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Originally Posted by vankatav2003
there is almost no way you can lose any money using this strategy
Lets say you have $1.28m USD now which is equal to 1M EUR
If you believe the EUR/USD is going up you go ahead and you buy 1M units EUR/USD at 1.28
If the EUR/USD goes up lets say 100 points you have just made $10 000 on this trade, you close the trade and you have 1.29M USD now.
IF the trade goes in the opposite way and you lose lets say 500 points, then you will have 1.28m - 0.05M = $1.23M
But then you will still have 1M EUR which at that time will cost 1.23
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Surely that's a loss isn't it? Your euro originally cost you $1.28, they're now worth $1.23. Apart from that there's the loss of interest, Euro is at 2.75% and Dollar at 5.25%
Have I missed something obvious?
Mick