STG prices relation to spot.

[simon13]

Has anyone worked out what the STG price relation to spot is? Is it a set amount above spot or a percentage? Just now maples are £14.40 and spot is £12.35 so that is £2.05 above spot or 16.6% above spot.

[garthy]

I've never worked it out but I do think that's seriously cheap, I doubt you could find anything for £15 that's only 16.6% above the price of the raw material.

I reckon it's a bargain!

[silversword]

When spot price rises, so does the coin price. When spot falls, so does the coin price. The exact mechanism they use doesnt really bother me because I can't influence them or the spot price.

[simon13]

@silversword, just curious. £14.16 Maples on my last order. Finding programable spot alerts quite handy although the last one went off at 02:30

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[morezone]

Also remember that when we look at spot it's £:$.  STG will use €:$.  Then when we see their price it is then £:€.  Therefore, currency fluctuations will also cause a change in price even if spot remains unchanged for us.

[simon13]

@morezone, will that not work out the same as spot is measured in dollars and will hold a proportional relationship in £:$ / €:$ relative to the £:€?

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[morezone]

As far as I am aware, all three currencies are independent of each other and any movement is not proportional.

[simon13]

I mean, that the currencies exchange will still be proportional to $ spot (?)

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[silversword]

There was a moment earlier this morning where USD spot was down, but GBP spot was up, because the currencies moved against each other. As I type this, Bloomberg is showing USD at 0.00 movement, EUR at +0.02 and GBP at +0.01. Basically they have the potential to be all over the place and a move in one doesn't correspond to a move in the other.

[morezone]

It's getting too complicated now.

 

Lets say spot in US$ today and yesterday is the same.  Lets also say that £:$ and €:$ yesterday and today also remained the same.  But lets say the £:€ changed.  Although spot was unchanged there is a price difference when buying in £ against the €.  The movement and price changes and differences can go in all directions.

[simon13]

Think I get it. Thanks chaps. I also have a $:£ alert set. Might have to do €:£ and €:$ alerts.

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[ChrisSilver]

It's getting too complicated now.

Lets say spot in US$ today and yesterday is the same. Lets also say that £:$ and €:$ yesterday and today also remained the same. But lets say the £:€ changed. Although spot was unchanged there is a price difference when buying in £ against the €. The movement and price changes and differences can go in all directions.

I don't think that is possible in the real world. As a currency either gets stronger or weaker it will have a better/worse exchange rate against all currencies that haven't changed value.

Also if £:$ and €:$ remained the same but there was a price change between £ and €. Then arbitrage would mean that this would not stay for long as traders would be buying one currency then another then back to the original currency with a profit.

[morezone]

I don't think that is possible in the real world. As a currency either gets stronger or weaker it will have a better/worse exchange rate against all currencies that haven't changed value.

Also if £:$ and €:$ remained the same but there was a price change between £ and €. Then arbitrage would mean that this would not stay for long as traders would be buying one currency then another then back to the original currency with a profit.

 

I was trying to illustrate it as simply as possible.

 

But as a currency gets weaker or stronger, it doesn't mean it will always have a matching exchange rate on other currencies otherwise it would all be directly proportional and related.  I don't think it is possible to have a currency that is unchanged against all other currencies.

In the real world, currency fluctuations would be in real time and all three (and the rest of the world currencies) would always be moving in various directions against/with each other.  Some currencies actually mirror other currencies because they are directly linked (or near as).

The £ is ever so slightly stronger against the € than the $ when compared to 1st Oct last year.

 

Yes, traders do buy currencies and then trade them back again for profit.  Joe public have been able to do it with multi currency bank accounts in the Far East for years.

 

At the end of the day there are so many factors which can influence many markets including currencies, and movement can be dramatic as well as subtle and it is the traders who can manipulate these movements and capitalise on gains.

[silversword]

And yet, when it comes down to it, all you can do is buy at the price you are offered. Spot price can do what it likes, the only concern I have now is: "Is this a good deal; am I happy with the price?"

There was a point where I would watch the price all the time, bemoaning when I had missed a dip or bought just before one, but the retail price movements weren't actually very large. In ten years time, will an extra £ here or there really matter?