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What is the cheapest way to exchange a large amount (7 figures) of euros into Swiss francs? The euros are held at a bank which uses average exchange rates (currently 1.167800 at Postfinance). Would I get a better rate by trading forex with Swissquote? What is your opinion?
Thank you very much for your help!
Hi there,
When you trade forex with a securities broker, you do not normally buy actual foreign currency, but simply bet on fluctuations in the exchange rates of currency pairs. This is normally accomplished through contracts (CFDs for example).
Like other bank accounts, brokerage accounts are denominated by a single currency. The exchange rates used by Swiss broker banks for exchanging actual are not necessarily more favorable than those used by other broker banks.
Currency brokers and peer to peer currency exchange platforms provide an alternative to banks and can often be a more affordable currency exchange option. The comparison service Monito allows you to compare a variety of different currency transfer/exchange options. It is also worth noting that many banks and other currency exchange service providers are willing to negotiate special rates for large currency purchases (7-figure sums, for example).
moneyland.ch is currently conducting exhaustive research to determine the currency exchange rates used by Swiss banks for different types of currency exchanges. The results of this research will be released shortly.
Best regards from Moneyguru
More on this topic:
Peer to peer currency exchange explained
Foreign currency accounts at Swiss banks explained
>What is the cheapest way to exchange a large amount (7 figures) of euros into Swiss francs?
Interactive Brokers.
Or call your bank and press them hard into giving you a good spread. Not the exchange rate itself - understand that the bank can't control it, and in the price spectrum you're looking at they cannot afford to take the risk of fixing it for you for more than a few moments. You're only going to be able to negotiate the spread they charge you from the market rate. Works with some banks. I've heard from a colleaugue PF gives 5bp spread over the phone. It's not as good as IB, but shockingly good for a swiss bank!
> Would I get a better rate by trading forex with Swissquote?
Nope, their default spread for currency exchange is about 1%. But you can try calling them. The low, single-digit pip spreads they advertise in the big print are for CFD trading only, i.e speculation on the rate, not a vanilla currency conversion.
Hi there,
moneyland.ch has completed its study of exchange rate spreads used by Swiss banks. You can request a PDF table which list the exchange rate spreads for banknote rates and forex rates used by Swiss banks here:
Swiss Bank Currency Exchange Rate Comparison
You can request a PDF table showing which rate (banknote rate or forex rate) Swiss banks use for different kinds of transactions here:
Banknote Rates and Forex Rates in Switzerland
Best regards from Moneyguru
informative. thanks for the reply
