amex euro -> dollar rate whaaa?

[RainDog]

okay, I sent in euro traveler's checks that belonged to my kids to convert them to $. I had to have them deposit the dollars in my acct., so I've been checking b/c you have to send them certified mail, they charge a fee (not large) for the conversion to currency, they had three days from the time they received them to do the conversion.

I expected them to wait (or not) for the lowest rate, and I've been following it daily.

Soooo, they did the conversion at 1.43. Currency rate listings over the time I sent to them were 1.54 up to 1.58. They sent me a letter that said... the rates you see aren't the rates you get because you have to be dealing in at least a million dollars to get that rate.

I assume, then, that they pull the other rate out of their asses? (actually, I'm sure they have some reasons they give- but wtf? when I purchased those checks for my kids, the rate I paid was based upon the going rate listed...the same one you see in the newspaper, etc.

but if you're redeeming them, you receive a lower rate? this really pisses me off... I mean, if I have to pay the "millions of dollars" rate, why don't I receive the same?

in any case, fwiw, the rate of "return," even with the crappier rate, was 44%.

I don't know of any small scale "investment" that would get that rate of return, plus be so convertible (in theory.) My kids were really ticked at me that I wouldn't let them convert the checks earlier and put them in their savings, but I told them they would go up in value. the money had been in a blue chip roth ira that lost money and even started dipping into the principle, so by doing this, I earned back the principle plus some profit. And if the money had been in their savings accts this whole time, they might as well have had it under their beds.

[whistle]

1. There you have it, BushCo is an agent of the International Bank Cartel

...and this is what they have been working for for the past seven and a half years!

[RainDog]

3. ...

:spank: :spank: :spank:

[sergeiAK]

2. Yeah, I think they're screwing you

As even for a 1m lot, I'm looking at $1.5771 for the Euro/dollar rate. That's on the FX markets, and if it was really possible for them to get Euros at $1.44, they'd be the richest people on Earth right now, as the FX markets are the most liquid, and have some of the lowest margin requirements of any market out there.

Hell, if I can get that kind of rate, I'll put up millions on margin, since that's roughly %8 return (on unmargined funds, since FX operates at 100:1 margin, that's closer to 800%) in approximately 10 seconds.

I'm calling bullshit on their explanation.

[RainDog]

4. you are WAAAY over my head, in financial speak

my "investments" over the last few years have consisted of "commodities" that I have knowledge of... rare and out-of-print books bought at bargain basement prices. I'm not flush enough to be a big timer.

however, some of the things I purchased for 30.00 five years ago currently sell, and, yes, they actually sell, for 400.00

I assumed it's better to deal with something you know about. I couldn't believe a $%&# roth ira could be so crappy. the markets aren't made for the small timers like me.

[A HERETIC I AM]

5. It isn't the Roth IRA that was crappy, but the investments inside it...

something you had (or should have had) complete control over.

The Roth, or any IRA for that matter, is merely an account, not an investment. You could have invested in almost anything you liked, as long as it was a marketable security.

[RainDog]

6. yes, and it was in blue chips, mostly. conservative...

like I said, I am not a player. I chose from various potential pkgs... and the one I chose was conservative. I was not under the impression that roth ira investments were constantly changed like day trading.

I could not afford to continue to lose the principle on the idea that the stocks would recover over time because my kids would need the money sooner rather than later. I thought I was putting them into something that would do better than a savings account without a lot of risk.

but just to reiterate- I do not play the mkt. I don't have the money, inclination nor time. However, I assume if something is presented to me in such a way, those facts will actually matter... like the rate of exchange, for instance, or the idea that a conservative ira wouldn't lose so much money that I would have been better off to put it in a cookie jar... if I had a cookie jar.

my b-i-l is fairly successful playing the mkts, so I hear, cause rich ppl have asked him to buy for them, and that's not his job... but he refuses b/c that's not his job...

I'm a mom who was trying to earn some money for her kids' money. I did. So, I consider that a success... as I said, I recovered all lost principle and still made a good % on the money.

I don't manage funds of my own, such as they are. I use TIAA-CREF. Again, if I had to deal with that stuff myself, I would just put my money in a savings acct. and say so what... at least I'm not losing money. a real luddite. :)

[sergeiAK]

7. Commodities markets are all very similar

I got my start in a similar manner to you (the first thing I sold was yarn, then I moved into truckline salvage/goods at estate auctions), and developed that into a small business. Now I trade commodities/stocks/options as a "hobby" business, and do well enough to support my other hobbies with it.

The markets are stacked against the small-timer, 'tis true. However, much of that is simply a matter of education, discipline, and time. When I started out (with a relatively tiny amount of money), I lost ~25% in the first 6 months. I considered that as my "tuition" to market school :P I paused, educated myself, and made a plan, then resumed trading for a while. It takes time and dedication, but success is possible, though it's quite time-consuming. Good tooling, good education, a bit of luck, and most of all, a plan are what is needed.

If you want a bit more info, I can post the learning materials that I used. They made a huge difference for me.

[EvolveOrConvolve]

8. I'd like that information if you don't mind

I'm ignorant when it comes to things like this.

[sergeiAK]

9. Here's a start

For general investing, I used various web resources, mostly the Business/Finance forum on SomethingAwful. Not a scholarly source, but there are several good posters there who know what they're doing.

For options, I used www.888options.com and www.thinkorswim.com (also my broker, I recommend them highly) to learn the basics and the more advanced strategies, respectively. 888options has a useful strategy screener that shows you what your profit and loss will be given a certain move in price.

For stocks, I use google finance to do most of my research, and morningstar to back that up. Learning to read a 10K/10Q is difficult, though highly worth doing.

For day/short term trading, the book "High Probability Trading" by Marcel Link was a worthwhile read. Anything by van Tharp is also worth a read, if you can find it.

The Marcel Link book included the most useful info for a small account trader, as it went into great detail on how to size positions and how to set stops and limits.

Thinkorswim has a great tool called PaperMoney, which gives you $100k in fake money to trade with, everything else being the same as a real account. It's the exact same tools I use in my real account, and allows you to learn all the lessons I did with real money sans the stress of watching your account lose a real $2k in one day.

That's roughly how I got started.

[EvolveOrConvolve]

10. Thanks for the info sergei!

I actually read SomethingAwful quite a bit, but have never ventured into the Business/Finance forum. It's interesting where some of the smart people hide out on the web. :)

I'll take a look at the other resources you mentioned.

Thanks again!

[sergeiAK]

11. No problem

I figure since others helped me get started, I can at least pass the info along.

Thinkorswim also has a great "trader chat" feature, where you can chat with other traders logged into the system during market hours, then every thursday at 4:15 EST (15 min after close of markets) they have a professional (generally their Chief Derivatives Officer) do a tutorial on a particular options trade and its benefits/risks.