Forex Help Forum Archive for 02/21/2005

melbourne farmacia 23:24 GMT February 21, 2005
Subject: Reply   
Brisbane P 07:51 GMT February 21, 2005
Thanks mate.

Sydney 22:30 GMT February 21, 2005
Subject: Reply   
Shanghai BC I recall some time ago you gave some studies for the hourly chart.. RSI 9 stochastic slow 14.3.3. is that correct. thanks

Rye, NY et 18:24 GMT February 21, 2005
Subject: Reply   
Vail MC 17:53 GMT February 21, 2005
Pretty easy here at GV. Just go to the frame at the right of the page, click on "Data and Tools", then click on "IMM Swaps"....GL/GT

Vail MC 17:53 GMT February 21, 2005
Subject: Reply   
can anybody tell me how to convert future prices to spot prices. TIA

quito_ecuador_valdez 15:56 GMT February 21, 2005
Subject: Carry Trade - the whole theory Reply   
It was mentioned below that an "unhedged carry trade" can just as easily blow up in your face. To cement this firmly in your mind, if you are placing a carry trade of say AUD/JPY to obtain in round numbers 5% annual interest ($5000/lot/year or $13.70/day/lot), that's great income if you leverage 10 lots at 100:1..your actual cash investment for that 10 lots ($1M) is only: ($1,000,000/100)=$10,000 of cap...yielding a whopping $50,000 a year which is a 500% gain/year, barring evaluation or devaluation of the pair itself (remember we're talking AUD/JPY). Sounds incredible but true..hence the reason carry trades are so popular.. you obviously should be either optimally in a long (BUY AUD/JPY or buy JPY with AUD) or at least a neutral market of low volitility and no likelihood of the pair shorting. If you short the pair (buy AUD with JPY) then you reverse the interest and it costs you the same as you would gain in a long, interestwise.

BUT, (that word again) say if the Yen suddenly EVALUATES and/or the AUD suddenly DEVALUATES and the pair shorts; buddy your carry trade on AUD/JPY is in trouble and you HAVE TO CLOSE that carry trade immediately before it "blows back in your face" with losses from hades..which will quickly offset any carry trade profits. You have to keep right on top of things, it isn't a "set it and forget it" tactic.

How can you prevent this "blow back" of an "unhedged carry trade"? By hedging..that is, by using a second position called a "hedge carry trade" of another pair equal in lots as your AUD/JPY position...that acts opposite (more or less) of the XXX/JPY pair you carried. So if AUD/JPY screws up and shorts..your hedge pair will long..giving you a net of zero on the board but maintaining your carry trade interest..minus or plus any difference of negitive interest or positive interest on your hedge trade.

In carry trading, you don't care if you don't make any interest on the hedge position..or even a bit of negitive interest..the hedge hedges or compensates for your AUD/JPYcarry trade ON THE BOARD.

This changes too. Right now for example it looks like EUR/GBP is acting opposite of AUD/JPY so that therefore would occupy 1/2 of your total carry trade position set..the other half would be of course your original (for example purposes) AUD/JPY. It could be therefore often that you would change your hedge position to another pair which opposes your carry positon.

Since JPY has ZERO interest, it is sought after as a carry trade currency, bought with practically any other. Most platforms don't nave NZD/JPY (NZ has the highest interest rate in the world) but the 2nd best thing is the AUD/JPY pair. Piror to the U.S. Fed raising interest rates lately, the USD (was 1%) was also a carry trade goody, which explaines in part the popularity of the AUD/USD pair as well as the GBP/USD pair.

GVI Learning 13:17 GMT February 21, 2005
Subject: Carry Trade Reply   
This is a report discussing current carry trades going on involving the yen.

Yen slide on "carry trade" may be overdone... LINK

This is an extract from the report:

LOW VOL = CARRY TRADE

In an environment of low currency volatility, investors and speculators borrow cash in currencies like the yen where short-term interest rates are virtually zero to buy higher yielding ones.

These days market participants have favoured the New Zealand and Australian dollars as well as the British pound, among others.

"When there are no trends and a decreasing fear of risk, carry trades are the way people are going to go," said Marshall Gittler, senior currency strategist at Deutsche Bank in Tokyo.

Official rates in New Zealand stand at 6.5 percent, the highest in the developed world. Australia's benchmark rate stands at 5.25 percent and is expected to rise soon.

That compares with 4.75 percent in Britain and 2.50 percent in the United States where the Fed has lifted rates six times and has indicated more rate rises are on the way. Euro zone rates have been steady at 2 percent and Japan's at virtually zero.

Brisbane P 07:51 GMT February 21, 2005
Subject: Silicon Graphics Reply   
melbourne farmacia 11:26 GMT February 17, 2005
Subject: Silicon Graphics
SG monitor up to PC ?
You may need an adaptor or new cable

http://www1.jaycar.com.au/stores.asp
or
http://www.abcd.com.au/default.htm

They might be able to advise.

SG Aust Office:http://www.sgi.com/global/anz/