"SEMBCORP MARINE (SCMN.SI) - Sembcorp Marine said on Wednesday it had agreed with BNP Paribas to settle a $50.7 million dispute stemming from botched foreign currency trades at its Singapore unit last year. Sembcorp said in a statement it would take a charge of about $30 million in the fourth quarter following the settlement. "
How many times have we read about huge foreign exchange trade losses incurred by companies who need to hedge against foreign exchange fluctuations, given that many receive revenues denominated in USD against costs which are often in SGD?
So, when even these big boys incur huge losses, with all the so-called expertise and resources at their disposal, what makes us, the small retail investors, think that we can do better than them and reap huge financial rewards and gain financial freedom, as claimed by so many advertisements by self-professed gurus (some with dubious doctorates bought from unaccredited universities)?
If it's so easy, why don't these gurus offer their expertise and simple winning formulas to the big companies and earn big time, and at the same time benefit our stock markets, so that for once, we read about huge foreign exchange gains instead of losses?
My advice therefore to all my friend and clients is to stay away from foreign exchange trading.
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2 comments:
Well,as in all forms of risky ventures -- there are some winners but many losers.
Unsurprisingly,we also get to read only about the lucky few who made money.In FX trading,the speed by which gains or losses could be realised is thrilling.
Many,after attending a few short lessons,started dabbling.A close friend of mine did and eventually got hooked and lost a large sum.
"Fish see the bait,but not the hook;men see the profit,but not the peril"
I couldn't agree more. In the same category is futures trading. Nick Leeson should know.
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