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Investors in Europe may be looking for more yield and that can be found in emerging-market government bonds. Then if the bonds are issued in euros instead of dollars then that is more convenient. Also the emerging-market issuer of the bond in euros pays a lower interest rate than in dollars. However, there is still an interest rate spread between the euro ...


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For UK citizen and UK forex trade account, the forex capital gains are tax-free according to this article : This means a trader can trade the forex market and be free from paying taxes; thus, forex trading is tax-free! This is incredibly positive for profitable forex traders in the U.K. The drawback to spread betting is that a trader cannot claim ...


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Let us assume that the currency-protected loan is less than 4%. Now, borrow money using this currency-protected loan and invest it into US bonds. You will have a risk-free profit! Let us now assume that the currency-protected loan is more than 4%. You do the inverse. You borrow USD money at a rate of 4%, invest it into EUR bonds at a rate of 1%, and act as ...


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Because by insuring yourself against currency fluctuations, EUR debt costs exactly as much as USD debt. If you live in US, you obtain your salary as USD. Thus, by borrowing any other currency, you should ideally insure yourself against currency fluctuations. Guess what? If EUR debt rate is 1% and USD debt rate is 4%, the cost of the insurance is 3% per ...


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It almost always makes the most sense to borrow in your home currency. The reason that there are different interest rates is because there are different inflation expectations. In this case, a lower EUR interest rate means that inflation is expected to be lower in Europe over time than the US. So let's look at it from a US homeowner's perspective. They are ...


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If you look further down the second thread you link to, it says: CFA Institute’s convention is USD/GBP 1.5253 means $1.5253 = £1.0. This is not the standard convention. Your first link does use the standard convention, which is why they seem to give contradictory results.


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It is not clear to me that you are thinking about this formula correctly. The uncovered interest rate parity formula is used to help judge if forward exchange rates fairly reflect interest rate differentials. For example, suppose we wish to look at EURUSD one month forward. We begin by looking up the spot fx rate. We would then consult the interest rate ...


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The actual exchange happens with an inter-bank exchange rate, which is what you find in the internet, but both banks can tack on their fixed or proportional fees - as well as any intermediary bank. You should read both bank's fee schedule, and do the math to optimize it for you - each bank has little interest in saving your money. Often, the bank that does ...


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The bank does and unless you have agrements with it in place you get royally screwed. Always has been like this. What we do in cases like this is: Not use the banks. TransferWise and other international transfer services give you a WAY better exchange rate and take and transfer out local currency. Chang money NOT as part of transfers. We get a foreign ...


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No, you can only trade in the currency of the exchange the security is listed on. If it is listed on a US exchange, then it is priced and traded in US dollars. If it is a European company, for example, a German company, it would have listed stock trading on European stock exchanges and would be priced, and traded in Euros. The company might also list ...


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Yes, assets on an exchange are traded in a specific currency. The same asset may be traded in different currencies on different exchanges (such as through ADRs or currency-hedged derivatives), and I suppose the same exchange could trade the same asset in multiple currencies (though I don't know of any), but you can't choose which currency you want your asset ...


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While cryptocurrency is new and unusual, there is a similar instrument which is much older more familiar: Gold. Obviously it's not exactly the same, but we can make useful analogies. How does one invest in gold? Buy and sell chunks of gold itself Trade shares of a fund (ETF) that holds gold for you Trade shares of gold producers (miners) Trade shares of ...


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