WTF is this !!>! FX

Is it me, is it me, am i insane? am i missing something FOrex Section LOS 18.e: It says: Consider a 6 month forward exchange rate quote from a US currency dealer of 1.63843-1.64073 USD/GBP. This means the dealer will commit to buy GBP for 1.63843 dollars in six months […] Then this is follow by this example: Assume that the USD/GBP 6 month forward rate is quoted at a bid of 1.63843 and ask of 1.64073. From the perspective of a US currency dealer, calculate the bid ask spread. Answer: 1.64073-1.63843. wtf…am i reading something wrong or is there a direct ocntradiction?

I think you’re reading something wrong. In fact, I don’t even understand the question.

thank you, that answers it

Yes, I find that my lack of understanding is always helpful. In fact, I have made my best contributions when I just stand there and look stupid.

well thank you for the does of sarcasm… Just re-read what i wrote, then youll notice that both scenarios are identical (in terms of bid-ask, and in terms of perspective. i.e.: US dealer perspective), but for one the bid-ask is inverted. look at the los, and the example right after

i think you need to chill out and get a sense of humour

I think they just want the absolute value… .0023 which is the spread. Weird that they did that though. Hope that’s right.

The quote was intended for the buyer, The Bid-Ask will be switched if seen through the perspective of the dealer.

But does that mean that the dealer will buy at a higher price than his ask?

Dealer will buy at what he quoted the Bid at.

I don’t see anything wrong with it . First of all no matter how you look at it a spread is a spread. Second the dealer quotes so he will buy at bid and sell at ask

nobody ansered anything. Its clearly a typo on Schweser side…

I dont see the typo…

How is it a typo? Obviously you don’t understand the question urymoto1. In the first example it says “consider a forward exchange rate quote…” meaning that you are a buyer considering the bid/ask quote of 1.63843-1.64073 USD/GBP. Obviously, you would buy at the ask, 1.64073, and sell at the bid, 1.63843. If you were to sell at the bid, than the dealer would be obligated to buy at the bid… In the second example, it asks you to calculate the spread from the dealer’s perspective. Obviously, the spread would be positive since that is how the dealer makes money. lets run through this one more time: example #1: bid/ask “QUOTE” = 1.63843 - 1.64073 USD/GBP example #2: Dealers “SPREAD” = 1.64073 - 1.63843 = .0023.

It seems like the confusion here is over “-” as a dash and “-” as a minus sign.

motherfuc.ker. I lost it there. i knew i was dumb from looking at it too long. I understood that the 1.64073-1.63843 was the dealers bid-ask. That made no sense. now i see they were just trying to calculate the spread. its tool time!!!