currency exchange

August 15, 2007 7:31 PM

Any opinions about foreign exchange brokers? How can one even tell who does only trades & who actually converts currency?

I'm mostly interested in moving currency from dollars to euros, but trading is an option.

I was almost done with XEtrade's week long signup process, when they screwed me over by being unable to correct a type-o, restarting the whole bureaucratic nightmare. So I'm done with them.

But most curency brokers I've found only care about trades, they won't actually convert anything! For example, OANDA is primarily about trading but offers various toy features for "travelers" & such. Forex.com doesn't even pretend they'll convert currency.

Custom House, the muscle behind XEtrade, apparently has everything you'd want, but their site sucks, especially in Safari.

Experiences?

p.s. I never was sure who gives better deals : Custom House or XEtrade.

posted by jeffburdges to work & money (13 comments total)

What do you mean by trading versus converting currency? They're the same thing, as far as I can see—you can't change a dollar into a euro without selling the dollar and buying the euro; both the dollar (or $1.40) and the euro (or €1.40) exist both before and after.
posted by oaf at 8:05 PM on August 15, 2007

Please step away from the brokers until you actually know what you are doing and can use the proper terminology.

No, seriously, you can lose all of your money very quickly if you try to play with currency and don't understand what is going on.
posted by b1tr0t at 8:16 PM on August 15, 2007 [1 favorite]

(or €1.40)
posted by oaf at 8:24 PM on August 15, 2007

It is not clear what you want to do:

1. Do you want to convert some dollars to Euros so you can go to Europe and spend the money?

2. Do you want to convert some dollars to Euros so they can sit in a money market account for a long time earning interest and also appreciating/depreciating as the value of the Euro vs the Dollar changes?

3. Do you want to convert between Euros and dollars repeatedly, going back and forth as the market changes so that you can make oodles of money very quickly?

If your answer is 3, I would take b1tr0t's advice. If your answer is 2, you could look at Everbank. 1 shouldn't be so hard, but I don't have a specific recommendation.
posted by alms at 8:39 PM on August 15, 2007

The answer to 1 is to use a credit card with a low foreign-exchange fee.
posted by oaf at 9:14 PM on August 15, 2007 [1 favorite]

BullionVault lets you buy a gram of gold in dollars and immediately sell it in Euros (or Pounds) for a smaller fee than you'd pay at the airport.
posted by jayCampbell at 10:23 PM on August 15, 2007

I've no interest in trading, money is going one direction. I want them to take dollars from a US bank, convert it to euros with some tools to pick an advantageous time, and put euros into a European bank.

I'm paid in dollars but live in europe so I want to limit my exposure to the declining dollar. And losing some to a stronge dollar doesn't bother me since I'm still paid in dollars.

I've been using oaf's idea about credit cards and atms, but this still costs 1%.
posted by jeffburdges at 1:08 AM on August 16, 2007

So you're basically wanting to create a hedge? Unless you're trading at interbank rates and quantities (transactions in the millions of units), the spread will likely wipe out your gains.

As a former employee of one of the trading firms named above, I can't second b1tr0t's advice enough. Seek out a qualified financial advisor.
posted by scruss at 6:50 AM on August 16, 2007

I'm paid in dollars but live in europe so I want to limit my exposure to the declining dollar. And losing some to a stronge dollar doesn't bother me since I'm still paid in dollars.

Check with your local big European banks. A bank like ING or HSBC should let you have an EUR-denominated account, but make deposits in USD. They should give you a reasonably favorable exchange rate.
posted by b1tr0t at 7:30 AM on August 16, 2007

No, I'm not looking to creage a hedge, that would be too risky, and it wouldn't eliminate the 1% VISA tacks onto my cost of living. I'm just looking to move money, balancing my risk between dollar decline & euro decline.

I'll talk to some European banks about their incomming exchange rates. I've not seen favorable rates before, but that was another country.
posted by jeffburdges at 7:41 AM on August 16, 2007

b1tr0t: what's the best way to learn that stuff?
posted by bonaldi at 10:05 AM on August 16, 2007

b1tr0t: what's the best way to learn that stuff?

Read books, google around, check wikipedia. When you start, it will look like most of what is said is reasonable. You are in good shape when you think that 90% of the stuff you read is BS.
posted by b1tr0t at 6:18 PM on August 19, 2007

When I moved to Australia, I used a specialist FX company as described at http://movingmoney.net to avoid being ripped off by banks.

The type of currency conversion you are looking for is known as deliverable foreign exchange, where money is actually delivered to an end user rather than just being traded between different currency accounts.
posted by dbateman at 1:25 AM on September 9, 2007