Exotic Currency Pairs

[sindarin]

Exotic currency pairs are those which are very less traded. Only those multinationals which earn money from those countries use forex market to convert the same into local currency. Thus, trading in exotic pairs would be very low. Also, the spreads would be wider. However, there are certain traders who take advantage of overnight call rates and make money by leaving the position open.

Yeah the spreads is really wide, there are some of them that have more than 50 pips spread, for day trading that is really not good, and for me that kind of trading is not even want me motivate to make more profit in forex, but sometimes if you put exotic currency pairs for long time it will give you much return.

 

[jackcm]

Yeah the spreads is really wide, there are some of them that have more than 50 pips spread, for day trading that is really not good, and for me that kind of trading is not even want me motivate to make more profit in forex, but sometimes if you put exotic currency pairs for long time it will give you much return.

I don't like to trade exotic pairs since most brokers charge high spread. I occasionally see an opportunities when I look at AUDJPY or GBPJPY but I'm afraid of trading due to high spread AUDJPY 10 pips and GBPJPY 7 pips.

 

[sindarin]

I don't like to trade exotic pairs since most brokers charge high spread. I occasionally see an opportunities when I look at AUDJPY or GBPJPY but I'm afraid of trading due to high spread AUDJPY 10 pips and GBPJPY 7 pips.

There are other which is worse than that, like GBP/SGD the spread even more than 10 pips, actually some emerging country currency rate will be quite higher if that is pairing with the other emerging countries rate for good. I don't see exotic currency pair as the most profitable business but for longer term trader they can use it as the profitable pairs for them.

 

[Pettyeve]

Trading in exotic currency pairs is not easy for some traders. This is true because these currencies that are not being so popular in the forex market but are paired with the dollar is not easy to understand for a newbie trader, so it is better for the traders that know about it.

 

[Decub]

There are other which is worse than that, like GBP/SGD the spread even more than 10 pips, actually some emerging country currency rate will be quite higher if that is pairing with the other emerging countries rate for good. I don't see exotic currency pair as the most profitable business but for longer term trader they can use it as the profitable pairs for them.

Getting it right with exotic pairs requires more of your knowledge about that country's currency. I know those who still make profit trading in exotic pairs. Usually, he trades in USD/ZAR and really understands it. The major factor to be considered is the person's knowledge of it.

 

[willy]

Just in case few traders may not know what are Exotic currency pairs:

Exotic Currency Pairs

The exotic currency pairs, or the exotics, are the currency pairs that are comprised of the most important currency in the global markets—the U.S. dollar (USD)—crossed with any currency that is not considered a major currency. Exotic currencies—like the Swedish krone (SEK), the South African rand (ZAR), or the Mexican peso (MXN)—are called exotic because they are associated with illiquid currencies that might not be available in a standard trading account.

Exotic currencies are usually lightly traded and have large bid/ask spreads. However, many so-called “exotic”currencies are becoming more popular and more and more investors are trading them.

Take a look at the following list of exotic currency pairs because you may be interested in diversifying your forex portfolio with a few uncorrelated currency pairs:

USD/SEK (U.S. dollar / Swedish krone)
USD/NOK (U.S. dollar / Norwegian krone)
USD/DKK (U.S. dollar / Danish krone)
USD/HKD (U.S. dollar / Hong Kong dollar)
USD/ZAR (U.S. dollar / South African rand)
USD/THB (U.S. dollar / Thai baht)
USD/SGD (U.S. dollar / Singapore dollar)
USD/MXN (U.S. dollar / Mexican peso)

Major Currency Pairs

EUR/USD (Euro / U.S. dollar)
GBP/USD (British pound / U.S. dollar)
USD/CHF (U.S. dollar / Swiss franc)
USD/JPY (U.S. dollar / Japanese yen)
USD/CAD (U.S. dollar / Canadian dollar)
AUD/USD (Australian dollar / U.S. dollar)
NZD/USD (New Zealand dollar / U.S. dollar)

It's the most correct and informative about Exotic Paris. Eduction resource credit to TradeMentor - saxobank.com

this is great explaining from you about the exotic pairs this is the first time for me to understand this pairs like usd/mxn or others but i am trading with eur/jpy i love this currency pairs too much to make profits with my digital strategy

 

[rexway]

there are so many exotic pair but I think its all depend on the trader which is involve and the pair which he like the most for me I trade on EUr/usd this pair is more than exotic to me since I can make good amount of profit with it

 

[kasual]

The pairs called exotic since they are not traded by many traders. Brokers charge high spread and since less traders participate in the pairs, movement very slow and not enabling traders to achieve profit target in short period of time. Than choose to trade in exotic pairs, I am sure many traders prefer to trade in major pairs.

 

[sindarin]

Many kind of exotic pairs that we can traded, the liquidity is not high and the spread is big, i think that is characteristic of Exotic Currency pair and also we can act as market maker with this pair.

 

[barood4money]

We, i don't like to trade with exotic pairs because the spreads are very high. And there are many other good pairs to trade with low spread. Then why to take risk with exotic pairs. Isn't it.? Trading with exotic pairs only preferred for expert traders.

 

[sindarin]

You can become a merkat maker in exotic currency pair rather than low spread currency like EURUSD or USDJPY. Also trading in exotic pair is good for middle to long term, because of the volatility which is high.

 

[Decub]

Yes, because they don't have that much liquidity, it is better to trade in them in a longer term. These pairs could as well be much more profitable than trading even the fast moving pairs but most traders would find it difficult understanding it.

 

[sindarin]

Yes, because they don't have that much liquidity, it is better to trade in them in a longer term. These pairs could as well be much more profitable than trading even the fast moving pairs but most traders would find it difficult understanding it.

But if you ask me to choose between Exotic Pair and Normal/Major Pair i will still choose major pair, with the higher liqudity then the price difference will be lower than before. But exotic sometimes or even often has bigger volatility.

 

[santri]

I don't think so..
The exotic one is more used in trade.

 

[wantus]

I came across these pairs whle checking on the TV news and found that very few people are going to be trading in it. I wonder why? because some of these pairs are local and they do have some benefit for trading in them. they may not be a high earner but surely worth trading for. Have you found exotic currency pairs for your benefit or you don't like trading in them?

I am interested in knowing about them because if the profit is consistent, it would be worth risking in that instead of major currency pairs. like say USD, EUR and others.

 

[wantus]

I came across these pairs whle checking on the TV news and found that very few people are going to be trading in it. I wonder why? because some of these pairs are local and they do have some benefit for trading in them. they may not be a high earner but surely worth trading for. Have you found exotic currency pairs for your benefit or you don't like trading in them?

I am interested in knowing about them because if the profit is consistent, it would be worth risking in that instead of major currency pairs. like say USD, EUR and others.

One of the most promising exotic pairs now is USD/RUB. Because of the geopolitical tensions, ruble was greatly affected by sanctions of EU and USA, and tend to drop more. But spreads on that pair is huge so you have to be 100% sure of your forecast before entering.

 

[sindarin]

One of the most promising exotic pairs now is USD/RUB. Because of the geopolitical tensions, ruble was greatly affected by sanctions of EU and USA, and tend to drop more. But spreads on that pair is huge so you have to be 100% sure of your forecast before entering.

Promising while it is down greatly? I don't think it is promising, i think you should look for USDSGD, the spread is not as high as USDRUB but still has bigger potential of movement. You can use Singaporean index as your own indicator to take profit from minor trend.

 

[budado]

Exotic pairs are not traded much because theirs lack of volume and demand. That's why most traders do trade majors because theirs a volume. I'm sure you don't want to open a position and wait for weeks or months before you can make profit right? In major you can double your money if its goes volatile. While in exotic you need to wait for months before its become volatile.

 

[Decub]

They also seem to be expensive to handle due to their spread. More so, a particular broker a trader likes trading with might not have the pairs he wants to trade in. That is why it seems exotic pairs are not that much on demand within the Forex circle. But then, some who do, still make profits anyway.

 

[budado]

I do hope I can find a forex broker sites that's allows exotic pairs like usd/php. I really do want to trade my own country currencies. Although its not that volatile and its has high spread. I just do feel like its my national honor to trade my own country currency.