Q & A

Frequently Asked Questions

How big is the Forex market?

The daily average traded on the Forex market is estimated to be $1.5-2 trillion in combined currencies around the world. The typical currency transactions are done by banks, brokerage houses and forex companies in amounts between $3 million and $10 million.

Why are exchange rates from forex companies different from those published in the daily newspapers?

Forex market watch services provide the forex rates to be published in the daily newspapers; however, currencies are being traded around the clock, and the published forex rates published will always be behind the current deal price.

What are the advantages to selling or buying on a specific day of the week?

There are no advantages because today’s forex market operates around the clock.

What is a Forward Contract?

With this type of transaction, you can negotiate a rate today to exchange the currency on a future date—it’s a contract to buy or sell currency on a future date at a predetermined rate. The rate on the forward exchange contract is based on the spot rate and the differential in interest rates between the two markets involved. This type of transaction helps you manage your foreign exchange risk because, by setting the exchange rate in advance, you eliminate the uncertainty related to fluctuations in the currency until the time you pay for it or receive it.

What is a spot transaction?

A spot transaction is an agreement with both parties to sell or buy currency at the current exchange rate, delivered or settled within two business days.

What countries use the Euro?

As of January 1, 1999, eleven of the European countries and the Monetary Union (EMU) decided to give up their own currencies and combine currency to the Euro. The eleven countries were:

1. Austria

2. Belgium

3. Finland

4. France

5. Germany

6. Ireland

7. Italy

8. Luxembourg

9. Netherlands

10. Portugal

11. Spain

On January 1, 2002, Greece decided to followed suit with the Euro.

Euro bank notes began circulating in the countries above, on January 1, 2002. All transactions in these countries were priced in ‘Euro’. The old currency of each country has slowly been withdrawn from circulation.

How do I detect counterfeit money?

There are five points to detecting currency that may not be legitimate:

1. Examine genuine currency for feel and look. Learn to know your money.

2. Look for differences between currency you know is genuine and fraudulent notes.

3. Serial numbers change too frequently to be reliable. Do not rely on them.

4. There are many counterfeit detector machines and detector pens available; however, they are not 100% accurate.

5. Call your local police if in doubt.

How credible is my broker?

We have safety precautions in place to help protect you and your money against various types of fraud. We have been operating since 1999 and will gladly provide client references. In addition, we follow very strict policies and procedures in regard to the control of your money and the clientele we serve.