KFH Option-i, applies the Shariah concepts of Waad, Bai’ and Tawarruq with strict guidance from the KFH Shariah Board. Thus, via KFH Option-i, a customer is able to hedge an exposure in a Shariah compliant manner.
- Call Option – it is the right to buy a specific underlying e.g. foreign currency or shares at a specific price on a specific future date. For example, the customer buys a call option to buy USD1 million in exchange for MYR 4.08 million at an exchange rate of 4.0800 in one month.
- Put Option - it is the right to sell a specific underlying e.g. foreign currency or shares at specific price on a specific future date. For example, the customer buys a put option to sell USD1.0 million in exchange for MYR 4.08 million at an exchange rate of 4.0800 in one month.
Subject to the terms and conditions, which includes but is not limited to the required documentation and/or limits, prior to a transaction.