Buying US dollars

Author
Discussion

shedman

Original Poster:

32 posts

207 months

Monday 16th April 2007
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Hi, this might sound incredibly naive but bare with me.

With the state of the US dollar right now I was thinking it might be a good idea to buy a bunch - anyone know the best way to do this to get the best exchange rate and pay the lowest commission?

I've done some research on t'nternet and now feeling confused!

Zimbabwean dollars anyone? eek

vex

5,256 posts

248 months

Monday 16th April 2007
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For us who buy stuff in USD, it is a great way of improving margins.

Due to make my next payment in a week or so, so that should improving margin by 10 - 15%!

northernboy

12,642 posts

259 months

Monday 16th April 2007
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Which bank are you with?

I got HSBC to open me a USD account and now I just buy via the online banking website, by going to the "international transfers" link. I think that you can only move about £10,000 per day like this, but if you want to do more, you can call your branch manager to ask them to move more for you. They seem to charge about $0.015 from mid, but, as they fix it at about 09:00 each morning, you effectively get a free option for the rest of the day, so I normally end up trading at around mid-market.

Even if you are with another bank, check out doing it the same way.

Remember that it is still somewhat of a gamble. If it was really a one-way bet, there would be no trades going through. There are still people buying pounds by selling dollars at the moment. Some of this is driven by the expected future interest rate differential. Basically, people expect that you can borrow USD, sell them, and invest in GBP, and get enough interest to make a profit.

leosayer

7,320 posts

246 months

Tuesday 17th April 2007
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I'm considering buying a unit trust which prices in USD, so I've got currency and market exposure.

Shadytree

8,291 posts

251 months

Tuesday 17th April 2007
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over 2 now

northernboy

12,642 posts

259 months

Tuesday 17th April 2007
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I did a very geeky thing, and took a screen print from Bloomberg when it went over.

There was a bit of a cheer oer the floor, as everyone had been watching it since the inflation figures came out.