FXplained
How to read an FX quote
To read an FX quote, check six things: the exchange rate against the mid-market rate, whether it's indicative or guaranteed, separate fees, the value date, how long the rate is valid and the totals. The total paid and the amount received are what really matter.
FX quotes are built to be skimmed, not scrutinised. Here's what to actually look for.
1. The exchange rate
This is the headline number – but on its own, it tells you nothing. A rate is only meaningful compared to the mid-market rate at the same moment. Always check both together.
2. The rate type
Is this a live, guaranteed rate, or an indicative one that could move before you transact? Indicative rates can shift in the provider's favour between quote and execution.
3. Fees, separately listed
Look for a breakdown: transfer fee, receiving fee, any intermediary charges. If a quote just shows "no fees," the cost hasn't disappeared – it's very likely folded into the rate.
4. The value date
When will the funds actually arrive? Same-day, next-day, and multi-day settlement can carry different pricing, and delays matter if you're paying a supplier against a deadline.
5. Rate validity
How long is this rate held for? A quote that expires in 30 seconds gives you no time to compare it against anything — which may be the point.
6. Total amount payable and total amount received
The two numbers that actually matter. Everything above exists to help you sense-check these against the mid-market rate – not to be read in isolation.
A simple checklist before you accept any quote
- □What's the mid-market rate right now?
- □What's my percentage margin above it?
- □Are there separate fees, and who pays them?
- □Is this rate locked, and for how long?
- □What will actually land in the recipient's account?
Frequently Asked Questions
What information should an FX quote contain?
Check the currency pair and direction, exchange rate, whether the rate is indicative or guaranteed, any fees, the quote’s validity and the value date. Confirm both the total amount payable and the amount the recipient should receive.
How do I check an FX quote’s exchange-rate margin?
Compare the quoted rate with the mid-market rate for the same currency pair, direction and time. The difference helps identify the exchange-rate margin, but you must also account for any separate charges when comparing the total cost.
What is the difference between an indicative and a guaranteed FX rate?
An indicative rate is an estimate that may change before you transact. A guaranteed quote offers a rate under stated conditions and for a specified period. Confirm the expiry time and any conditions with the provider before accepting it.
What is a value date?
It's the date the currencies actually settle – when your money leaves and the recipient's arrives. Same-day, next-day and two-day settlement can be priced differently.
Why does my quote expire so quickly?
Exchange rates move constantly, so providers only hold a price for a short time. A very short window also makes comparison harder, so ask for enough time to check it.
What's the difference between the amount payable and the amount received?
The amount payable is what leaves your account, including fees. The amount received is what lands with the recipient after any deductions. Compare both.