It is viable you take those money as remittance, or TT the money to there (provided you got account there).

If just for travelling purposes, then not much money needed, so it might not suitable as well.

As this is more suit to someone need some significant of money like study abroad which might need few ten K or so, needing the money for business, or got account at there for saving or whatever purposes etc apart from one the of main purposes of this kind of FD for diversification one's asset into other currencies form.

ZAR has lost almost half its value since 5 years ago against USD.

So it is pretty high risk currency compared to AUD and NZD. While AUD just back to its 5 years ago level.


South Africa inflation rate is pretty high, which is not good for the currency, that's why it needs to offer high interest rate.

Don't mean which is good or not good. Just a comparison of risk involved. In foreign currency FD, currency strength is one of the very important factor to be considered besides interest rate factor.


Chart quoted from Yahoo finance.




Attached thumbnail(s)

Now BOE has slashed rate to 1.0% already last week or so. So no possible for others to give 2% anymore.

Already said mah, quoted from Yahoo finance.

GBP fundamental is the weakest among all the major currencies, that's why it fall so much.

It is called DCI or some called pairing which become more and more popular now.

A lot of currency choice from AUD (the most popular) to NZD, GBP, Euro, etc.

You can do MYR -> GBP or GBP -> MYR (provided you have GBP on hand now).

Strike rate is based on spot rate +/- how many basic point to wish, the more +/-, the less interest will be given. While tenure range from 1 week, 2 weeks, 1 months even 3 months.

Once converted, your money will be deposited in the account as GBP, not RM anymore.

But you can do DCI for your GBP to convert to RM, which the strike rate issue applied again.

You must ensure the your target DCI pairing currency is strong one, so that even converted, you still stand a chance for currency appreciation side.

The one the most risky target now is USD, which is keep on sliding to new record level, due to ongoing economy problem of US as well as monetory issue.

I would say for if fundamental nothing change, don't do pairing in USD.

AUD is the bullish one at the moment and carry higher interest rate (3% for AUD FD).

Just my 2 cents.

This is carry trade, it is not risk free.

You forget to add on
c) if Yen appreciate against AUD, you loss the capital as net interest gain might not able to cover the capital loss.

A lot of this kind investors get burn previously using Yen-Aud for carry trade before the 2008 crisis unfold. As that time, Yen interest is like 0.5%, while AUD interst is 7%, so the diffence is so much prompt a lot of investors borrow Yen to invest in Aud, but after the financial crisis unfold, Yen surged to the roof against Aud, so you have to pay back even more which extra interest earned might not able to cover the capital loss.

Borrow Yen is very risky, because Japan keep on having high surplus of trade, if really want to play this game, it is better to borrow USD (which sink like no tomorrow, even some media commentator joke it is US Peso, not US dollar anymore )

At time being, AUD seems the better option.

There is not single currency to be classified as best selection.

When invested or diversify into another currency, the primary concern is about the health of economy of the particualr country.
The so called good option can change from time to time.

At time being, Australia economy seems quite ok and with commodities price seems firmer, as one of the most important commodities exporter in the world, AUD prospect is ok while with interest differentiate (4% current and expect to go up a few more basic point in the future), one earns more through AUD.

AUD is seems as a risky trade currency by the market, so when any crisis unfold, investors will flock to USD and dump AUD.

One good about AUD is that RBA is quite hawkish in general. When invested in a currency, you want the particular central bank to be the one pro-active to maintain the value of the currency, not the one hoping currency to depreciate to boost export.

Having said that, AUD is staying at elevated level at time being.
At 0.93 AUD/USD is a big resistance level.

Local banks almost all do have foreign currency account/FD, so this is the simplest way as starting point, instead of potential hassle to open account in overseas.

The one that look interesting is AUD, not GBP in my opinion.
Tomorrow may drop below 2.70 against RM.

At least AUD has the highest interest rate compared to all major currencies.

Yes, can, when sum is big enough, can always ask for -100 to 150 points lower than the board rate, which they generally can give one but it depends on bank also, some do, some don;t.

DCI has pairing.

For eg. RM-AUD

DCI has 1 week 2 week or 1 month, tenure depended on banks offer or customer request as well. It will cease after the period.
Current spot rate of RM-AUD is 2.73.
your strike price could be 2.73 or 2.72 (spot - 100 pips), or 2.71 as well

For illustration
2.73 - 30%
2.72 - 20%
2.71 - 10%

Above is the offer of interest rate given with strike price based on 1 week tenure (can be 2 week or 1 month as well), but shorter duration, they give better rate. Interest rate given is differ each day depended on the volatility of forex market, last week, when there is severe move in currency market, there is once DCI carried 70% as well.

Let say you decide to go in 2.73 - 30%
After 1 week, if the spot rate of RM-AUD is 2.74, then your RM won't be converted to AUD, but you will get 30% pa interest rate on your invested money.
If the spot rate is below the strike price of 2.73, your RM will be converted to AUD at 2.73, with together the 30% pa interest rate.

Based currency can be both way i.e. RM or AUD.
As if the money is converted to AUD, you could do the reverse aka base currency of AUD-RM DCI as well.

NZD normally correlated to AUD.

I would rather diversify in AUD instead all eggs in NZD.
AUD fundamental is stronger than NZD.

Interest rate for AUD and NZD is expected to rise further if economy does recover, so too long term commitment is not advisable. Just my opinion, I could be wrong.

None of move will reduce currency risk, it is nature of it and depended on one's risk appetite and comfortable level.
Even we holding RM, we still have currency risk on RM, whereby RM can appreciate/depreciate against others major currency.

You look at wrong aspect already if you want to invest.

For currency issue.
Several key factor we need to look at

1. Economy situation aka growth
2. Trade surplus/deficit
3. Gov surplus/deficit.
4. Strength of economy, size of economy.

AUD is actually more stable than NZ in vs RM
AUD is one of six major traded currencies in the world, while NZD is not.

While Australia has strength in resources, world major iron ore supply, as well as agriculture export.

You need to assess the situation yourself, there is no such thing of best option.
Every move come with its own risk.

Average benchmark for NZD also 2.0-2.2
If AUD going down to 2.5, then 95% of chance NZD will also go down together. Both currency have strong correlationship.

Sometimes we cannot look back what is the rate in the old day, to say what level is cheap or expensive, things change.

Nobody will know which currency will go down or go up in the future.
Fundamental of particular country dictate the strength of it, which can change over time.

Yup, AUD is extreme volatile, but fundamentally, its currency is indeed much much better than the rest like GBP, USD.

High or not high is a billion dollar question, that nobody knows.

Back few years ago, when RM3.80 vs USD, nobody even dare to predict it will be Rm3.00.
If RM surge another 10%, it is back to pre-1997 crisis.

Back then just after the crisis when Rm4.00 vs USD, if you told someone RM will be back to RM2.70~2.80 one day, it is like a joke. But now, it is not.

There is no such thing UT, bond fund or which is better than foreign currency or not.

The risk undertaken is different to start with.

UT, you stand a chance to lose your initial capital.
Yes, there are many UT gain quite handsome over the long term, but at the same time, there are UT that make you a loss (I had seen a number of fund registered 30% loss) even after 3-5 years as well.

While for foreign currency FD, if you put SGD 10k, it will remain SGD 10k, you won't lose a single cent in SGD.

No.

For foreign currency deposit or foreign FD deposit, the "money" needs to be in "digital" form, not physical.

Either the foreign currency come from exchange with the bank, foreign currency bank draft or being TT from elsewhere.