From: "David Johnstone" 
Newsgroups: uk.finance
Subject: Re: Money Transfer/Exchange Rate
Date: Mon, 11 Jul 2005 19:19:45 +0200


"john boyle"  schrieb im Newsbeitrag 
news:O4WjSeNi2Y0CFwQ7@johnboyle1.demon.co.uk...
> In message <1120810326.730375.14690@g44g2000cwa.googlegroups.com>, David 
> Johnstone  writes
>
>>Alternatively they could quote me a floating rate plus a margin,
>
> Eh? What would that 'floating' rate be? There isnt one.
>
>>e.g. Libor plus 0,5% or something to that effect.
>
> What have interest rates got to do with it? In any event 'LIBOR' for

Oh yes, true, I got that a bit mixed up.
Isn't it common though to agree on a particular value, maybe
a market price from a ticker e.g. as reported by a particular
Reuters symbol or similar? For things like knock-in options that
would be the only way really.

> smaller amounts, and for usual periods, is far far far less volatile than 
> currency rates. For larger amounts (substantially larger than currency 
> dealing thresholds) LIBOR is agreed on a deal by deal basis so you would 
> never be able to pin it down in advance without entering into some form of 
> forward contract. So if they quoted you a 'margin' you would be in no 
> better position than you are now because you have no way of knowing what 
> LIBOR would be.

Of course I wouldn't know in absolute terms how much I would get.
Neither would I know if yesterday or tomorrow would be better.
But I would know what the bank was charging me and I could compare
it with other banks.

David