To calculate the cross exchange rate, you need the bid prices of both currencies involved when paired with the USD. You just have to multiply the two bid prices with your cross rate calculator to get the cross rate. For example: In the case of the GBP/CHF. The bid prices are as follows: GBP/USD=1.5700, USD/CHF=0.9300.
The idea of cross rates implies two exchange rates with a common currency, which enables you to calculate the exchange rate between the remaining two currencies. For example, you can easily find, say, the euro–dollar or the yen–dollar exchange rates in financial media.
A step-by-step guide to calculating cross rates, which are exchange rates for currency pairs that do not involve the US dollar.
To calculate the cross-rate between the Canadian Dollar (CAD) and the South African Rand (ZAR), using the US Dollar as the common currency. Let us assume
The cross rate is the currency exchange rate between currency A and calculated as the cross rates using the quotes for major currencies.
Cross rates enable currency traders to calculate the exchange rate between two currencies by using a third, common currency.
To calculate the percentage discrepancy, take the difference between the two exchange rates, and divide it by the market exchange rate: 1.12 - 1.0950 = 0.025/1.0950 = 0.023. Multiply by 100 to get the percentage markup: 0.023 x 100 = 2.23%. A markup will also be present if converting U.S. dollars to Canadian dollars.
Currency cross rates are not usually quoted outside of a few Next, determine what type of quote each of your two selected EXAMPLE:.
A brief demonstration on computing the cross rate between currencies.
Calculating currency cross pair rates. http://www.financial-spread-betting.com/ forex/forex