EFTA01425809

Subject: RE: GBP KO Fwd, now EURGBP AKI Fwd From: Xavier Avila Date: Fri, 22 Dec 2017 10:09:06 -0500 To: Paul Barrett < n• Cc: Martin Zeman Joshua Shoshan Stewart Oldfiel Paul, a couple of AKI ideas, that get you short EURGBP ATMS instead of ATMF but protect you up to 0.93/0.955. Prices are indicative, we can prob get you a bit better. I also attach the EMFX outlook for 2018 which not sure we sent you earlier or not, plus and EM Handbook that explains the different regulatory frameworks, products, liquidity in different EM countries. I am around today/next week if you need anything. Thanks. Xavi EURGBP Spot 0.8850 EURGBP 6m Fwd 0.8895 Sell EURGBP 6m AKI Forward Strike has the right but not the obligation to sell EURGBP at Strike 0.8850 Client American Knock In above AKI Barrier, Client is short EURGBP Call at Strike 0.9300 If we ever trade at or Sell EURGBP 6m AKI 1.5x Leveraged Forward Strike has the right but not the obligation to sell EURGBP at Strike 0.8850 Client American Knock In 0.9550 If we ever trade at or above AKI Barrier, Client is short EURGBP Call at Strike on 1.5 times the Notional From: Xavier Avila EFTA01425809 Sent: Friday, December 22, 2017 12:29 AM To: Paul Barrett Cc: Martin Zeman Joshua Shoshan ; Stewart Oldfield ‹ > Subject: RE: GBP KO Fwd After ilyrs living in UK, I got caught a bit overweight on Brexit so I am somehow short myself (or overweight GBP and clearly underweight EUR being from Barcelona!), and I am keeping it, even increased it at around 0.90, and I think is the right position although a bad Brexit result and a Tory meltdown and a Corbyn government is not an impossibility, and the results could be problematic for GBP. I did and do not like Brexit (for the UK or EU), and I am a convinced Europeanist so I would not want that UK gets a good Brexit deal as it might incentivize wrong policial movements, yet like all EU things that make the EU such a geat project, we'll find a meddle through last minute agreement that will somehow work for everyone, (both the EU and UK need each other having functioning economies), or maybe not Brexit at all, although that might be me dreaming. I remember trading EURGBP as low as .61 in early 2000s and talks of joining the EUR at fair value around .72/75. I think .90 ish prices a lot of bad news and it seems assymetric to me. I think fair value should be closer to . 80 and I would hope that when some of the Brexit uncertainties get clearer we move towards there, although I was hoping by now we would be closer to . 85 ish and things do not seem to be moving down. I know not everyone agrees with this view, but I remain overweight prob for next 3-6 months and then will reevaluate. EFTA01425810 From: Paul Barrett ‹ > Date: Thursday, Dec 21, 2017, 23:14 To: Xavier Avila Cc: Martin Zeman , Joshua Shoshan , Stewart Oldfield ‹ > Subject: RE: GBP KO Fwd I sold a GBP bond today for some tax planning so want to replace the GBP FX exposure. So you ike EURGBP downside? Paul Barrett Alpha Group Capital LLC 142 W 57th Street, 11th Floor, New York, NY 10019 From: Xavier Avila [mailto:[email protected]] Sent: Thursday, December 21, 2017 10:38 PM To: Paul Barrett a Cc: Martin Zeman •fl; Joshua Shoshan Stewart Oldfield < > Subject: RE: GBP KO Fwd EFTA01425811 Agree, not best moment to sell vol. Any reason you buying GBP? What about selling EURGBP? Better carry, les dependant on USD view if you are bullish GBP, I think 8850 still prices a lot of Brexit catastrophe scenarios. Spend the posiyive carry to buy an ATMS AKI or EKI fwd maybe? not sure how the barrier would look. Our catalan friends gave us another reason to doubt this EUR euphoria of the last months (you thought SA politics were conplicated, ha!!!) Xavier Avila Managing Director From: Paul Barrett ‹ > Date: Thursday, Dec 21, 2017, 22:13 To: Xavier Avila Cc: Martin Zeman , Joshua Shoshan Stewart Oldfield Subject: RE: GBP KO Fwd I think vol is too low to embed KOs. In fact what I do like is combining the long GBP call with a short GBP KI put (vol also too low for that right now). EFTA01425812 Paul Barrett Alpha Group Capital LLC 142 W 57th Street, 11th Floor, New York, NY 10019 S From: Xavier Avila [mailto: Thursday, December 21, To: Paul Barrett <I IMIMMa> Cc: Martin Zeman ; Joshua Shoshan ; Stewart Oldfield ‹ > Subject: GBP KO Fwd We are currently at 1.3370 so not there on the order. A little idea to cheapen it up, we can look at variations or other ideas tomorrow. Xavi GBPUSD Spot GBPUSD 6m Fwd 1.3370 1.3475 Buy 6m Forward EFTA01425813 Strike 1.3340 American Knock Out 1.4500 fcid:[email protected] Xavier Avila Managing Director I Key Clients Partners Wealth Management Americas Deutsche Bank Securities Inc 345 Park Avenue, New York, NY, 10154-0004 Key Client Partners (KCP) Americas does not provide investment advice and the products, investment ideas and solutions and related matters discussed herein are provided for discussion purposes only, and strictly on a non- advisory basis. KCP products and services are intended and available only for persons who are sophisticated institutional investors within the meaning of the FINRA Rule 4512(C)(3), and who are capable of evaluating the strategies, characteristics and investment risks of, and exercising independent judgment in evaluating, the ideas and products discussed herein. 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