Exchanging currency

Exchanging currency is all about timing and finding the right moment. You can also add belief and luck to it, but we are not talking about lottery here. Currency exchange is unique in that it can be manipulated and brought to your advantage if done right. Our previous blogs mentioned the factors that influence currency exchange and decision making. Here we will explain when is the best time to make a move.

There is Growth

Be it a country’s economy, a company’s finances, or even accumulated capital, growth is very important to consider when you want to make money. For example, the wisest investment decision you could have made as a domestic company in 2010 was to invest in as MANY US dollars as possible. That way, if you sold your USD for CAD, you would have made a raw profit of 30-50 percent (due to the depreciation of the CAD). Considering that the yearly inflation rate in Canada is approximately 2 percent, that is still more than 15 percent net profit over 6 years. Therefore, always assume growth as a potential factor for investment decisions.

Find the Peak

No, we are not asking you to climb a mountain and reach its peak. All we suggest is to make sure to analyze the currency trends over a longer period of time (starting from 6 months and up). That way, you can see a bigger picture of the ups and down of the currencies, and decide whether or not you should wait or invest now.

Assume the Worst

A wise decision is a decision that you will not regret making. Always ask yourself before investing, what is the worst case scenario? Will I lose all my money? Will I gain anything at all? These questions will keep you on the safe side and make your investment decisions more realistic.

Always Double Check

Do not trick yourself into believing that your investment decision will work a hundred percent of the times. Be sure to get advice from another party with knowledge in finance, and see if your opinions match. “Two heads are better than one” and “better be safe than sorry” are perfect expressions in this situation. Personal experiences have told me that relying only on yourself is not the best decision.

Do not be afraid

Once you have compared all the pros and cons and confirmed your investment decision with another party, do not look back. You must be committed to fully finishing your business and completing the transaction.

To learn more about exchanging currency or make currency exchange transactions – contact us today!