Deutsche Touts MXN/RUB Structure

May 08, 2012 - Beth Shah

Read More: Deutsche Bank·

Deutsche Bank is advising investors to sell three-month at-the-money forward U.S. dollar/Russian ruble puts versus buying 3-month 1% out-of-the-money forward USD/Mexican peso puts.

“Instead of trading outright MXN/RUB cross, we favor option implementation since it protects us from further slide in MXN/RUB by giving up profit from an unlikely scenario,” Jack Zhang, emerging markets strategist at Deutsche Bank, in New York, told DI. “MXN was undervalued based on our valuation model while RUB was more in line,” added Zhang, referring to....

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