Exchange Foreign Money at the Best Platform – Forex

23 October 2011

Introduction to Forex :-
Forex is an abbreviation of foreign exchange. It is a market where currencies are being exchanged. In corporate language exchanging currencies is called currency trading or Forex trading. And the people exchanging currencies are called traders. Forex is like a gateway to success if your luck and work pays. Foreign currency exchange is the biggest market of this world with highest trading volume and leverages. There are number of brokers trading regularly in Forex. To start trading in Forex, one can contact the Forex broker or reputed Forex firm. Majority of members in Forex use it as a investment vehicle but you can also come across Forex when you are in need to exchange foreign money.

Why I need to exchange foreign money :-
There are many reasons when you unknowingly use Forex to exchange foreign money like your son, daughter or any family member is staying abroad and you want to send money to him/her, you want to purchase property or asset from foreign country, you are making overseas business and having your offices abroad, you need to pay your overseas staff, you want to travel foreign nation, you want to make investment and earn profits, etc. In current time, visiting foreign country or purchasing goods and services from overseas company is not surprising.

Why I should choose Forex to exchange foreign money :-
when you perform foreign currency exchange, the key factor which decides the overall expense of your foreign transaction is exchange rate. Let’s see an example to understand the effect of exchange rate on our international payment: Say you are residing in US and want to purchase some auto-parts from the UK based company. Now, if the company is ready to sell the parts in say 1,00,000 GBP then you can’t pay them in 1,00,000 USD. You need to know the exchange rate first and then it will decide how much you have to pay. If the exchange rate of USD/GBP=0.6 then you have to make payment of 1,66,666.667 to pay 1,00,000 GBP. Here 1 unit of US dollar is equal to 0.6 of pound.

In earlier days, traders were not having options for exchanging currencies but today there are thousands of company available which are directly dealing with Forex and can offer you the most competitive rates. Banks and airport authority provide the worst rate and buying money from them can make you count big losses.

In above example if the bank is offering you the rate of 0.5 then you have to pay 2,00,000 US dollars to make 1,00,000 GBP. You can see the difference of 34,000 USD. To get the best rate, you need to contact the reputed Forex company or broker and discuss the time and amount you want to make transaction of. You can use the great resources of internet and find out the spot rate (current rate) of the currencies you are going to exchange. Internet can lead you to many sites which are supported with the currency exchange calculator where you can select the “To” and “From” currency and the real time rate would be taken automatically. If you’re making investment then take help of the professionals trading in Forex, read financial news daily and keep eye on market.


About the Author

Maria walker is specialist in foreign currency exchange. He has described the reasons to exchange foreign money via Forex dealers.

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