All you need to know
What is foreign exchange?
Foreign Exchange (or Forex or FX) is the buying and selling of currencies and the settlement and payment of those funds.
Why do exchange rates change?
The simple economic factor of 'supply and demand'. The more people that want to buy a particular currency will push up its price. However there are many factors that affect the rates on a daily basis, some economic, some political and in most cases unpredictable.
Will I get similar rates to those quoted on Ceefax and on websites?
The rates that you see published are normally 'mid prices' of the 'Interbank Rate'. These rates are expressed in terms of multi million pound currency exchange trades. Our Forex Dealers will quote an exchange rate as close to this as possible, and these rates will always be closer to the interbank rates than the 'tourist exchange rates'
How should I pay for my currency?
There are various ways of making payment. The easiest method is by an online transfer from your own Bank. These electronic transfers take three working days to clear. A CHAPS payment is also an electronic transfer but they are cleared on the same day. Alternatively a cheque payment can be made for your foreign currency. However the currency cannot be transferred until incoming payment has cleared.When you are discussing your requirements with a forex dealer payment details will be discussed.
What fees will I be charged?
Fees vary between Exchange companies but normally there is a threshold limit (usually �5,000 - �10,000) that attracts a nominal fee (normally �10 -�20).
Are my funds secure?
Once an exchange trade is agreed your funds will have to be transferred into a 'Client Account'or 'Escrow' account held with the companies' bankers. This accounts have built in protection mechanisms for the client.Once cleared the currency will then be electronically transferred.
Why are your exchange rates better than those from a Bank?
Specialist foreign exchange companies buy large volumes of currency and can buy at competitive rates.Dealers are able to offer up to the second exchange rates.
How are currency values affected by interest rates?
Interest rates are a main driver in determining exchange rates. If a country has high interest rates it will attract foreign investors whom are looking for good returns on their investments.Consequently the demand for the local currency is increased, making the currency stronger.
Are you regulated?
There is no regulatory authority for the Forex Industry. However every Foreign Exchange company must be licenced by HM Customs and Excise for money laundering and have to follow stringent requirements.
Do you deal with all world currencies?
Forex dealers can trade all the major world currencies such as US dollar, EURO, CAD, JPY, GBP, ZAR, CHF, NZD and so on.Some minor currencies cannot be dealt with.
What is the smallest transaction size that I can do?
Each Foreign Exchange Company will have a limit as to the lowest transaction size that they can do. Information on request
Once a deal is done can it be stopped?
Once a Forex Dealer strikes a deal with a client they will buy the currency on behalf of the client.If the currency is no longer required the only option open is to sell the currency back at the prevailing market exchange rate.
Once an electronic currency transfer is made can it be recalled?
Once a foreign currency trade is agreed and the transfer made it cannot be recalled as once initiated it is guaranteed funds.
Is there a good time of the day or week to buy foreign currency?
No. There are so many variables that affect the exchange rate that there is no hard and fast rules as to timings of currency trades.
Which European countries use the Euro?