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I have a problem with understanding Bid/Ask quotes……example
spot SFr/pounds 2.3140-2.3210 if I have 750 pounds and I need to convert them to SFr to pay my fixed costs which rate should I use. and if I want to convert my SFr to ponds which rate do I use?If the company is buying the first quoted currency (in this example SFr) then you use the lower rate (2.3140).
If the company is selling the first quoted currency (Sfr) then you use the higher rate (2.3210).I do suggest that you watch the free lectures. The first of the lectures on foreign exchange risk management spends time on which exchange rate to use (and why).
Thank you , will watch them……….in this case the pound is the local country currency
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