The forex option brokers can be split into two categories, click this link: forex brokers that offer online forex option trading platforms, and forex brokers that only allow traders to trade via telephone through a broker/dealing desk. Some forex option brokers also offer live forex option brokerage and online forex option trading.
Different forex brokers have different trading account minimums. These can range from less than a thousand dollars to more like fifty thousand. A forex option broker may require traders to trade forex options contracts of minimum notional value (contract sizes) greater than $500,000. Last but not less, certain types forex option contracts may be open for trading and can be withdrawn at any time. Other types lock you into until expiration or settlement. Depending on what type of forex option contracts you choose, you could be stuck in the wrong place if you trade out of an option contract. Investors should talk to their forex brokers before trading about the minimum trading account requirements, minimum contract size, and contract liquidity.
Forex option brokers can offer investors a wide range of forex option trading products. The risk characteristics for each of the forex option products listed below are very different and should be understood by investors.
Plain Vanilla Forex Options Broker. Plain vanilla options usually refers to standard call and put option contracts traded through a exchange. However, for forex option trading, it would refer to standard, generic options contracts that are trade through an OTC forex dealer (clearinghouse) or forex dealer. Vanilla forex options could be described in simplest terms as buying or selling standard forex call option contracts, or forex put option agreements.
Only a few forex broker/dealers provide plain vanilla forex options online with streaming quotes that are available 24 hours a week. Forex brokers and banks mainly only offer options for forex trading via telephone. Vanilla forex options in major currencies have great liquidity. You can enter the market short or long and exit at any time of day or night.