Patrick KunzKeymasterHi Hans,
- January 8, 2024 at 1:34 pm
i meant both the real FX trading and the auto FX you instruct your bank.
I have seen the same as you with some clients which is amount based. Low amounts start at 120 basispoints and this goes down to 20bp with higher amounts. Most often you exchange small amounts and if you do a lot of these transactions then 120BP margin can hurt a lot and has a big potential saving!
I also worked with client where the bank has a fixed margin for these transactions. ING at 80BP and Rabo around 70-90BP fixed independent on amount. Still high and if yearly volume high enough it is viable to look into doing FX deals yourself instead of auto trading at your bank.
For normal FX trading it is worth to check margins yearly. I sometimes work with external partners who can do an independent audit on FX margins including a SaaS platform and auto upload of FX confirmations to continuously monitor your FX deal margin per counterparty and currency and timing of the day. Usefull information.
Happy to hear other opinions here!Treasury for champions