More Words and their Meaning Relevant to the Foreign Exchange Scene

There are many instances when we hear or read numerous words and phrases, but are rather uncertain of their exact meaning. The foreign exchange is only one part of the financial world of many sections, each of which seems to have its own expressions and jargon, as if it was all designed only for those with professional or specialised knowledge of the subject.

Of course, other trades have their own language, like the legal boys for instance.
It is not too difficult to get to know what it all means, and if one can learn some of the important words and expressions, it makes life that much easier.

Here are a few expressions you will run into, the answers to which you may find useful:

World Bank: The bank consists of IMF members, and helps by making loans to member countries, particularly when money from the private sector is not offered.

Bank Rate: This refers to the rate at which a central bank will lend to its domestic banks.

Basis Point: One per cent of one per cent

Cable: The foreign exchange market reference for the USD/ GBP

Consumer Confidence: This is an indicator of economic conditions run by the Conference Board. All over the country, some 5000 consumers are surveyed monthly, the degree of confidence being associated with the volume of consumer spending.

Covered Call: The Foreign Exchange Market uses this name for the rate USD/GBP

Cross Rate: This is a rate between two currencies of which neither is the USD

CHIPS: Clearing House Interbank Payments System.

Disposable Income: Money earned after tax.

Eurodollars: USD on deposit in a bank outside of USA.

LIBOR: London Interbank Offered Rate.

Liquid Assets: These are various assets which can be quickly converted into cash.

Easing: A price decline.

Economic Indicator: Data indicating economic growth, taking into account for example, retail sales, employment, rates, etc.

Liquidity: The competence of a market to undertake sizable transactions.
Resistance Level: A summit of a price level at which point the supply is greater than the demand.

Bull Market: A period of time when prices are seen to be rising.

Bear Market: A period of time when prices are seen to be falling.

Market Rate: Is the up- to- date quote of a currency pair.

Pip: refers to the 4th decimal point i.e.0.0001 of any foreign currency.

Fill Price: This is the price at which the order for buy or sell was executed.

Households Survey: The number of people that are employed, the labour force in general, and the rate of unemployment.


Paul Dubsky

Paul Dubsky is director of Foreign Currency Exchange Services Ltd. The company is focused on being able to offer really friendly currency exchange rates. We believe we are the only Foreign Currency Exchange company which offers special rates to Senior Citizens.

The foreign exchange world has certain expressions and words of its own. It is useful to know what they mean and some are explained for you to make life easier.

On Making Risk Less Risky

Bearing in mind, that risk itself is similar to taking a journey towards a target you are not sure to reach safely, it is fair to assume that the less knowledge we have about a particular thing we wish to engage in, the greater the uncertainty we will face.

To get the odds in our favour to reach our goal successfully, we need to study the following four points first.

1.What could be a possible cause of derailment of our proposed investment.
2.What are the things that could stand in the way of reaching a successful outcome.
3.What are the valid arguments for, and against, the probability of success or failure.
4.What is the extent of our awareness of the risk we are taking, or are we making a decision under partial ignorance.

Applying these tests before making a decision is important. Since it not easy to know the answers to all the questions, many people do not bother and tend to be guided by their intuition.

To play the forex market by intuition, to back horses by intuition, to play in casinos by intuition, all this of course, is a formula for disaster.

If the more information we have about what we need to know provides a greater chance of success, then we must make it our business to get it. Knowledge and
information, are the odds you need in your favour. Whatever the investment, it is not prudent to make a decision under ignorance. If you cannot accumulate enough information about the investment you want to make, stay away from that deal and wait for another.

Of course, there are different types of investments, and therefore information and knowledge has to be pertinent to the particular investment.

If we are talking about horses racing, we would need to know about the state of the going, meaning does the horse like soft ground, or hard ground, does it run better on a left hand turn track or a right hand turn track, what distance is it best at, what draw has it got, who is the jockey, what opposition is it running against etc.

When we are talking about a football game, there are equally a series of questions that have to be answered. Are all the star players in the team, are they playing at home,
against whom are they playing, and so forth.

Playing the markets is a game based on a great deal of skill, but sometimes there are certain conditions which demand extreme caution, because any amount of skill can be derailed by events not always available for consideration in good time.

Currency markets are vulnerable to a large number of factors which must be taken into account, especially when volatile conditions are present.

One can either study the particular field, or be guided by experts and consultants who like some doctors, can be good, or extra good, but it is still better to take their advice than to do it alone. Of course if you only have a small cold, there is probably no need for a doctor. In the case of a major illness, you turn to the doctor. By the same ruling, if you invest very small money, you tend to use your own brains, but when playing in hundreds of thousands, it is prudent to seek the best help one can get, or certainly gather a great deal of knowledge and information before making a move.

By careful process in gathering as many odds in your favour before firing, you will find that things will turn out more profitable, and certainly less risky.

Precaution is an enemy of risk. Everybody knows that it is wise to take precaution, but not all take it. The few that do all they can, are wealthier and healthier, than the many who tend not to bother.


Paul Dubsky
Paul Dubsky is director of Foreign Currency Exchange Services Ltd. The company is focused on being able to offer really friendly currency exchange rates. We believe we are the only Foreign Currency Exchange company which offers special rates to Senior Citizens.

Some Knowledge On Having a Bank Account in France

If you have a bank account in France, it may be advisable to note the following:

Never issue a cheque without sufficient provision in the bank to meet it. If the cheque is not met, the matter will be reported and the Banque de France can impose a ban called Interdit Bancaire. This means that for 5 years you would not be allowed to issue cheques.

Do not write open date or post dated cheques.
When paying by card in France you are using the ( CB ) Carte Bleu payment.

The savings account = compte d' epargne.
The long term savings account = compte d' epargne logement.
The tax exempt savings account = codevi
The current account = compte courante
An overdraft = decouvert
The clearance of a cheque = encaissment
The ATM machine = distributeur or guishet automatique
The balance = solde
The statement of account = releve de compte
The permission to debit your account the provider is asking = titre inter bancaire de payment ( TIP )
Interest rate = taux
Account holder = titulaire
Transfer of funds to some other account = virement
Detailed particulars of your account and bank = releve d'identite bancaire ( RIB )
Direct debit = prelevement automatique

If you are repaying a mortgage in France, make sure that you keep up the payments
in time. This applies also to any other loans you might have, because to get black listed does not take too long.

Mostly, foreigners who open a bank account in France are those who wish to buy a property there. It is imperative to have an account because there are so many things to be paid when one owns a house. Water, gas, electricity, not to mention other payments before one even moves in.

For instance, you must pay the French notary who deals with the matter of exchange of contracts as well as all the searches regarding the property. One must bear in mind that he does not work for the buyer or the seller, but works for the State. Never be late in paying him.

Still talking about money, it might be worth your while to give serious time to understand the French inheritance law. There is a big difference regarding this subject compared to other areas of the world, and before doing anything else, make sure you really study the situation.

Here is a list of some of the big banks in France: Le Credit Agricole, Banque, Populaire, BNP Paribas, Caisse d' Epargue, Credit Mutuel, Societe Generale, HSBC, Barclays.


Paul Dubsky

Paul Dubsky is director of Foreign Currency Exchange Services Ltd. The company is focused on being able to offer really friendly currency exchange rates. We believe we are the only Foreign Currency Exchange company which offers special rates to Senior Citizens.

Duck and Dive but Not with Borrowed Money

For a currency deal you need a buyer and a seller. As soon as they do a trade, there will be a winner and a loser.

Let us take a Mr. Brown and a Mr Smith both residing in the U.K. thus their home currency being Sterling. They have enough cash funds on deposit with which they wish to trade. They will not need the money urgently, and can afford to wait for a substantial time should they be unlucky enough to hold a currency that might begin to depreciate.
Both are ducking and diving, happy to work on a small profit.

So, let us assume Mr. Brown bought dollars. To start with, the dollar appreciated against the euro and so he sold his dollars. Mr. Brown made a profit, probably a small one, but nevertheless a profit. He cashed in the profit he made, and he placed the balance of euros now held, on deposit to earn him interest.

On the other hand, Mr. Smith who bought euros is making a loss. However, at this stage he is only making a loss on paper, because he has not sold his euros as yet. He decides to hold on to the euros hoping they will appreciate, and waits. As it happens, the euro gains in value, and actually Mr Smith is now ahead. He waits a little longer to see if the euro will appreciate further, and there is another move up. This makes Mr. Smith decide to take a profit and he sells his euros. He cashes in his profit and the balance of the dollars he is holding, is placed on deposit to earn him interest.

But the currency market never sleeps and money values fluctuate all the time. Thus, from minute one of depositing their money, either Mr. Brown or Mr. Smith will see their euros or dollars in constant action, destined to go up or down in value. Again one of them will see his currency go up or down.

Because their home currency is GBP into which they eventually want to return, they are also watching the position of Sterling in relation to the two currencies they are holding.

Mr. Smith, who is in dollars, notices that Sterling is suddenly taking a heavy fall. He is now interested for Sterling go down more and more, because he can see his way out of trouble by changing his depreciated dollars into a possibly even more depreciating Sterling. Of course, if his dollar should appreciate and the Sterling slip further, he would sing all the way to the bank that much quicker.

It can be seen that it was not just a race between the dollar and the euro, but that due to a big wave, a third currency came suddenly into play throwing a lifeline to Mr. Smith.

Unexpected events are detrimental to some, but beneficial to others.
Often, taking little profits, it is thus possible to duck and dive especially if one is clever enough to notice when these small waves tend to occur, and therefore accumulate some nice money.

Of course abnormal conditions can arrive, as we have seen lately. All of a sudden it is not little waves, but huge waves that come. One extra large unexpected wave can do the damage. It is then, that the gain or loss to Mr. Brown or Mr. Smith can be heavy, wiping out swiftly any profits which one or the other might have accumulated over a lengthy period of ducking and diving. Naturally the lucky man holding the right currency is extremely pleased at that point.

Since it can take a longish time for the loser to get out of trouble before the cycle turns, he has to be prepared for it. For this reason, it is vital not to make investments of this kind with borrowed money, but only with money one can spare. To recoup in due course, one must be patient ad not be upset I having to wait.

When conditions are very volatile, it is dangerous but can be profitable. Not everybody dares to enter that arena. At the moment, the gentle opportunities of rocking up and down are hard to find, but not impossible, a lot depending on which currency one is holding.

In the currency game anything can happen, and it does.

It is strange, but when you desperately need to win, it will seldom happen. The time one wins, is when one is not desperate to win.

If you keep your head you can have plenty going for you in the foreign currency trading. The key is to play with your own money and not with borrowed money because you cannot be sure what will happen and when. There are chances of getting out of trouble when things go wrong if you have the time to wait. Sometimes a big wave can slow you down or help you, but if you are ready for the worst, the odds are you will survive and make money.

Impatient willy-nilly investors in this game do not last long. Patient ones can get out of trouble if under pressure, and fight on with good chances to do well in the long run.

Paul Dubsky

Paul Dubsky is director of Foreign Currency Exchange Services Ltd. The company is focused on being able to offer really friendly currency exchange rates. We believe we are the only Foreign Currency Exchange company which offers special rates to Senior Citizens.

A currency deal brings a winner and a loser, trade with money you can afford not with borrowed money, it is fine to take small profits but watch out for danger waves, only patient investors can survive.

Some Words and Some Knowledge Regarding the Foreign Exchange Market

Whether you call it Forex or Fx, you are talking about the Foreign Exchange market. This is where the trading of currencies, one against the other, is done. To have an idea just how big the action is, add all the stock exchanges in the world together and the Foreign Exchange will still be bigger!

When you consider that various speculators, hedge funds, governments as well as companies, plus countless private investors who take part, it is hardly surprising that this market is so strong and that the estimated daily average turnover of the foreign exchange market is over 3 trillion US Dollars.

By far the most asked for rate is the SPOT RATE. This transaction has to be settled within two business days.

With London, New York, Tokyo, Frankfurt and Sydney as the chief trading centres, the action hardly ever closes.

When you are at an auction and you put your hand up, it means you are bidding for something at a certain price. In a similar way, the word BID refers to the price at which the buyer is prepared to buy the currency.

The OFFER means the price at which an amount of currency the seller is ready to sell.

A LIMIT ORDER is when you give instructions the buy or sell a currency at a predetermined exchange rate.

When international banks buy and sell between themselves, the bid and exchange rates are called INTER- BANK RATES.

The difference between the bid and ask price of a currency is the SPREAD.

STOP LOSS is when an order is given to purchase or sell a currency at a price level set by the client on a particular trade which if reached, will close out the particular position at the stated price.

TRANSACTION DATE is the date on which a foreign exchange trade is being done.

The date which foreign exchange contracts settle is called the SETTLEMENT DATE.

Every currency has a three letter code such as for the Euro (EUR), for the British Pound (GBP), for the US Dollar (USD), for the Japanese Yen (JPY), for the Australian Dollar (AUD), for the Swiss Franc (CHF), for the Canadian Dollar (CAD). Actually, these are the major trading currencies and all commonly traded currencies are called the MAJORS.

CABLE is a name given to the US Dollar/British Pound rate in the foreign exchange market.

EFT is the Electronic Fund Transfer which is the transfer of money between banks.

When there is a quote in currency pairs, remember that the first currency is called the BASE currency. The second currency is called the COUNTER currency. As an example when you get a quote GBP/USD at 1.96 it means that for one GBP you will get 1.96 USD. So for ten thousand pounds you will get nineteen thousand six hundred US Dollars.

The many foreign currency exchange companies which you can find on the internet will gladly give you a quote, and by phoning around you can find the best currency rates. They will be better than a high street bank is likely to offer and they will give you a very fast service. Furthermore, most of them will not charge you any commission or the cost of the electronic bank transfer.


Paul Dubsky

Paul Dubsky is director of Foreign Currency Exchange Services Ltd. The company is focused on being able to offer really friendly currency exchange rates. We believe we are the only Foreign Currency Exchange company which offers special rates to Senior Citizens.

The meaning of foreign exchange words, description of the forex market, the currency rates of the foreign currency exchange companies.

Keeping in Touch with Some Basics How Banks Operate

There are some people who may wish to know a little about what banks are all about, especially when these financial institutions have had to swim in rather troubled waters just lately.

Banks are here to make money. It is hard to manage without them, and it is hard for them to manage without us. On the face of it, this looks like a marriage made in heaven. However, since all marriages are based on absolute trust and hate turbulent situations, and because these two features seem to be coming into play, it is not surprising that this is causing a certain amount of concern to depositors.

Basically, a client places money into his account. The bank will lend that money to other clients and make a profit on the deal. If the client banked say $10000, the bank can lend $90000 out because they must maintain a 10 per cent cash reserve ratio. In other countries, the cash reserve ratio requirement can be higher or lower. Any country can decide to alter the cash reserve ratio if needs be.

There is nothing to stop a bank to set aside more than the required minimum, meaning having excess reserves. It is not particularly rewarding for banks to do this, since they get no interest on that money, albeit they can channel it out on short and overnight terms to banks which need to maintain their minimum reserve ratio.

Getting back to that $90000 the bank can lend out, and let us say grant overdrafts but creating of course a liability factor, as the bank has to pay out whenever the various borrowers issue their cheques.

The position of the bank is that it has a total cash sum of $10000 received.
However, it has lent out deposits of totalling $90000. Add this together and you get a figure of $100000 representing total assets which are the $90000 in overdrafts plus the original $10000 cash received, which of course includes the required 10% reserve.

What took place is that the bank granted loans worth $90000 giving birth to money which did not exist before, based on the $10000 received in cash and locked in the safe.

People do not put in all the money on the same day, and they do not take out all the money on the same day. Cash in form of bank reserves is there to meet some withdrawals that may possibly be required. Banks have been managing quite well with small cash reserves in their safe, because they hold a number of liquid assets which they can sell for instant money. It is better for them to earn more money out of these liquid assets than having cash. Bankers are clever enough to know what kind of mixture of investments they should hold not to be caught with their pants down.

As well as lending money both short and long term, banks place investments in other areas. For instance, apart from the liquid assets, they can purchase long term government bonds and other securities. However, without cash reserves it is not possible to give birth to additional money unless breaking the rules.

Of course banking is far more intricate than that, but at least one can grasp some basics, and understand why, when a spanner is thrown into the works due to whatever reason, hiccups can follow.


Paul Dubsky

Paul Dubsky is director of Foreign Currency Exchange Services Ltd. The company is focused on being able to offer really friendly currency exchange rates. We believe we are the only Foreign Currency Exchange company which offers special rates to Senior Citizens.

Bank investments, the meaning of cash reserve ratio, concern for depositors, excess reserves, birth of money, liquid assets, government bonds.

Let Us Not Forget the Pendulum Factor of the Foreign Currency Exchange

Last year is gone and buried. Many have seen better years and are anxious to see what will develop now.

A big percentage of investors in the foreign currency exchange game will be focused on two runners only, namely the US dollar and the euro. Of course, there plenty of other runners to select from, but those two are bound to be in the spotlight.

While the pendulum might still have a little room to go against the dollar, it is getting uncomfortably near the point of return when it starts on the swing back journey.

It is now, that it would be prudent to find the best foreign currency exchange company to select from. Quite a number are available on the internet. Find out who gives the best currency rates and get acquainted so that you can be ready to spring into action as the time is coming when things will start popping.

One thing you must remember about the foreign currency exchange companies, they are only too happy to see you make right decisions. They are not there in the role of a guesser, but as a tool for getting you the best currency rates as quickly as possible. If they were not good at it they could not survive.

To know the exact point of the pendulum return, it is necessary to be a clairvoyant. There is no clairvoyant who can give results before the event takes place, because there would not be any bookmakers left. I can confidently report, that there are plenty of rich bookmakers in the world.

So it boils down to taking a calculated risk as to when the pendulum will swing back.
Before taking such a risk, especially in the foreign currency exchange, it is prudent to have some odds in your favour.

Granted that the pendulum might have a little room left to keep going against the dollar, but at this stage of the game it takes a bold person to purchase euros at such a high price even if there could still be some room left for a profit. On the other hand, the dollar is cheap and when it comes to life, not if, there will be room for substantial gain.

Since the odds favour the fact that a pendulum has to swing back sooner or later, the answer is plain to see. Of course it takes nerve and courage, but those are necessary ingredients which point to big money.

Incidentally, the pendulum swings also when it comes to the property market. Make sure you are ready and in touch with a realtor you feel happy with. There are many good ones who have fantastic properties on their books right now.

It is worth mentioning that an analysis as to how most millionaires have amassed their fortunes in the past, shows that property was always the main factor.

The formula we are all aware of says buy cheap and sell high. It does not say buy cheapest and sell highest because there is no way to really know the cheapest and highest points.

I would say the important thing is to make the decision when the time looks good enough to spot a winner, and go for it.

I remember a friend of mine who, in his prayers, used to ask God to guide him to a winner and also asked him to make sure for it to be a big priced one!

Greed can often spoil the best of chances.

Paul Dubsky

Paul Dubsky is director of Foreign Currency Exchange Services Ltd. The company is focused on being able to offer really friendly currency exchange rates.

Foreign currency exchange, the swinging pendulum factor, the US dollar and the euro, foreign currency exchange companies, odds in favour, nerve and courage,realtors and fantastic property, purchasing at the right time, being greedy can be detrimental.