Seeking advice on AUD/USD/CAD strategy

F

falcon

Hi,

Would appreciate opinions from the pros on why this strategy would not be such a good idea, as I am very new to this.

I would like to transfer AUDs into USDs to trade the US markets then at a later date (3mths or so in the future) I would transfer those USDs from my trading account into a CADs bank account.

How I see it:

The AUD is histroically quite strong against the USD and the USD historically is quite weak against the CAD, so theres a good chance the USD could strengthen over the next few months against the CAD. I would therefore be in a good position to benefit from this.

How does this look?
 
I was hoping not to get responses from first time posters bearing issues and baggage, but suppose these types of posts attract those type of people.

So I'll try again. I'm not looking to be a trader of forex anything of the sorts & I don't require any BS comments from newbies so if you actually have some constructive cristism in relation to what I proposed I would greatly appreciate hearing from you.

:)
 
you could buy otm put on the usd in case it continues to crater against the AUD and CAD....

while the money is being held in USD only...

But AUD and CAD being so highly correlated, you might want to consider that they are overbought and that the USD may rally.... So why not sell a USD put and buy a USD call... while you anticipate your trade..

AUD => USD --> CAD

OR

you could sell an OTM put on the USD and buy a USD call option if you have enough money to justify such a position in your hedge...
 
ahh the net bring out all sorts.

nemakrua,

Im sorry if my post has caused you to react in such a way as that was not my intention. I am simply asking for opinions and advice from those more knowledgable and experienced than myself in relation to something I have been thinking about.

I have innocently posted hoping to get a discussion going and psytrade responded with an interesting idea which I will now explore, thanks psytrade.

How does you throw away line help me? It does nothing to assist me as it has no substance, why don't you back up your statement with reasoning behind your crude comment.

So I'll try again, what I'm hoping to acheive is constructive critism or suggestions as to how I can best organize my situation.

I wish to send AUDs to Canada in approx 3 or so mths but am happy to leave it in my US trading account to trade with whilst hopefully the USD strengthens against the CAD. T/A tells me that it is quite a good time to convert AUDs to USDs then look to move those USDs to Canada IF it strengthens.

I considered what psytrade posted and could go long a atm USD put to hedge a possible fall in the US, however not too keen on the negative theta. How about going short an otm USD call (at the rate Im happy to sell at), that way I can benefit from a stronger USD & also not lose too much by collecting premium if the USD heads down?

Constructive opinions more than welcome?
 
Quote from falcon:

Hi,

Would appreciate opinions from the pros on why this strategy would not be such a good idea, as I am very new to this.

I would like to transfer AUDs into USDs to trade the US markets then at a later date (3mths or so in the future) I would transfer those USDs from my trading account into a CADs bank account.

How I see it:

The AUD is histroically quite strong against the USD and the USD historically is quite weak against the CAD, so theres a good chance the USD could strengthen over the next few months against the CAD. I would therefore be in a good position to benefit from this.

How does this look?
More...
It looks suitably arbitrary...

What you're trying to do is some a strange and uneasy mix of trading and hedging a fwd fx flow. Hybrids like this never work, in my experience.
 
Quote from falcon:

Hi,

Would appreciate opinions from the pros on why this strategy would not be such a good idea, as I am very new to this.

I would like to transfer AUDs into USDs to trade the US markets then at a later date (3mths or so in the future) I would transfer those USDs from my trading account into a CADs bank account.

How I see it:

The AUD is histroically quite strong against the USD and the USD historically is quite weak against the CAD, so theres a good chance the USD could strengthen over the next few months against the CAD. I would therefore be in a good position to benefit from this.

How does this look?
More...

I think what you are referring to was pair trading in spot fx where you sell AUDUSD, meaning the same as buy USD and sell AUD...and then later on you'd buy USDCAD or buy USD and sell CAD.

you can find out more information from most fx web sites and fx brokers on those trade strategies.
 
nemakrua,

oohh.. more brazzen empty hollow statements with no depth...yawn..

for those who have responded thankyou, will consider all my options :)

If anyone else has any thoughts on why statement below won't work, please explain it to me (Im just an internet noob)

How about going short an otm USD call (at the rate Im happy to sell at), that way I can benefit from a stronger USD & also not lose too much by collecting premium if the USD heads down?

Thanks,

Falcon
 
Quote from falcon:


How about going short an otm USD call (at the rate Im happy to sell at), that way I can benefit from a stronger USD & also not lose too much by collecting premium if the USD heads down?

Thanks,

Falcon
More...
Do you have a view on vol? Otherwise, can you handle MTM pain, whatever scenario transpires?

Why would you want to run a position where you're running risk you're not familiar/comfortable with?

Why don't you just hedge whatever it is you're trying to hedge using fwds and be done with it?
 
Martinghoul,

Was thinking options might be a better way to hedge whilst possibly earning some premium. Just generating ideas atm, think hedging with a fwd might be my end result.
 
Quote from falcon:

Martinghoul,

Was thinking options might be a better way to hedge whilst possibly earning some premium. Just generating ideas atm, think hedging with a fwd might be my end result.
More...
As I mentioned before, I don't like mixing hedging with speculation, which is why I have a problem with the things you're suggesting.
 
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