Personal foreign exchange trading, also known as foreign exchange treasure, refers to the trading behavior of individuals entrusting banks to buy and sell one foreign currency into another with reference to the real-time exchange rate in the international foreign exchange market. Because investors must hold enough foreign currency to trade, the internationally popular foreign exchange margin trading lacks the short selling mechanism and financing leverage mechanism of margin trading, so it is also called firm trading. Personal foreign exchange transactions are generally divided into firm offer and false offer (margin).
Through foreign exchange transactions, individuals can sell their foreign currency and buy another foreign currency with a higher deposit interest rate or appreciation, so as to obtain higher interest income or gains from foreign exchange appreciation and avoid exchange rate risks. If you buy a currency with a higher interest rate and it is appreciating, then you can benefit from the exchange difference and interest. Through foreign exchange trading, individuals can also adjust the currency structure of foreign exchange in their hands, which is not only convenient to use, but also conducive to maintaining value.
At present, according to the relevant national policies and regulations, only firm foreign exchange trading can be carried out, and false foreign exchange trading cannot be carried out. Therefore, personal foreign exchange trading belongs to firm trading (overdraft, margin and other transactions are not allowed), and individuals conduct firm foreign exchange trading through counter service personnel or other electronic financial services within the trading time specified by the bank.
Entrusted by customers, the Bank converts one foreign currency into another according to the quotation of its personal foreign exchange trading business. At present, RMB is not fully convertible, and RMB and foreign exchange are not freely traded. Individual residents can open an account in a bank with cash, or transfer their existing cash account deposits to a bank that provides personal foreign exchange trading business. In terms of transaction means, you can go to the bank counter to handle transactions, or you can buy and sell foreign exchange by telephone or online.
References:
Baidu encyclopedia personal foreign exchange transaction