Look For the Best Deal, Save Big Money

The average person's foreign exchange transaction is in having to change their currency into that of the country they wish to visit. This they do by going to the high street travel agent, Post Office, or bank. They do not worry too much about saving on the exchange rate for the relatively small amount in question.

There comes a time when they may wish to make a much larger transaction abroad such as buying a car or a boat, but mainly a house. This of course is a different cup of tea, and it is much cheaper to use the services of foreign currency exchange companies who can arrange cheaper quotes than the high street banks, therefore making it possible to save considerable money.

It is important to keep things simple and easy to understand.                         

Take an example of a Mr Smith wanting to buy a property in France. He needs to have a sum to cover the cost of the house and a sum to cover the other payments such as agent's fees etc. He adds it all up and comes to a total amount he will need to have in the foreign currency in this case the Euro. He has to get the required Euros. He now begins to realize that the price of the house also has a cost of the currency exchange rate to consider.

More than likely he will go to his bank to see what amount of Sterling they will require from him to purchase that foreign currency and send it to the seller. It is at this point he ought to be prudent. It is a good idea to go to the bank and get a quote as to how much it would cost to buy the required Euros and to have them sent to their destination. However, Mr Smith should spend a little time checking with some of the foreign currency exchange companies and get a quote from them too! Mr. Smith may find that he could save himself a nice few thousand because the rates that he could get will be undoubtedly cheaper than those from the high street bank. In short, a buyer like Mr. Smith might find the best way to proceed as follows:

1.  Open a bank account in the country and place where he is buying the house. This is quite easy and the local estate agent will be pleased to introduce him to a bank.

2.  Try to find the best currency exchange rate from the many companies that deal in foreign exchange. After finding the best deal, have the currency sent directly to his account at the bank abroad.

It is worth a few phone calls to very likely save big money. Currency rates change all the time and you have to bear that in mind, so the question is what is the percentage you would be charged above the live rates.

Live rates are easy to find free on the internet. You cannot get access to buy at these rates and there will always be a difference between the live rates and the rates you will get quoted. However, the degree of this difference is what you are after. It pays to check to find a good deal. To be fair you have to say what amount you are requiring to change because this may make a difference to the rate you will get. Obviously, if you are talking about ten thousand as opposed to hundreds of thousands this will count.

Money is sent by electronic transfer and banks charge for this usually between 25 and 35 pounds when sending money abroad bank to bank. The foreign currency exchange companies do not usually make a charge because they already calculate it within the rate of exchange in their quote, which is very fair since they will invariably give a better quote for currency rates than the high street bank who will charge the transmission cost as well!

Foreign currency exchange companies know that they are cheaper than the high street banks. Can you imagine that they could exist if they were not cheaper? Apart from that they are more focused on this type of business because they are specialists in this field.

When you go to a restaurant it is the chef that matters. When you go to a hairdresser it is the cutter that matters. When you go to a garage it is the mechanic that matters. With the foreign currency exchange companies you have personal attention to your particular needs by a specialist. Above all, you can save money.

Paul Dubsky
Currency Exchange | Foreign Exchange | Currency Exchange Rates | Currency Exchange Services.

Knowing Some Basics Concerning the Foreign Exchange Market


We come face to face with our local money every day. The time will come when some of us will need to make or receive a payment in a foreign currency.


To jump this hurdle, we go to the bank to handle the currency exchange, or to a number of foreign currency exchange companies we can find on the internet, who will invariably quote far better rates of exchange. Believe me they will, they could not exist if they did not offer a better deal.


You do not have to be a mechanic to know some essential words about a car like the steering wheel, the hand brake, clutch pedal, the engine etc. But you do need to know these fundamental words to be able to understand what they refer to when becoming a car driver otherwise life would be hard.


Similarly, it is important to know a little about the foreign exchange market so that when the day comes and you will be need to buy foreign currency to get that house of your dreams or anything else abroad, you are not at a disadvantage.


The FOREIGN EXCHANGE MARKET also called FOREX or FX, has no trading centre.


Unlike the London Stock Exchange or the New York Stock Exchange centres, it has no fixed abode, but manages very well and is extremely active.


There are hundreds of brokerage companies and banks, who deal between themselves including big corporations. Put these on one level. On another level, there are smaller agents who handle the buying and selling of the foreign currencies, going by the rates as signalled by Reuters or other agencies. These rates are aligned to the actual events taking place non stop in the market.


The difference between these two levels is a wholesale and retail classification as existing in other trades. When the media talk about the foreign exchange market, it is the wholesale level they refer to.


Foreign exchange currency institutions have better access to obtaining a more advantageous rate of exchange than the ordinary small company or the man in the street.


The foreign exchange market operates 24 hours per day.


BID is the rate at which a dealer is ready to purchase the base currency.


OFFER is the rate at which the dealer is ready to sell the basic currency.


The difference between the BID and ASK price is called the SPREAD.


The MARKET MAKERS make the profit from the spread. They make no commission.


BASIC CURRENCY is the currency against which the other currencies are quoted.


BULL MARKET refers to a price rising market.


BEAR MARKET refers to a declining price market.


BOTTOM: a description of a price decline meeting heavy support against further price decline.


CABLE: When the steel cable was connected under the Atlantic in 1850 thus linking USA with UK enabling telegraph transmission between the London and New York Exchanges, it was called ATLANTIC CABLE. Satellite and optic cables are now used, and the word CABLE refers to GBP/USD currency pair rate.


CROSS RATES: This refers to currency pairs where the USD is not included like GBP/EUR or GBP/JPY


MARGIN refers to a deposit in cash required to cover the possibility of loss the client may encounter trading the foreign exchange.


MARGIN CALL refers to a requirement for additional money, to make up the minimum cash deposit needed to cover any losses the client may encounter trading in the foreign exchange market.


VOLATILITY refers to the extent of price fluctuation.


There are of course, many more terms used in the foreign currency business, but you have here a selection which will help you to know some of the basics.


Good luck.

Paul Dubsky

Currency Exchange | Foreign Exchange | Currency Exchange Rates | Currency Exchange Services.


More Words and their Meaning Relevant to the Foreign Exchange Scene

There are many instances when we hear or read numerous words and phrases, but are rather uncertain of their exact meaning. The foreign exchange is only one part of the financial world of many sections, each of which seems to have its own expressions and jargon, as if it was all designed only for those with professional or specialised knowledge of the subject.


Of course, other trades have their own language, like the legal boys for instance.

It is not too difficult to get to know what it all means, and if one can learn some of the important words and expressions, it makes life that much easier.


Here are a few expressions you will run into, the answers to which you may find useful:


World Bank: The bank consists of IMF members, and helps by making loans to member countries, particularly when money from the private sector is not offered.


Bank Rate: This refers to the rate at which a central bank will lend to its domestic banks.


Basis Point: One per cent of one per cent


Cable: The foreign exchange market reference for the USD/ GBP


Consumer Confidence: This is an indicator of economic conditions run by the Conference Board. All over the country, some 5000 consumers are surveyed monthly, the degree of confidence being associated with the volume of consumer spending.


Covered Call: The Foreign Exchange Market uses this name for the rate USD/GBP


Cross Rate: This is a rate between two currencies of which neither is the USD


CHIPS: Clearing House Interbank Payments System.


Disposable Income: Money earned after tax.


Eurodollars: USD on deposit in a bank outside of USA.


LIBOR: London Interbank Offered Rate.


Liquid Assets: These are various assets which can be quickly converted into cash.


Easing: A price decline.


Economic Indicator: Data indicating economic growth, taking into account for example, retail sales, employment, rates, etc.


Liquidity: The competence of a market to undertake sizable transactions.

Resistance Level: A summit of a price level at which point the supply is greater than the demand.


Bull Market: A period of time when prices are seen to be rising.


Bear Market: A period of time when prices are seen to be falling.


Market Rate: Is the up- to- date quote of a currency pair.


Pip: refers to the 4th decimal point i.e.0.0001 of any foreign currency.


Fill Price: This is the price at which the order for buy or sell was executed.


Households Survey: The number of people that are employed, the labour force in general, and the rate of unemployment.



Paul Dubsky
Currency Exchange | Foreign Exchange | Currency Exchange Rates | Currency Exchange Services.

Knowing Some Words Used in Electronic Money Transfers


Electronic money transfers are not only used in connection with foreign currency exchange payments, but in a host of other payments especially when larger amounts are involved such as property, cars, boats, in fact anything.


Nowadays, EUROPEAN CROSS BORDER PAYMENTS are made easier for the parties to send, thanks to the use of IBAN which means International Bank Account Number for short.


IBAN is a bank code which identifies the account number and additional characters,

thus avoiding possible mistakes.


It must be noted however, that its validation is no guarantee that the account number or bank code is correct or that it exists.


It is the responsibility of the account owner to notify their IBAN to the party they wish to deal with.


The IBAN is given for the account by the bank serving that account, and should only be taken from that bank. It prevents getting possible incorrect IBAN details, as this can cause delay in receiving payment. Nobody wants any delays when making foreign currency exchange payments.


Companies dealing with international money transfers are very exact and are eager to change one currency against the other as fast as they possibly can, to complete the deal and show their clients how smoothly and quickly they perform.


The bank identification code BIC is another abbreviation, which you will come across.


BIC is a way of being able to identify financial institutions so that the process of telecommunication in financial institutions/banks is facilitated.


In order to make a payment, it is required to quote the IBAN and BIC. The use of IBAN became compulsory since July 2003.


Most people have heard of the abbreviation SWIFT, which stands for Society for Worldwide Interbank Financial Telecommunication


SWIFT is a global provider of secure financial messaging service. It is this service that foreign currency exchange companies use to move the money bank to bank. It is also the same service constantly used to move millions of pounds and other currencies   by countless other financial institutions. It is fast and safe.


When making foreign currency transfers you will simply need to fill in a form, which the company you select to do the business with will provide. The few above mentioned details, serve only to inform those, who wish to know what certain abbreviations actually stand for, plus a little explanation here and there.


Paul Dubsky

Currency Exchange | Foreign Exchange | Currency Exchange Rates | Currency Exchange Services.

Some Words and Some Knowledge Regarding the Foreign Exchange Market

Whether you call it Forex or Fx, you are talking about the Foreign Exchange market. This is where the trading of currencies, one against the other, is done. To have an idea just how big the action is, add all the stock exchanges in the world together and the Foreign Exchange will still be bigger!


When you consider that various speculators, hedge funds, governments as well as companies, plus countless private investors who take part, it is hardly surprising that this market is so strong and that the estimated daily average turnover of the foreign exchange market is over 3 trillion US Dollars.


By far the most asked for rate is the SPOT RATE. This transaction has to be settled within two business days.


With London, New York, Tokyo, Frankfurt and Sydney as the chief trading centres, the action hardly ever closes.


When you are at an auction and you put your hand up, it means you are bidding for something at a certain price. In a similar way, the word BID refers to the price at which the buyer is prepared to buy the currency.


The OFFER means the price at which an amount of currency the seller is ready to sell.


A LIMIT ORDER is when you give instructions the buy or sell a currency at a predetermined exchange rate.


When international banks buy and sell between themselves, the bid and exchange rates are called INTER- BANK RATES.


The difference between the bid and ask price of a currency is the SPREAD.


STOP LOSS is when an order is given to purchase or sell a currency at a price level set by the client on a particular trade which if reached, will close out the particular position at the stated price.


TRANSACTION DATE is the date on which a foreign exchange trade is being done.


The date which foreign exchange contracts settle is called the SETTLEMENT DATE.


Every currency has a three letter code such as for the Euro (EUR), for the British Pound (GBP), for the US Dollar (USD), for the Japanese Yen (JPY), for the Australian Dollar (AUD), for the Swiss Franc (CHF), for the Canadian Dollar (CAD). Actually, these are the major trading currencies and all commonly traded currencies are called the MAJORS.


CABLE is a name given to the US Dollar/British Pound rate in the foreign exchange market.


EFT is the Electronic Fund Transfer which is the transfer of money between banks.


When there is a quote in currency pairs, remember that the first currency is called the BASE currency. The second currency is called the COUNTER currency. As an example when you get a quote GBP/USD at 1.96 it means that for one GBP you will get 1.96 USD. So for ten thousand pounds you will get nineteen thousand six hundred US Dollars.


The many foreign currency exchange companies which you can find on the internet will gladly give you a quote, and by phoning around you can find the best currency rates. They will be better than a high street bank is likely to offer and they will give you a very fast service. Furthermore, most of them will not charge you any commission or the cost of the electronic bank transfer.



Paul Dubsky
Currency Exchange | Foreign Exchange | Currency Exchange Rates | Currency Exchange Services.

Forming an Opinion Which Way Your Chosen Currency Might Go

It is known that currencies react to a series of events such as inflation, interest rates, the state of the economy, and so forth. Because of this, it is vital to keep evaluating the various data, in order to form an opinion of the direction the currency of your choice might be heading.


Let us look at inflation and what it actually means. It is not about a particular model of a boat or a motorcycle, or certain services costing more money, which could be due to business enterprise success or failure, but about a widespread increase in prices throughout the country.


The rate of the inflation is based on a calculation of the average price change right across the economy. This is usually taken over a period of a year, hence the term annual inflation.


If there is an annual inflation rate for a particular month, say March this year of two per cent, it would mean that the prices in general were 2 per cent higher this March, than in the same month last year. Therefore, a blend of usually purchased items costing GBP100 last March, would be costing GBP102 this March.


To get the right reading, prices are taken all over the country in many sectors like the supermarkets, big stores, travel and insurance firms, etc.


There are other issues which set the level of inflation in the economy, but the fundamental causes of inflation have to do with the extent of demand in the economy, and can be narrowed down to how much cash can be spent in relation to what can be produced.


When demand shoots up above what can normally be produced in normal circumstances, this upward pressure creates a rise in costs and prices. When the demand is down, this creates a downward pressure in costs and prices. To keep inflation controlled, it is required to keep a balance between the demand and output situation. When you have an excessive demand to the supply position, you have a formula to generate an inflation climate. This is the reason for stability as a goal.


Lowering interest rates may well see a rise in output, but only for a limited period. If both demand and output have been strongly increased and then suddenly fall, it is called boom and bust.


It is also useful to keep an eye on the extent of the employment and unemployment figures. These can indicate the size of the economic movement as well as the weight of labour demand, increases of wages, and of prices.


Do not forget to take notice of the (CPI) Consumer Price Index which is an important measure of inflation.


Watch also the balance of trade situation. A trade surplus is a positive balance of trade, namely the exports are bigger than the imports, whereas a trade deficit is a negative balance of trade with imports being larger than exports.


There are a number of other points that can be looked into of course, but the main ones are important to keep in mind at all times.


A number of people follow the charts, and keep an eye on what the position was year after year.


There is no known magic formula as such, to positively determine the direction of any currency pair, but being informed as much as possible, goes a long way to narrow the odds against you.


Paul Dubsky

Currency Exchange | Foreign Exchange | Currency Exchange Rates | Currency Exchange Services.


Duck and Dive but Not with Borrowed Money


For a currency deal you need a buyer and a seller. As soon as they do a trade, there will be a winner and a loser.


Let us take a Mr. Brown and a Mr Smith both residing in the U.K. thus their home currency being Sterling. They have enough cash funds on deposit with which they wish to trade. They will not need the money urgently, and can afford to wait for a substantial time should they be unlucky enough to hold a currency that might begin to depreciate.

Both are ducking and diving, happy to work on a small profit.


So, let us assume Mr. Brown bought dollars. To start with, the dollar appreciated against the euro and so he sold his dollars. Mr. Brown made a profit, probably a small one, but nevertheless a profit. He cashed in the profit he made, and he placed the balance of euros now held, on deposit to earn him interest.


On the other hand, Mr. Smith who bought euros is making a loss. However, at this stage he is only making a loss on paper, because he has not sold his euros as yet. He decides to hold on to the euros hoping they will appreciate, and waits. As it happens, the euro gains in value, and actually Mr Smith is now ahead. He waits a little longer to see if the euro will appreciate further, and there is another move up. This makes Mr. Smith decide to take a profit and he sells his euros. He cashes in his profit and the balance of the dollars he is holding, is placed on deposit to earn him interest.


But the currency market never sleeps and money values fluctuate all the time. Thus, from minute one of depositing their money, either Mr. Brown or Mr. Smith will see their euros or dollars in constant action, destined to go up or down in value. Again one of them will see his currency go up or down.


Because their home currency is GBP into which they eventually want to return, they are also watching the position of Sterling in relation to the two currencies they are holding.


Mr. Smith, who is in dollars, notices that Sterling is suddenly taking a heavy fall. He is now interested for Sterling go down more and more, because he can see his way out of trouble by  changing his depreciated dollars into a possibly even more depreciating Sterling. Of course, if his dollar should appreciate and the Sterling slip further, he would sing all the way to the bank that much quicker.


It can be seen that it was not just a race between the dollar and the euro, but that due to a big wave, a third currency came suddenly into play throwing a lifeline to Mr. Smith.


Unexpected events are detrimental to some, but beneficial to others.

Often, taking little profits, it is thus possible to duck and dive especially if one is clever enough to notice when these small waves tend to occur, and therefore accumulate some nice money.


Of course abnormal conditions can arrive, as we have seen lately. All of a sudden it is not little waves, but huge waves that come. One extra large unexpected wave can do the damage. It is then, that the gain or loss to Mr. Brown or Mr. Smith can be heavy, wiping out swiftly any profits which one or the other might have accumulated over a lengthy period of ducking and diving. Naturally the lucky man holding the right currency is extremely pleased at that point.


Since it can take a longish time for the loser to get out of trouble before the cycle turns, he has to be prepared for it. For this reason, it is vital not to make investments of this kind with borrowed money, but only with money one can spare. To recoup in due course, one must be patient ad not be upset I having to wait.


When conditions are very volatile, it is dangerous but can be profitable. Not everybody dares to enter that arena. At the moment, the gentle opportunities of rocking up and down are hard to find, but not impossible, a lot depending on which currency one is holding.  


In the currency game anything can happen, and it does.


It is strange, but when you desperately need to win, it will seldom happen. The time one wins, is when one is not desperate to win.


If you keep your head you can have plenty going for you in the foreign currency trading. The key is to play with your own money and not with borrowed money because you cannot be sure what will happen and when. There are chances of getting out of trouble when things go wrong if you have the time to wait. Sometimes a big wave can slow you down or help you, but if you are ready for the worst, the odds are you will survive and make money.


Impatient willy-nilly investors in this game do not last long. Patient ones can get out of trouble if under pressure, and fight on with good chances to do well in the long run.


Paul Dubsky

Currency Exchange | Foreign Exchange | Currency Exchange Rates | Currency Exchange Services.

On Wanting To Dabble In the Forex Game

Mr. Smith is interested in possibly looking into buying and selling foreign currencies as a sideline. To start with, he just wants to try things out in a small way on paper to see if he could make a profit before really playing for money.

Mr. Smith does not relish the thought of studying all types of forex jargon and complicated expressions. Consequently, he has to know at least something to get him started. Here are some words which people like Mr Smith may wish to be conversant with.

When looking at a forex quote, there are always two currencies involved. These are the BASE currency and the QUOTE currency. When looking at a forex quote of say CAD/USD, the second currency is base currency. Therefore in this case, the Canadian Dollar would be worth (depending on the rate), X American Dollars.

The BID price is the price when you are buying (going LONG)a currency pair, and the ASK price when you are selling  a currency pair (going SHORT). The difference between the bidding price and the asking price is called the SPREAD.

Often you hear the mention of the Non Farm Payroll Report. This is a report by the Bureau of Labour Statistics in which can be found the position of monthly gained or lost jobs in the USA, but excluding the farm jobs. Furthermore, it gives the unemployment percentage rate position as well as the average hourly earnings. Employment changes are included.

The initial sum of money invested is called the PRINCIPAL VALUE.  In case you are not sure what GDP stands for, it is The Gross Domestic Product and it refers to the extent of the income of the nation and its production and manufacturing within its borders.

 The middleman acting between the retail trade and the commercial institutions is called the BROKER and the fee he charges his clients for dealing for them is called COMMISSION.

Often you hear the word CABLE. It is used when referring to the GBP/USD currency pair. It goes back to the days in the 1800s when the dollar/pound sterling exchange rate was done by using a transatlantic cable.

Resistance and Support are often mentioned. Take two lines, one at the top of the other. At the top line the resistance and the bottom line the support. If the price goes over the top line level then that level is automatically the new support level. Naturally if the price goes beyond the support level, then the opposite is the case.

A BULL market denotes an increase in price and a BEAR market is the opposite. This expression is being used constantly and is really quite easy to understand for almost everyone who speaks fluent English.

 Although frequently mentioned, there are a number of people who do not completely know the meaning of BANK RATE. It is the rate which the Central Bank of the country will lend money to the domestic banks there. Another expression is the RALLY and this refers to the time when prices climb higher.

SWIFT is the short for Society for Worldwide International Telecommunication and is used for sending money from one country to another, the money is being sent within the United Kingdom then it is usually sent via CHAPS which stands for Clearing House Automated System.

Good luck to those who will be like Mr Smith and dabble a little in the Forex game, but later when and if they get a taste for it, they must study in earnest and learn a whole lot more of course.

Paul Dubsky 
Currency Exchange | Foreign Exchange | Currency Exchange Rates | Currency Exchange Services.


 Bookmark and Share  Foreign Currency Exchange & Transfers Ltd. 

6 Tristram Way, Whitfield, Kent CT16 2GL 
Telephone and Fax: 01304 828842 
E-mail: info@foreigncurrencyexchangeservices.co.uk  

Registered in  England  & Wales No. 6334022  Registered Office: 6 Tristram Way, Whitfield, Kent CT16 2GL

© Copyright Foreign Currency Exchange & Transfers Ltd. - All rights reserved.
Powered by:
Foreign Currency Exchange & Transfers Ltd.

Currency Exchange | Foreign Exchange | Currency Exchange Rates | Currency Exchange Services | Foreign Currency | Buy Foreign Currency | Foreign Currency UK | Foreign Currency Exchange |

  Site Map