Calls on low yielders overpriced
JP Morgan research has shown that, in most cases, calls on low-yielding currency are overpriced by at least two standard deviations over puts, when compared with historic levels.
"There seems to be a demand for the low-yielding currencies above the norms we have seen on a historic basis," said Kamal Sharma, G-10 currency strategist at JP Morgan in London. "The US dollar also seems to fall into the category of a low-yielding currency. Looking at the movements we have seen, there has been a
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