Interest Rate Options - Interest Rates - Markets - ICAP.com

Interest Rate Options

The interest rate options market is one of the most important hedging mechanisms available and is used extensively by a wide variety of industry participants.

In London ICAP has a strong presence in these markets and provides a full voice broking service to our customer base.

An Interest Rate option provides the holder with the right, but not the obligation, to buy or sell a given bond or futures contract at a fixed price on or before a specific date. Options are written on Government bonds and are traded OTC.  They are generally used to hedge exposure on a bond portfolio.