Say I'm trading cable, currently GBPUSD = 1.45I'm looking to trade the inverse, i.e. the payoff of 1/GBPUSD = 0.6896, paid off in GBP. So, say GBP strengthens to GBPUSD = 1.65, my inverse position goes down to 1/GBPUSD = 0.606 and I lose £0.0835 per contract, rather than the $0.20=£0.12 I would have lost if I had shorted GBPUSD. Are there any contracts, ETF's etc. available that can perform this type of trade (in particular 1/EURUSD and 1/EURBRL, paid in EUR)? Would it be better to try to replicate this non-linear payoff using options?Thanks in advance for your help.

I believe you mean USD 0.20, not £0.20. USD 0.20 is equivalent to £0.12

Yes, thanks. Post edited to make better sense.

What you are describing is known as a quanto forward. It should be readily available from your friendly FX derivatives dealer, who is probably in a better position than you to do the replication with options. I wouldn't be surprised if you can find pay-offs of this flavor in the spread betting market, but I have not tried to look there myself.

Thanks Bearish. Knowing the correct keywords really helps. The replication strategy is of theoretical interest to me, but I agree that execution is much better outsourced.