GBP/USD risk reversals drop to two-month low

Omkar Godbole FXStreet Contributor

One-month risk reversal on GBP/USD, a gauge of calls to puts, has dropped to -1.75, the lowest level since Sept. 25, extending the drop from the peak of -0.90 observed on Nov. 17, according to data source.

The negative risk reversal results from put options or bearish bets drawing stronger demand than calls (bullish bets).

As such, the latest drop in the risk reversal indicates investors are adding bets to position for weakness in the British Pound.

GBP/USD is currently trading near 1.3364.

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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