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Swedbank Issue New Downside EUR/NOK Trade Recommendation via Options

EURO-NOK

Swedbank issue new trade recommendation: EUR/NOK downside bet via options

  • Buy 3m EUR put/NOK call RKO, with 10.70 strike, down-and-out at 10.15
  • RKO structure saves ~600 pips vs. Vanilla

Swedbank write that worrying signs of COVID escalation are being priced in high beta currencies, including NOK. But projections on vaccines being available at end-2020/early-2021 and support from Norges Bank could extend buying risk on dips strategies.

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