Cross pairs portifolio

XxQuote399

Member
50 0
Hello,

How do you look into cross pairs ? on a broader sense

it is better to look only at majors and the positions you take give you a cross on the portifolio ? (I mean most of the times,Eur/Gbp for example would give long//long or short/short most of the times)

long aud/usd

short eur/usd

synthetically short eur/aud

My doubt is because there are a lot of pairs to watch but isnt redundant looking at them most of the times ? (I mean spend a lot of time looking in 30 pairs)

on that scenario its best to watch just the major and usd crosses most of the time ?


Thanks
 

Rhody Trader

Senior member
2,620 266
If you're talking just the major currencies you can only come up with 4 pairs (assuming you include NZD) to hold at any given time without creating overlapping risk. And even then that's just talking about having the same currency in multiple pairs. When you start talking about looking at correlations between currencies (like EUR and CHF at the moment), the options narrow further. So any real diversification in terms of forex pairs is a stretch. That isn't to say, however, that there isn't value in tracking/trading all of them individually.
 

NVP

Legendary member
37,750 2,097
why not look at INDIVIDUAL currency strengths ?

each of my single FXcorrealtor charts with 8 currencies displayed covers the equivalent of about 28 paircharts

N
 

jefftimothy

Newbie
5 0
Hello,

How do you look into cross pairs ? on a broader sense

it is better to look only at majors and the positions you take give you a cross on the portifolio ? (I mean most of the times,Eur/Gbp for example would give long//long or short/short most of the times)

long aud/usd

short eur/usd

synthetically short eur/aud

My doubt is because there are a lot of pairs to watch but isnt redundant looking at them most of the times ? (I mean spend a lot of time looking in 30 pairs)

on that scenario its best to watch just the major and usd crosses most of the time ?


Thanks

EUR/AUD is very good cross currency pair. Sometime I choose this currency pair for trading. Also GBP/JPY, EUR/JPY are good currency pair for trading. The problem is high spread imposed by broker on this currency pair. So I use this currency pair rarely.
 

XxQuote399

Member
50 0
We are kind of always synthetic a cross pair on portifolio

do you guys trade cross pairs or rarely ?

Thanks
 

Rhody Trader

Senior member
2,620 266
I can't speak for anyone else, but I certainly trade the crosses outright at times. Creating a synthetic cross costs you money on two fronts. First, you're paying extra spread. Second, you've got the carry spread working against you as well. For example, if you end up with a synthetic AUD/JPY long you most likely won't be getting the same amount of positive carry as you would if you were long the cross outright.
 

NVP

Legendary member
37,750 2,097
dont forget timezones...........the asian session always offers more action for AUD and NZD currencies

N
 

NVP

Legendary member
37,750 2,097
for me the CAD is probably my wildest card in the G8 pack.....the rest are pretty predictable regarding correlation and direction

NZD&AUD
USD&YEN
EUR,GBP,CHF
CAD

although I must confess that GBP can be annoyingly unpredictable in recent times

N
 
 
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