The main function of enterprise foreign exchange rate currency swap options: taking buying foreign exchange rate swap options as an example. Before the future loan (or investment) is signed, the market interest rate may change in an unfavorable direction. Companies can use swap options to hedge loans (or investments), that is, hedge contingent risk exposure through swap options. Under the premise of paying a certain fee (option fee), the debtor (or investor) can get more flexible protection, that is, when the market develops in an unfavorable direction, he can exercise the option, that is, make the interest rate swap transaction take effect according to the pre-agreed level, thus locking in the interest rate risk; When the market conditions develop in a favorable direction, you can choose not to exercise options, enjoy a better market interest rate or lock in risks at a more favorable time.

The above contents are for your reference. Please refer to the actual business regulations.

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