Pure FX Logo arrow Reviews On Feefo Pure FX Logo Exemplary Service In-Depth Knowledge We're Jargon Free Same-Day Transfers Better Exchange Rates Purefx_currency_exchange Personal Transfers Business Transfers Personal Service Trusted Brokers Get A Quote Register With Us Make A Transfer Seller Transfers Contract Definitions Read Our Top Tips What Influences Exchange Rates Glossary Frequently Asked Questions Contact Us

How Investors And Speculators Affect The Foreign Exchange Rate

GuidesHow Investors And Speculators Affect The Foreign Exchange Rate

The foreign exchange works like the Stock Exchange. Whenever investors trade in any kind of foreign investment they are dealing in foreign currency. This includes bank deposits, equities, bonds, or property investments. For example, a Scandinavian investor may want to buy shares in an American company. She will pay for the shares in US dollars, which probably means converting Krona to US dollars. A Japanese property investor selling premises in London will have to convert the proceeds from GB pounds to Japanese Yen.

Speculators and investors similarly trade foreign currency directly to benefit from fluctuations in the foreign exchange rate. For example, if a US investor discovers the Japanese economy is becoming stronger, it follows that the value of the Yen will increase (i.e. go up relative to other currencies). The investor would be wise to buy Japanese Yen, taking what is called a long position.

On the other hand, if he sees the Japanese economy in decline, and therefore the value of the Yen liable to decrease over time, he would be wise to sell Japanese Yen – i.e. take the short position. Speculators on the foreign exchange market can actually profit from currencies becoming either stronger or weaker, by taking the long or the short position accordingly.

Traders who speculate on the foreign exchange are generally short term dealers, tracking market activity closely; buying foreign currency and then selling it again within a very short time – sometimes just a few minutes. There are numerous attractions to trading in this way, and such traders keep the market volatile and exciting.

At Pure FX we constantly work to get the best possible currency exchange rates for our customers.

Get a Quote
Feefo service

What Our Clients Say

Read all the reviews at Feefo.com

Why Us

Exceptional Service

We have received Feefo's Gold Trusted Service Award 3 years in a row.

Same Day Transfers

We can transfer your money to your destination bank account the same day you send it, once we’ve confirmed the payment details with you.

Competitive Exchange Rates

Competitive exchange rates and transparent transfer fees, so you know exactly what you’re paying for.

Dedicated Personal Service

To guide you through the transfer process and keep you up-to-date with the changing exchange rates.

Established in 2006

Since then, we’ve transferred money for thousands of satisfied clients.

How It Works

  • 1. Register

    for a no obligation account
  • 2. Agree the exchange rate

    with your account manager over the phone
  • 3. Send us payment

    for the transfer of your purchased currency
  • 4. We transfer the currency

    to your nominated account