In exchange for the payment of the option fee (premium), the interest rate option, similar to the currency option products, offers you protection against unfavourable changes in the interest rate environment, while you can benefit from the interest rates favourable to you.

Buying a cap option makes sure that in an upward yield environment, the interest of a variable rate loan will remain below a predetermined level (the strike price)

  • If the reference rate fixed for a given period is higher than the interest rate fixed in the cap transaction, the client receives the difference between the two interest rates per principal.
  • If the market rate is lower than the cap rate, then no movement of money occurs.

Floor option: the buyer of the option acquires the right to receive the difference in the principal if the reference rate fixed for that period is lower than the interest rate specified in the floor option. If the reference rate is higher, no movement of money occurs.

A collar transaction consists of buying a cap option and selling a floor option, allowing the client to keep their floating rate within a predetermined range, making it possible to plan the company's finances efficiently.

With the purchased option, you acquire protection against interest rate movements in a direction unfavourable to you, while with the option sold, you reduce the value of the protection option fee (premium), in return limiting your profit from favourable interest rate movements. The collar transaction fee is actually the difference between the cap and floor option fees, i.e. the desired protection range can be achieved even at no cost by selecting the cap and floor levels accordingly (purchased cap and written floor).

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Useful documents

These documents in English language to the person concerned shall be for information purposes only. OTP Bank Plc shall fulfil its obligations imposed by the legal regulations or requirement of supervisory authority by the documents in Hungarian language.
In the event of any discrepancy between the English language and Hungarian language versions, the Hungarian language version shall prevail.

Information on the suspension of the market making obligation (available only in Hungarian)

Commodity swap

Cross-Currency Interest rate swap

Dual currency structured investment

Foreign exchange option

Foreign exchange swap

Forward deal in precious metals (gold and silver) transaction

Forward foreign exchange

Interest rate option

Interest rate swap

Long-Term Investment Account T+3 FORWARD

Spot securities transaction

Stock exchange futures

Stock exchange spot transaction

Securities Lending Transaction

Foreign exchange Orders

Subordinated Securities

EMIR Announcement

EMIR Information for Clients

Notice on the uEMIR Notice se of LEI CODES

Disclosure of information pursuant to Article 11 (11) of the EMIR Regulation

Information for Clients on MiFID

Global Markets ex-ante cost transparency information (available only in Hungarian)

The data to be published on the quality of execution of transactions according to Commission Delegated Regulation (EU) 2017/575 (available only in Hungarian)

Information on the identity of execution venues and on the quality of execution according to Commission Delegated Regulation (EU) 2017/576 (available only in Hungarian)

Systematic internaliser - quotes

Notice on the use of LEI CODES

Direct and indirect clearing services in respect of certain derivative transactions announcement

Key Information Documents – PRIIPs KIDs

Notice - on the impacts of the pandemic emergency on the money and capital markets

Notice - on the collateralisation of long-term investment combined securities account and long-term investment securities account - cash accounts

Notice - about transactions in chinese yuan (RENMINBI)

Terms and conditions and Announcements

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