I've been denied entry to Thailand - Now What ! ?

[webfact]

GURU SPEAK

Thailand's first currency futures set to launch

Kesara Manchusree

BANGKOK: -- The Thailand Futures Exchange (TFEX) plans to launch US dollar futures as another effective tool for investment this year.

With the fluctuating exchange rate affecting the Thai economy in both the real and the financial sector, dollar futures will served as a hedging tool against foreign-exchange (FX) risk. This tool stands to benefit not only exporters and importers but also investors who want to diversify their portfolios in foreign assets.

Dollar futures is a contract to exchange dollars for baht at a specified future date and at a rate fixed on day of purchase. Each contract has a value of US$1,000, which is considered a small contract for an exporter or importer seeking to hedge risk.

Initially, the maximum position for each client will be $5 million, or 5,000 contracts. Dollar future contracts offer four different lengths of maturity: the three nearest consecutive months and the next quarterly month.

The price is quoted in terms of baht per one US dollar, with minimum price movement at Bt0.01 (Bt10 per contract). The contract is cash-settled, which means no physical dollars delivered on the expiration date. Moreover, investors receive or have to pay (depending on gain or loss) in cash. On the last trading day, expiring contracts will be settled at 11am. The final settlement price is based on the US$/Bt rate recorded by Thomson Reuters at 11am. The rate is derived from the best bid and offer quoted by about 20 Thai and foreign contributing banks.

Dollar future contracts will be available to every Thailand resident. The trading method is as simple as stock trading - a trading account with a TFEX broker is all that is needed. Investors can submit their orders by telephone or online. Up-to-date online trading prices and data are easily accessed via smart phones, laptops and other Net-friendly devices.

Business owners will find dollar futures a simple way to hedge against FX movement. Importers worried about possible depreciation of the baht can take a long position and effectively freeze the exchange rate at the current futures price. On the other hand, exporters can "short" dollar futures to hedge against risk of baht appreciation.

Dollar futures provide a two-sided trading opportunity, for both weak and strong exchange rates. With a low level of capital, investors gain a large degree of trading leverage. Those who invest in gold futures, silver futures, oil futures or foreign mutual funds can also use dollar futures to hedge their exposure to exchange rate risk.

We believe that exchange-rate risk will become an important factor in our foreign trading and investment. Dollar futures will be launched this year as one of the instruments enabling Thailand residents to manage their exchange risk. For more information, visit www.tfex.co.th www.tfex.co.th

TFEX presently offers equities products comprising SET50 Index futures/Options and single stock futures, as well as commodities products including futures in gold, silver and oil, and the interest rate products THBFIX/BIBOR/five-year govt bond futures.

Kesara Manchusree is managing director of the Thailand Futures Exchange.

-- The Nation 2012-04-20

[Pib]

I'm going to make some of my in-laws aware of this as they recently got their daily wage raised to 300 baht and just may want to trade some currency futures with their extra money.

[keeniau96]

Good for serious users eg. ex-im. But you will see the punters jump aboard this as another moneymaker. At Cargill we had a favorite quote:

"It's easy to make a small fortune in futures trading. Just start with a large one."

[mayday49]

Naked puts and calls...........who is publishing the listing and getting EXPERT GUIDENCE may be advised................." the man" is waitin' for YOU.........

[belg]

yeah, the world economy is in the toilet and the last baht's you own will be flushed down with gambling on the SET

[4evermaat]

This is interesting news. I wonder how CME forex will respond to this? Typically they only deal with the majors and crosspairs, and I think it is progressive move on thailands part to open up such speculation on its currency. Will some of their neigbors follow suit?

[PoodMaiDai]

"Going to make it available to Thai citizens"

Are they serious? Why? So they can lose what little money they don't have already? As if any of them even understand currency trading to begin with. There are probably less than 100 Thais in the entire country who do, and they trade abroad already.

Besides, why trade currency when you can play cards and the lotto?

[4evermaat]

"Going to make it available to Thai citizens"

Are they serious? Why? So they can lose what little money they don't have already? As if any of them even understand currency trading to begin with. There are probably less than 100 Thais in the entire country who do, and they trade abroad already.

Besides, why trade currency when you can play cards and the lotto?

Transparency that the futures markets can provide. It's commendable that Thai has taken this step. If they didn't have it, you would hear "why don't they offer their own currency market to hedge risk or speculate?" It's a start, right?

[12DrinkMore]

Transparency that the futures markets can provide. It's commendable that Thai has taken this step. If they didn't have it, you would hear "why don't they offer their own currency market to hedge risk or speculate?" It's a start, right?

I don't believe that the futures markets offer transparency.

For exporters/importers this will provide the means of protecting themselves against adverse currency fluctuations. And if that is where the market stopped, it would be fine. Real goods, real dealing, real protection and stability.

Unfortunately the speculators will be jumping in and trying to exert their "tax" on the real wealth earners. The Thais should introduce a rule of no futures dealing unless there is a genuine physical product or service behind it. No highly leveraged bets causing massive swings because the amount of deals outweighs the real requirement many many times.

[samran]

"Going to make it available to Thai citizens"

Are they serious? Why? So they can lose what little money they don't have already? As if any of them even understand currency trading to begin with. There are probably less than 100 Thais in the entire country who do, and they trade abroad already.

Besides, why trade currency when you can play cards and the lotto?

Geez, great post.

You've just shown that you can't read and are stupid, all in one hit.

The service will be available to all 'Thai residents'. That includes you, so long as you aren't a visa runner.

As for less than 100 Thai people understanding it...good one. Please leave Thailand quickly as you are significantly dragging down the average IQ of the country at the moment.

Edited April 23, 2012 by samran

[fletchsmile]

Seems a reasonable development to me. As someone familiar with these products I'd say it's somewhat misleading to describe theme as simple:

Dollar future contracts will be available to every Thailand resident. The trading method is as simple as stock trading - a trading account with a TFEX broker is all that is needed. Investors can submit their orders by telephone or online. Up-to-date online trading prices and data are easily accessed via smart phones, laptops and other Net-friendly devices.

Business owners will find dollar futures a simple way to hedge against FX movement. Importers worried about possible depreciation of the baht can take a long position and effectively freeze the exchange rate at the current futures price. On the other hand, exporters can "short" dollar futures to hedge against risk of baht appreciation.

Sure the actual action of placing a trade may be as simple as stock trading, in that you call your broker or input online into a system. However, the risk management and understanding repercussions of a trade is not something I'd describe as simple, and definitely not as simple as stock trading.

Futures can be useful tools, but they're not as simple as stocks and if in the wrong hands, misused, misunderstood or with simple mistakes the risks are far higher than stock trading. Buy $1,000 stocks: worst case scenario you lose your $1,000. Buy $1,000 of futures, worst case scenario you lose a hell of a lot more than $1,000 + you also need to be managing the initial and daily margin calls and the other variables that come with them.

[4evermaat]

........

Sure the actual action of placing a trade may be as simple as stock trading, in that you call your broker or input online into a system. However, the risk management and understanding repercussions of a trade is not something I'd describe as simple, and definitely not as simple as stock trading.

Futures can be useful tools, but they're not as simple as stocks and if in the wrong hands, misused, misunderstood or with simple mistakes the risks are far higher than stock trading. Buy $1,000 stocks: worst case scenario you lose your $1,000. Buy $1,000 of futures, worst case scenario you lose a hell of a lot more than $1,000 + you also need to be managing the initial and daily margin calls and the other variables that come with them.

It is possible to lose more that your margin requirement, and even more than your account balance, but no broker would put themselves out there like that, that I know of.

Stocks (at least USA stocks) have many rules imposed, such as short selling, IPO, dividends. Leverage is poor (1:2) whereas leverage in futures can be 1:30 to 1:500+ depending on the contract traded. I think the Eurodollar is one of the most leveraged and highest volume futures contracts. $1,000,000 USD contract size for $450-800 margin deposit. That's over 1:1200-1:2000 leverage. Futures is a lot more straightforward: buy/sell and then offset.

I remember years ago trading the DAX. You could equate the emotions of a newbie trading that market to a tourist looking out of a window of a Thai mini-van driver. You are so unsure of what the next move will be (profit/loss), you just want to cut your losses short and get out as soon as possible.

[fletchsmile]

........

Sure the actual action of placing a trade may be as simple as stock trading, in that you call your broker or input online into a system. However, the risk management and understanding repercussions of a trade is not something I'd describe as simple, and definitely not as simple as stock trading.

Futures can be useful tools, but they're not as simple as stocks and if in the wrong hands, misused, misunderstood or with simple mistakes the risks are far higher than stock trading. Buy $1,000 stocks: worst case scenario you lose your $1,000. Buy $1,000 of futures, worst case scenario you lose a hell of a lot more than $1,000 + you also need to be managing the initial and daily margin calls and the other variables that come with them.

It is possible to lose more that your margin requirement, and even more than your account balance, but no broker would put themselves out there like that, that I know of.

Stocks (at least USA stocks) have many rules imposed, such as short selling, IPO, dividends. Leverage is poor (1:2) whereas leverage in futures can be 1:30 to 1:500+ depending on the contract traded. I think the Eurodollar is one of the most leveraged and highest volume futures contracts. $1,000,000 USD contract size for $450-800 margin deposit. That's over 1:1200-1:2000 leverage. Futures is a lot more straightforward: buy/sell and then offset.

Exactly the point. Simply put: The initial margin you put down is only an initial amount. The margin required can go up and down each day depending on the MarkToMarket of the trade, which as you say can move quickly given the leverage. The broker protects themself by setting a credit limit on your account based on an evaluation of your credit standing, plus you have a cash balance in your account to start. If you fail to stump up any additional cash on margin calls, then they are within their rights to close out your positions at a loss to you. etc etc