Dumb question about currencies

[fiatdave]

If I fund my account with USD and my base currency is different than USD? I am not sure that I explained my question very well.
Does the base currency get exchanged at the current USD/other rate?
Probably a stupid question and now that I asked it I think I get it.

Thanks

Fiatdave

 

[Rhody Trader]

The real question is whether you're funding an account with your non-home currency, and if so, why?

 

[arabianights]

It'll get exchanged, most likely, at your credit card/bank's exchange rate, which'll be typically a spread of 2-5%.

This isn't a dumb question, btw. Amazing, cause most questions on this site are dumb, whereas yours is a sensible question worth taking into account (it may be easy but that ain't the same as dumb)

 

[meanreversion]

If I fund my account with USD and my base currency is different than USD? I am not sure that I explained my question very well.
Does the base currency get exchanged at the current USD/other rate?
Probably a stupid question and now that I asked it I think I get it.

Thanks

Fiatdave

Not a stupid question. The answer depends on what you're trading. For example, I have an account with Interactive, where I deposit GBP. In order to trade futures on CME, I need USD for margin. I don't need to transfer GBP into USD.. what IB will do is credit my GBP account with receiving interest (at a rate of 0.0%, base -0.5) as I am long there, whilst charging my USD account at a rate of 1.5% (base+1.25%), which is where I am overdrawn.

OR I could sell GBP to buy USD and then it would just use some of the USD for margining purposes.

Is this what you meant?

 

[fiatdave]

If I wanted to trade EUR/JPY and my home currency was USD was the question. Sorry I am a total newbie and my grammer leaves a little to be desired.

I did get a great tip from the forum. In another post someone recomended babypips to another member. Wealth of information for some such as myself. I have already passed 1st grade. LOL

I was considering Maverick FX Trading for getting the training I need. However I couldnot find a lot of information about them. So I decided not to pay $1000 to join their firm.

Thanks for the replies, I am sure I will have many more questions over the next few years.

Fiatdave

 

[Rhody Trader]

If you have a USD account and you trade EUR/JPY your profit/loss on the trade will be converted at the current USD/JPY rate.

 

[MrGecko]

won't it also depend on whether you are actually trading spot EUR/JPY or making a $12.50 per tick type of trade...??