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Ricardo33

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  1. I am due a payment in USD in March 23, and want to lock in the current GBP / USD rate. I can see three ways to do this: 1. via a simple DFB spread bet, short USD (to match the asset value due in March 23) but this is probably expensive with daily rollover and admin charges. 2. via a future spread bet (March 23), short USD. This looks very attractive today since the rate is good and spread very small, but does the spread widen progressively as the contract nears maturity to cover the funding costs etc.? If so, can I try and calculate this today? 3. Via a traditional option, buy a USD Put maturing March 2023 (all available on IG I think). This looks expensive today (about 5%), but doesn't require margin calls over the contract period (1. and 2. do require margin calls and I have enough GBP today to cover those). The IG dealing page for options, does show a margin requirement, but I assume this actually means a premium to pay on the transaction, rather than a margin? I am trying to understand the mechanics of each (particularly how the price / spread on the March 2023 Future Spread Bet can be expected to change over time and whether the Option is a traditional option with no further action until maturity). Thanks!
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