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Hello all,
Second post from a newcomer, and hope you could advise me on something Fx related, albeit not related to daytrading.
I would like to invest in AUD, CAD, SGD and GBP and was wondering what the best way is of doing so. I use a mainstream trading platform called Swissquote and am not looking to buying futures (sorry for posting the question here) but actual currency.
Perhaps for pure speculation a GBP future would be of interest, expecting a recovery of the GBP within 2 years. Are there any such longer term futures out there, if so any you could advise and why?
Thank you in advance.
SdoubleW
Can you help answer these questions from other members on NexusFi?
****
Due to the lack of response I assume this question is misplaced here. Can anyone suggest a forum where I could discuss such matters? Thank you in advance.
SWW
I think IBKR as a broker would be best for holding currencies physically list of currencies AUD, CAD, CNH/CNY, CHF, CZK, DKK, EUR, GBP, HKD, HUF, JPY, MXN, NOK, NZD, RUB, SEK, SGD or USD. except (INR and KRW)you cant convert in this 2 currencies
Just go to your bank and convert your currency. You don't need a brokerage account if you just want to hold.
Matt Z
Optimus Futures
There is a substantial risk of loss in futures trading. Past performance is not indicative of future results.
Trading futures and options involves substantial risk of loss and is not suitable for all investors. Past performance is not necessarily indicative of future results. You may lose more than your initial investment. All posts are opinions and do not claim to be facts. Please conduct your own due diligence. Use only Risk capital when trading Futures.
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What do you mean by invest in a currency? Currencies trade in pairs. You sell one currency and buy another. So if you want to invest (I assume buy) AUD you have to sell another currency to buy it. Most FX brokers will allow you to trade AUD against CAD, CHF, EUR, GBP, ILS, JPY, NOK, NZD, SEK, USD, ZAR and probably some other less prominent currencies. It should be pointed out that forward currency rates are very interest rate dependent. If you sell a high yielding currency (say South African Rand ZAR) to buy a low yielding one (say EUR) you can expect to lose 7%/year on the funding/interest spread. So you need the currency to move 7% just to breakeven.
The Liquid CME Futures (AUD/6A, GBP/6B, CAD/6C, EUR/6E, JPY/6J, MXN/6M, NZD/6N) are all USD crosses. While they do list several other crosses (mostly vs EUR) many of these have little to no volume. For example EUR:GBP /RP only traded 3000 lots today and EUR:JPY /RY barely over 1000.
There's also the ICE.US/NYBOT Dollar Index Contract which is based upon a Geometric mean of a weighted basket of USD currencies but it's heavily EUR based.
Interactive are known to have very tight bid-asks and good size. So if your going to trade they are probably a good option. Their rolls/swaps/interest rates or whatever you want to call it though are terrible. So if your holding a position, they are not as good an option.
I will only add that IB allows one to use different accounts for funding and withdrawal. So you can fund your IB account out of a CAD-denominated or USD-denominated bank account in Canada, speculate / invest, turn the ultimate capital into CHF and send it to your bank account in Switzerland.