To the great minds at Forex Factory and anyone whose had experience with international wire transfers for large corporations....
I interviewed for a job at a publicly traded corp. that involved wiring massive amounts of money 50 million+ to foreign destinations from time to time. They didn't seem to have any plan for monitoring the markets and simply used the bank exchange rates. The bank supposedly allowed them to lock their rate for a week and then proceeded to charge them 10% off the top in fees. But there didn't appear to be any risk management despite being a large bank.
I am a small-time retail trader. But it seems to me they are losing millions of dollars doing it this way due to fluctuations in the market.
I am curious if there is a better way to do this. I looked up a discount foreign exchange broker (not a trading broker per se, but for corporations transferring money) on the internet and they said they had forward contracts for a year. They also allowed you to place bids on rates and offered to monitor 24/7 for selected date periods.
But the question becomes, are some corporations actively trading Forex in this way? Do they have their own analysis departments monitoring the markets? Obviously, the company I interviewed for did not. Even in the above scenario, you'd need someone to set the initial bid which would require extensive analysis. And, if money is needed immediately in other parts of the company, managing risk in this way might not be feasible.
I interviewed for a job at a publicly traded corp. that involved wiring massive amounts of money 50 million+ to foreign destinations from time to time. They didn't seem to have any plan for monitoring the markets and simply used the bank exchange rates. The bank supposedly allowed them to lock their rate for a week and then proceeded to charge them 10% off the top in fees. But there didn't appear to be any risk management despite being a large bank.
I am a small-time retail trader. But it seems to me they are losing millions of dollars doing it this way due to fluctuations in the market.
I am curious if there is a better way to do this. I looked up a discount foreign exchange broker (not a trading broker per se, but for corporations transferring money) on the internet and they said they had forward contracts for a year. They also allowed you to place bids on rates and offered to monitor 24/7 for selected date periods.
But the question becomes, are some corporations actively trading Forex in this way? Do they have their own analysis departments monitoring the markets? Obviously, the company I interviewed for did not. Even in the above scenario, you'd need someone to set the initial bid which would require extensive analysis. And, if money is needed immediately in other parts of the company, managing risk in this way might not be feasible.
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