Carry Trade [live progress] - Page 2
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Thread: Carry Trade [live progress]

  1. #11
    I wonder if you get better interest rates from buying currency futures where possible

    did you do some research within these stocks and if so what's the difference in interest?

    thanks

  2. #12
    Quote Originally Posted by ;
    I wonder if you get better interest rates from buying currency futures where possible

    did you do any research into these futures and if so what is the difference in interest?

    Thanks
    I actually didn't

    Its a good point however. Marked it . Should you get results, please post here.

    Regards

  3. #13
    Some more information:

    Thus, you could be thinking about, why the equity is negative, actually its been around 2 weeks now?

    Well, the answer is simple: The initial setup price.

    In the time of buying/selling each pair, we needed to pay spread. In the time of the beginning of this portfolio, we've compensated : $6101 in spreads.

    Aiming for $16K ($16245.6 to be exact) in interest, the portfolio has a whopping &6.28 percent yield in one year (at least in theory, until we have the Money from the bank, eh? )

    Well, you may ask, again, why then the portfolio worth even went to $52K the other day? As I mentioned previously, the movements in the currency markets require a few times to flatten out. Thats why. Any gains/losses due to an appreciation or depreciation of a pair in worth should cancel out at the long-run.

    Thus, considering this calculation:

    Initial Cost = $6101
    Interest earned a week 338.45
    Week that the portfolio will be level = 18

    Therefore, we ought to expect the portfolio to become level in value per week 18. Thats. And after that, we'll cash in $338.45 in interest.

    Lets talk about any downsides, ideas, in the path into the carry portfolio.

    Regards

  4. #14
    Day 1:

    We have reserved $9.67 in interest. (Can offer the breakdown later)

    The portfolio equity is currently down about $700-800 because of short-term changes, but this ought to straighten out in the long-run.

    The focus here would be to make the attention day in and day out. At its current rate, the interest alone should add up to $9.67 * 367 = 3520 per year, together with 9 stand lots open. (Currently that is a margin of about $7500 in US, $1875 in UK. Thats around 50% profit for margin in US, and 100% profit in UK, where max leverage is 1:400 for a reputable broker)

    Lets see how it goes

    Its interesting to see the shift from JPY based crosses to AUD, NZD and TRY based crosses.

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