Account base currency: USD or EUR

Beginner Questions
1

Hi All,

I am considering to open a live account soon and I need to decide what base currency to use. I live in Europe so EUR seems a convenient option.
However, with USD being so week and EUR being so strong I was wondering what are the implication of the strength/weakness of the account base currency .

I was thinking that now I could convert my EUR into USD at a very good rate and I guess it is very likely that at some point in the future USD will gain back its strength. Hopefully by that time I’ll have some profit in my account to take out. :slight_smile:

I’d be grateful to know the opinions of the experienced traders. Is there any point trying to play with the account base currency since it is something that I wouldn’t change every time the price changes.

Thanks for your advice!

Alvo

2

Hi All,

Obviously this topic didn’t generate much interest…

Does it mean that it is pointless to try to take advantage of the weakness/strength of a currency when it comes the time to decide about the base currency of a trading account?

If you make 10% profit it is going to be 10% regardless of your base currency but if you what to take that profit out then the real profit will be affected but the price change of the base currency. That’s correct, isn’t it? :confused:

I’d appreciate any opinion on this.

Thanks for your advice.

Alvo

3

I am considering to open a live account soon and I need to decide what base currency to use. I live in Europe so EUR seems a convenient option…

The difference in the rates between depositing the money &
withdrawing the money is marginal. Therefore it is more
dependant upon your broker.

How easy is it to transfer in Euros?

IMO if you live in Europe & your currency is the Euro then
trade in that currency.

:wishes:

PS

Obviously this topic didn’t generate much interest…

You are right, though, there are a lot more important questions.

4

If you are worried about problems with your base currency (which you would be if you were American) you could hedge it by taking a long term position in a cross. The effects are probably marginal though as you keep as little money with your broker as possible and the rest in a dependable bank (probably not UK building society right now!)

5

Hi,

Thank you two for the comments.

I guess at least there is one thing I need not to worry about then. :slight_smile:

Of course it is much easier for me to do everything in EUR so I’ll just stick to it.

Thanks again!

Alvo

6

Alvo, did you deposit your money in EUR then? I also live in EU and I’m not sure yet if I should convert EUR in USD or not.

USD is on all time low compared to EUR, but if the dollar bounces back, I’ll just get fewer EUR for USD, so it doesn’t make any sense… or does it? :slight_smile:

All I know is that my stock investments in US are now worth much less than they were two years ago :frowning:

7

Hi Treehugger,

No, I haven’t opened a live account yet…

I was thinking in the same way as you did, hoping for USD getting strong again.
But after reading the comments of others I am less concerned about it.
I guess if I do not need to convert the deposit/profit it doesn’t really matter how EUR/USD is changing.

Alvo

8

OK, thanks for your reply.