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kevin97531 · 30-06-2006, 10:08

My broker doesn't offer all of the currency pairs that I would like. I thought that I could "create" pairs by trading two that I already had.

For instance, I thought that in order to create a long position in EUR/NZD, I could go long EUR/USD and short NZD/USD. This way I am long EUR and short NZD, but I am also both long and short USD which should cancel out. I tested my theory overnight and found that the combination of the EUR/USD and NZD/USD made money while the EUR/NZD position lost money. (This is after factoring in losses for spreads). Where is my logic wrong? Is there a way "create" currency pairs with USD crosses?

30-06-2006, 10:08	#1
kevin97531 level 1 Join Date: Mar 2005 Posts: 3 Downloads: 0 Uploads: 0 Rep Power: 0	Currency pairs My broker doesn't offer all of the currency pairs that I would like. I thought that I could "create" pairs by trading two that I already had. For instance, I thought that in order to create a long position in EUR/NZD, I could go long EUR/USD and short NZD/USD. This way I am long EUR and short NZD, but I am also both long and short USD which should cancel out. I tested my theory overnight and found that the combination of the EUR/USD and NZD/USD made money while the EUR/NZD position lost money. (This is after factoring in losses for spreads). Where is my logic wrong? Is there a way "create" currency pairs with USD crosses?