US traders of eurex

Discussion in 'Index Futures' started by sidchitown, Aug 22, 2005.

  1. I'm looking for some advice about how to hedge out euro currency risk. I just started trading my own money and I'm worried down the line about converting over my profits. I don't want to be in a crunch and have to pay $1.19 or somehting awful like that. Any ideas are welcome...
  2. Whatever you do will require much more effort than it is worth unless you are taking $5k a day or so out of the markets. I just convert my entire group's accounts on a consistent day once a month. In the long run, I have found that when I convert... doesn't make much of a difference.
  3. milstar


    Dear Sir

    hedge or win ? It is two different task .

    If hedge -

    a. buy two equal quantity of the money

    1000 euro and 1253.1 $

    b. synthetic asset

    buy 1 future eur/usd sell one call option
    and buy one put with equal strike price

    sell 1 future eur/usd sell one put
    and buy one call with equal strike price

    If you wish win , that is another task which related to
    your advantage as operator , wining-loss and risk-reward ratio

    In each case better participate on currency future market as spot market ,as last have not pure agents ,but only bucket shop
    /broker take another side of the client order ,also UBS/
    and this ,which promouted as pure agents -hotspotfx and IB
    reflected in he's books only 1% of the market /statement of IB/

    Sorry ,if author not understand your question correctly
  4. Sounds really funny to me.
    If you think you are capable "trading your own money", why don't you trade a bit EUR or so on the side. That should do the trick. No need whining at ET's about 'euro currency risk'. That's why people trade currency futures.
  5. milstar



    Clear both methods depend ,where operator is based
    and what he will make after money would converted back.
    Both have limitations

    Not only exchange ratio ,but relation to CPI would changed
    To answer this questions you must take simple example

    Startcapital 2000$ =2000$
    To start date

    Exchange ratio eur/usd 1:1
    Bottle of wisky price = 20$= 20 euro manufactured in USA
    Bottle of cognac = 50$ = 50 euro manufactured in Europha

    Operator can be based in Europha / have made 30% with
    asset in USA and after one year need euro back/ or in
    USA /have made 30% with asset in Europha and after one
    year need USD back/

    Or operator will buy most quantity of whisky or most
    quantity of cognac for best offer in EU or USA

    Take case after one year euro/usd changed from 1:1 to 1:1.25 and take case after one year euro/usd changed to
    1:0.8 . Operator can buy whisky and cognac after year of speculation in each continent for best offer .
    Price of whisky and cognac would react different to eur/usd relation change .

    Take also case that after one year one of the broker in USA or in Eurpoha can be crashed through terroristic act or take your money to he's pocket .

    And think what you will hedge ...

    CME have CPI futures ,but volume possible very small

    Best wish ....