exchange rates

edited 30 November -1 at 1:00AM in Budgeting & Bank Accounts
66 replies 18.6K views
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  • SystemSystem Forumite
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    Diggin' Hi -

    There is a very simple way of looking at it - Risk versus Reward - if you want to enjoy complete safety of your funds and ensure that the company you are dealing with will not run off with your money or (most likely) go under overnight then go with your bank and get a poor rate and very poor service. If you want the best possible rate then go with someone who can offer that - but be aware that they may not always be the most scrupulous and that there is an inherent risk in doing business with them! If they are offering the best rate in the market you also have to wonder how they make their money - there is a cost to running a company and if they trim their margins too much then something has to give.....

    Part of the problem is that this is an unregulated market with (relatively) low start-up costs. Any johnny with a bit of experience of the currency market can set up a company and promise the earth to get a deal - but if they do not have the financial backing to support them they are VERY vulnerable.

    Telling good versus bad is very hard but by and large go for one of the bigger ones - HIFX, Moneycorp, Caxton, Currencies4less - they all give very similar rates with a similar (good) level of service compared to the banks. Yes, I know the market but come to the forum as an independant bystander.
  • DiggingOutDiggingOut Forumite
    770 Posts
    You didn't include ISX....
    I have five stars! This doesn't mean that I know anything about any of the things I post. I could be a raving lunatic, or a brilliant genius, or just some guy on the internet. In fact, I could be all three at the same time.

    If anything I say makes sense, then do it. If not, don't. Don't blame me or my stars if you do something stupid because I suggested it. I'm responsible for my own stupidity only. You are responsible for yours.

    Why, I don't even have five stars anymore! Aren't you glad you aren't responsible for my stupidity?
  • SystemSystem Forumite
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    I have used ISX and have to say there service is good, they taklked me through the process and explained everthing very well.

    I used my bank initially and was told it would cost me £35 to tranfer the money, so I looked for an alternative.

    I don't know much abount this but am happy with the service.
  • SystemSystem Forumite
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    ISX was incorporated in January of this year - The parent company, ISX Markets, under a year ago. I'm not sure I would consider them one of the biggest, no.

    Interestingly, on their website they claim the company has dealt with over half of the FTSE 350 companies - quite a feat for a small company set up less than a year ago that no one in the currency markets has heard of!
  • Robin00Robin00 Forumite
    56 Posts
    Haven't been on here for a while and seems there are some issues to answer!

    1. Transfers to/from the US virtually always go via a "Corresponding" bank who will tend to charge $10-$30 to route the money. Outgoing transfers will still usually arrive at the destination same day, but incoming could take longer, so it's best to get your funds back to the UK (either a US$ account held here or a broker's client account) before changing back to sterling. And don't even think about a US$ cheque or draft because it will take about 6 weeks to clear if you present it in the UK.

    2. The comments about start-ups are very true - check that you're not just entrusting 2 guys in their bedrooms with your life savings! The industry is not FSA regulated but if you ensure your broker is (a) registered with Customs & Excise and/or (b) a PLC then you should be fine.

    PLCs include ourselves and HiFX amongst others. They must be more accountable and have larger share capitals to gain this status than normal Limited Companies.

    You can also check when the company was incorporated and ascertain their yearly turnover (should be well over £100m) to know that they are serious players.

    All transactions carry risks - if you had funds with BCCI or Mr Maxwell a few years ago you'd not have thought you were at risk either. In fact the brokers should be better at getting your money to the right place quickly than the banks, because they specialise wheras the banks won't spot mistakes (eg what happens if you fill in a Swift code incorrectly in your bank - will the cashier notice?) - payments through brokers are handled by people with specific experience in making transfers around the world.

    Also, your broker won't usually hold cleared funds of yours for more than 24hrs before making a transfer - so the risks really are minimal. Just make sure you use a good one!!
    No Unapproved or Personal links in signatures please - FT3
  • SystemSystem Forumite
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    This is not for personal gain, nor is it a commercial offer, but it just so happens that I have a large amount in Euros which I got "stuck in" and which I want to convert back to GBP. As a result if anyone is interested I could agree a better rate than any bank or broker (with no commission) just to get rid of them. I will be making a loss! It all depends just how many you want, but it is a large amount.
  • SystemSystem Forumite
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    does anyone know where i can get a decent exchange rate on my dollar travellers cheques.got about a grands worth.i told the wife we will have to go back arff arff :-/
  • Has anyone had any experience using XETrade.com for currency exchange and how do they compare to similar UK currency exchange sites?

    I want to convert sterling to 10,000 euro and want to find the best rate.

    Thanks.
  • This is probably a bit late for me now, as I've done my GBP to EUR transfer (incidentally, the best rate I found was ISXFX, who are down to .3% off the interbank rate).

    However I notice that the spreads on currency trader accounts are VERY low, compared to currency brokers. I saw a spread of .0003 of a pound on one advert (compared to .0090 for ISXFX) - quite a saving! Is it feasible to set yourself up as a trader and just buy the euros (or whatever) that you want and stop trading? I saw an American site that only allowed you to put in or take out US$ so it wouldn't be practical at that site.

    Anyone with experience of currency trading?
    Titch :)
  • Tarding Accounts are for margin trading, you will not get the currency delivered, but just the P&L will be credited or debited from your account.

    I have just had a look at ISXFX and they seem to be very competitive (as far as commercial FX is concerned). These are the rates they quote on there website:

    upto 5k 0.7%
    5 - 25 0.45%
    25 - 50 0.30%
    50 - 125 0.25%
    125 - 175 0.20%
    175 - 250 0.15%
    250 + 0.10%
    Titch :)
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