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Author Topic: Staking - exchange rate niceties.  (Read 4477 times)
tikay
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« on: October 18, 2011, 09:32:41 AM »


Dom, aka "Nico29" - has a staking Thread up.

He has PM'd me for advice, but I don't know the correct answer - can anyone assist, please? I'm asking on his behalf as it is urgent, & Dom is currently Offline.

He wants to "be right" by both parties.

Here is his question to me.....

"....I've found a very decent exchange place in london which doesn't charge commision and gives $1.565 per £.

However i'm new to this kind of thing with staking as i've never done one abroad before.

I'd like to ask your advice, is it my responsibilty to take the hit on the exchange here?

Just thought you'd be more experienced of the 'done' thing in such a case.

I haven't pm'd anyone yet on this as i'd like to know exactly what to charge.

Basically according to expedia/x.e the exchange rate is $1.58 to the pound.

Therefore in our case for example if i buy at the set rate i'll be charged £895.

However if i quote you the internet rate of 1.58 dollars to the pound it will be £886.

I know it's only £9, i guess i just wondered as if i sell 65% i'll be hit for nearer £60.

Also i'm worried in case the shop rate changes drastically and i lose double that amount or something.

I don't mind either way i'd just like to know the done thing. Smiley
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« Reply #1 on: October 18, 2011, 09:44:07 AM »

Staking thread is in $ so it is peoples responsibility to ensure Dom receives that exact amount in $, and in the same way they get paid any winnings in $ and it is up to them to take the hit.

Dom can obv help with exchanges but I dont think he should be out of pocket as the staking prices are clearly in $ and prizes will be paid in $

 
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« Reply #2 on: October 18, 2011, 09:50:31 AM »

Staking thread is in $ so it is peoples responsibility to ensure Dom receives that exact amount in $, and in the same way they get paid any winnings in $ and it is up to them to take the hit.

Dom can obv help with exchanges but I dont think he should be out of pocket as the staking prices are clearly in $ and prizes will be paid in $


Although this is technically correct, I have no doubt that I'd suck up £60 for people who parted with money to show faith in me in pursuit of a return. Bit like asking whether you should tip after receiving  good service. You don't have to but it feels good to
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« Reply #3 on: October 18, 2011, 10:17:33 AM »

The "internet rate" isn't an available rate (unless you are a bank trading inter-bank for zzillions or you are trading with mates coming back from USA and want to get a fair price)

$1.565 is a decent rate today.

IMO, it's one more thing to get right with the staking request at the time of the request.  Either ask people to give physical dollars, or ask for sufficient ££ to be able to convert into $$ at the rate which is actually available.  At that point, the horse does accept some currency fluctuation,(removed if they actually buy the $$ that day at that rate)  but that can move for or against them and isn't going to be very much in any case.

Likewise (as I asked Dom in his thread) it is fine to agree up front what the procedure will be for dollars on the return leg.

I don't think it is fair for a backer to ship "whatever it says on xe.com" as Dom doesn't have a fair shout of turning it into that many real dollars.

That said, if someone is charging a premium, they could stipulate where appropriate if the vig is to cover perceived edge, travel costs, currency costs or whatever.


Cliffs:  Dom should fix the exchange rate (1.565) and make sure people have sent him enough  ££ at that rate.  On the return leg, Dom should offer players the choice of $$ on collection, or at an exchange rate available at that time.
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« Reply #4 on: October 18, 2011, 10:43:43 AM »

The "internet rate" isn't an available rate (unless you are a bank trading inter-bank for zzillions or you are trading with mates coming back from USA and want to get a fair price)

$1.565 is a decent rate today.

IMO, it's one more thing to get right with the staking request at the time of the request.  Either ask people to give physical dollars, or ask for sufficient ££ to be able to convert into $$ at the rate which is actually available.  At that point, the horse does accept some currency fluctuation,(removed if they actually buy the $$ that day at that rate)  but that can move for or against them and isn't going to be very much in any case.

Likewise (as I asked Dom in his thread) it is fine to agree up front what the procedure will be for dollars on the return leg.

I don't think it is fair for a backer to ship "whatever it says on xe.com" as Dom doesn't have a fair shout of turning it into that many real dollars.

That said, if someone is charging a premium, they could stipulate where appropriate if the vig is to cover perceived edge, travel costs, currency costs or whatever.


Cliffs:  Dom should fix the exchange rate (1.565) and make sure people have sent him enough  ££ at that rate.  On the return leg, Dom should offer players the choice of $$ on collection, or at an exchange rate available at that time.

agree
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« Reply #5 on: October 18, 2011, 10:51:18 AM »

Agree with Dom fixing the rate at what he can get.

Dom, it might be worth checking these guys out, maybe they can do a bit better... (I'm assuming you're collecting in London)

http://www.iceplc.com/cgi-bin/live/ecommerce.pl?site=iceplc.com&state=survey&action=display&survey=10&menu=branchcollection&suppress_header=yes&zone=waterloo
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« Reply #6 on: October 18, 2011, 01:34:52 PM »

I had a look on 2p2 staking forums and from what I could tell, the horse locked in the rate when they made their OP (or in this case, when Dom confirmed), and provided amounts in $ and £. They all generally used xe.com rates.

The other factor that I noticed mainly was that the exchange rate was fixed for both payments and winnings so that if Dom set the exchange rate at 1.565 when we paid, then we would get $1.565 to £1 in November, whether the rate then was $1.525 or $1.625.

Am happy to accept whatever rate Dom sets (naturally assuming he wont take the proverbial) but that rate should be locked in for payouts as well should Dom bink.
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« Reply #7 on: October 18, 2011, 01:38:10 PM »

I had a look on 2p2 staking forums and from what I could tell, the horse locked in the rate when they made their OP (or in this case, when Dom confirmed), and provided amounts in $ and £. They all generally used xe.com rates.

The other factor that I noticed mainly was that the exchange rate was fixed for both payments and winnings so that if Dom set the exchange rate at 1.565 when we paid, then we would get $1.565 to £1 in November, whether the rate then was $1.525 or $1.625.

Am happy to accept whatever rate Dom sets (naturally assuming he wont take the proverbial) but that rate should be locked in for payouts as well should Dom bink.

Absolute balls, and ridiculous beyond my comprehension
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« Reply #8 on: October 18, 2011, 01:51:47 PM »

I had a look on 2p2 staking forums and from what I could tell, the horse locked in the rate when they made their OP (or in this case, when Dom confirmed), and provided amounts in $ and £. They all generally used xe.com rates.

The other factor that I noticed mainly was that the exchange rate was fixed for both payments and winnings so that if Dom set the exchange rate at 1.565 when we paid, then we would get $1.565 to £1 in November, whether the rate then was $1.525 or $1.625.

Am happy to accept whatever rate Dom sets (naturally assuming he wont take the proverbial) but that rate should be locked in for payouts as well should Dom bink.

Absolute balls, and ridiculous beyond my comprehension

Why?

It protects both horse and staker dependent on the global markets.
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« Reply #9 on: October 18, 2011, 02:01:27 PM »

I had a look on 2p2 staking forums and from what I could tell, the horse locked in the rate when they made their OP (or in this case, when Dom confirmed), and provided amounts in $ and £. They all generally used xe.com rates.

The other factor that I noticed mainly was that the exchange rate was fixed for both payments and winnings so that if Dom set the exchange rate at 1.565 when we paid, then we would get $1.565 to £1 in November, whether the rate then was $1.525 or $1.625.

Am happy to accept whatever rate Dom sets (naturally assuming he wont take the proverbial) but that rate should be locked in for payouts as well should Dom bink.

Absolute balls, and ridiculous beyond my comprehension

Why?

It protects both horse and staker dependent on the global markets.

Unless I have misread it it only protects the staker.

Dom takes payments at 1.54 and goes to play a $1.54 tourney, when he plays the exchange rate is 1.54, he wins the lot wiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii $154
Gets home and has the bad news that the rate is now 154 so he changes his $154 for a pound coin and has to pay they guy who staked him the £1 in the first place £100
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« Reply #10 on: October 18, 2011, 02:12:08 PM »

I think you might have misread it.

Horse has a package valued at $10,000. 1%=$100.

When staker buys 1% rate is 1.54 - his cost is £64.94.

Package ends 4 weeks later. Exchange rate is now 1.64. Horse has $50,000 to share. 1% is now $500. Staker wins 5 times his buy in, which is £324.70.

However, at new exchange rate, $500/1.64=£304.87. Despite staker winning 5 times his buy in, he loses ~£20. Horse gains that £20.

However, should the exchange rate be 1.44, that $500 would now be worth £347.22. Staker gains £22.52 (£347.22-(£64.94*5)) which Horse has to pay out of their winnings.
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« Reply #11 on: October 18, 2011, 03:16:41 PM »

I think you might have misread it.

Horse has a package valued at $10,000. 1%=$100.

When staker buys 1% rate is 1.54 - his cost is £64.94.

Package ends 4 weeks later. Exchange rate is now 1.64. Horse has $50,000 to share. 1% is now $500. Staker wins 5 times his buy in, which is £324.70.

However, at new exchange rate, $500/1.64=£304.87. Despite staker winning 5 times his buy in, he loses ~£20. Horse gains that £20.

However, should the exchange rate be 1.44, that $500 would now be worth £347.22. Staker gains £22.52 (£347.22-(£64.94*5)) which Horse has to pay out of their winnings.

Lol I see what you meant, i thought you meant it was fixed at one rate for buying and returning, what you meant was it is a fixed rate for buying then another fixed rate for returning Smiley
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« Reply #12 on: October 18, 2011, 03:35:19 PM »

Yeah, that was what I meant. x.xx for buying then same rate on return.
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« Reply #13 on: October 18, 2011, 03:44:38 PM »

Yeah, that was what I meant. x.xx for buying then same rate on return.

I am defo having a thick day, so in your example above which payment amount are you advocating as fair?
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« Reply #14 on: October 18, 2011, 03:46:43 PM »

The one where both parties agree the same rate for both transactions.
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