long RMB at Oanda

R

richardyu301

I would like to short USD/CNY (ie, long RMB) at Oanda. But I am curious about how much interest rate I need to pay.

http://fxtrade.oanda.com/tools/statistical_information/oanda_interest_rates.shtml

Above link suggests that today's interests are:
i) Chinese RMB... bid: -12, offer: -11 (pls note the -ve signs for both bid and offer)
ii) USD... bid: 2.4, offer: 2.95

Why are there negative signs for both bid and offer for RMB???? Does it mean that no matter I buy or sell I need to pay >10% margin??? It is strange as most of time we should get interest if I buy a currency.

Is it b'coz RMB is not easily available so they need to borrow from somewhere else?

Anyone can give me some insights?
 
no free lunch here. carrying that position will cost about -15%, market is already pricing in appreciation. the free lunch comes by going long USD/CYN getting paid 13.3% then hedging this by opening a bank account there. its a synthetic USD money market fund that pays a lot
 
Quote from Daal:

no free lunch here. carrying that position will cost about -15%, market is already pricing in appreciation. the free lunch comes by going long USD/CYN getting paid 13.3% then hedging this by opening a bank account there. its a synthetic USD money market fund that pays a lot
More...

this is indeed a juicy, low-risk strategy.
 
You must log in or register to reply here.
Back
Top