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CONTRACT
- Specifications –
1. Definitions
Purchase of a contract: A transaction where the participant is the holder, that
is, the participant has the right to buy the underlying
contract at the strike price.
BM&FBOVESPA Exchange
Rate Benchmark (TxC): The exchange rate of Brazilian Reals per United
States Dollar, calculated by BM&FBOVESPA for
settlement in one (1) day, as published in its website.
3. Price quotation
Option premium in Brazilian Reals per 50-net kilogram bag to two decimal places.
4. Tick Size
BRL0.01 (one cent of a Brazilian Real) per 50-net kilogram bag.
5. Contract size
Each option contract is based on one Cash-Settled Crystal Sugar Futures Contract,
the round lot of which is 508 bags, weighing 50 net kilograms each, being equivalent
to 25.4 metric tons.
6. Strike prices
Strike prices shall be established and published by BM&FBOVESPA expressed in
Brazilian Reals per 50-net kilogram bag.
7. Contract months
February, April, June, September and December.
8. Expiration date
The 15th of the contract month. If this is not a business day, the expiration date shall
be the following business day.
𝐕𝐋𝐏 = 𝐏 × 𝟓𝟎𝟖
where:
VLP = the premium cash settlement value per contract, in Brazilian Reals;
P = the option premium expressed in Brazilian Reals.
Cash settlement shall be on the business day following the expiration date.
The exercise of an option means that the buyer shall enter into a long position on
the Cash-Settled Crystal Sugar Futures Contract and the seller shall enter into a
short position on the Cash-Settled Crystal Sugar Futures Contract, both at the
corresponding strike price.
14. Collateral
Collateral, whose amounts shall be calculated in accordance with the criteria
published by BM&FBOVESPA, shall be required from all option writers and may
be updated daily. Margins shall be due on the first business day following the trade
date. For nonresidents, should the first business day following the trade date be a
banking holiday in New York, collateral shall be due on the first day following the
trade date when there is no banking holiday in that city. When the conversion of
cash collateral is necessary, it shall be subject to the provisions set forth in item 15,
where applicable.
a) For residents
The amounts shall be in Brazilian Reals, in accordance with the procedures
established by the BM&FBOVESPA Clearinghouse.
b) For nonresidents
The amounts shall be payable and receivable in United States Dollars in New
York, USA, through the settlement bank appointed by BM&FBOVESPA, in
accordance with the procedures established by the BM&FBOVESPA
Clearinghouse.
The conversion of amounts resulting from day trades, of amounts resulting from
premiums and of the conversion of margin requirements deposited in US
Dollars, the BM&FBOVESPA Exchange Rate Benchmark of the trade date
shall be used.