FXplained
How to read an FX quote
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?