Nix and Mike

I know this question has been asked before, but I cannot find the response.

Has anyone transferred funds back and forth btwn two currencies in order to take advantage of exchange rate fluctuations? (i.e. a form of currency trading, although less sohpisticated as it would involve two bank accounts that belong to you).

I have two questions:
1. Is this legal?
2. Are their any tax implications?

Just a thought....

Nix

oz miller man

interested to see a reply to this as ive a friend whos been doing it last few months
hes sending money back to uk then back to oz making 2-4 grand a week .

harrip

Yes, its legal, yes it has tax implications. But if you were serious in trying to make money this way you probably would not look to actually keep sending money around the world, but use a Forex Day-Trading system (do a google).

Personally I would not touch with a barge pole as gearing can become involved if you so wish and your losses therefore much greater than just the amount spent. You may as well go play poker at the casino.

jayr

Not quite sure why a private individual believes they are likely to be better at FX trading than banks who presumably attempt to take all sorts of information into account like forward interest rates, budgets, CPI, employment, producer price indices, farm outputs etc, intercountry trade barriers etc.

FX has fluctuated a lot recently based on the fundamentals above and on relative business and consumer confidence. Of course, FX trading is a zero sum game; every $1 gained has been lost by someone else.

sassie

I know someone who was involved in currency trading. ended up having to remortgage his house - he lost thousands!

bagspacked

Definetely not as easy as it sounds.
If you had bought the dollar last year you would have seen it hit the deck over the past 6 months. There are no guarantees.
You need to be moving very large sums to be making 2k and the next week you are just as likely to lose 4k

lesleys

You can set up a single bank account with 2 currency components and switch between when rates are advantageous. The bank will always take a cut but you can still have it work to your advantage. Of course it's taxable.

Nix and Mike

Comments here have been very valuable. I don't think I would ever get into forex trading where you stand to loose plenty.......but transferring actual money (ie not simply digital money) is less risky......
Something just feels "wrong" about it.....maybe I am too "niave"? !! LOL !
But money is money !

THANKS for the replies !

Nix