Saving through currency trading

Originally from Scotland, I work as an English teacher in Japan. As I earn Japanese yen but still consider Scotland my home, sometimes I send money from Japan to my U.K. bank account.

Even though my pay this year is exactly the same as 2008, my yen (JPY) when changed to pounds (GBP) is now (March 2009) worth 150% what it was barely 6 months ago (September 2008). As exchange rates fluctuate over time, now is a great time for me to transfer money from Japan back to the U.K.

While this exchange rate lasts, I want to create a currency trading fund. My trading is not simply speculation [engagement in business transactions involving considerable risk but offering the chance of large gains, esp. trading in commodities, stocks, etc., in the hope of profit from changes in the market price]. Instead, I see it as a wise savings strategy that will allow me to make potentially large gains due to currency rate changes as well as standard bank interest.

At this stage I have no particular interest in dabling in currency trading without strong ties to the countries in whose currencies I am trading. For the time being, the U.K. and Japan are perfect for me. The prospect of being able to make free bonus money from simply sending money from Japan and back again is really exciting!

Moving savings between Japan and the U.K. will help me increase my savings at a much better rate than just leaving money in a bank in either country. This of course is dependant on fluctuations like those that I have seen during my six years in Japan. Over the long term I see this as being a very successful savings strategy.

This kind of savings strategy allows me to earn high interest even though my money is not tied up in a high interest account. I can still access my savings easily. My extra interest comes from taking advantage of the varying exchange rate.

Until recently I have simply spent my wages rather than consider saving for a rainy day or to make large purchases without resorting to a credit card. Sending money to the U.K. from Japan means it is slightly harder for me to access my money. This may help reduce impulse spending.

My trading rules are going to be:

when 1 GBP < 150 JPY - BUY GBP
when 1 GBP > 210 JPY - BUY JPY

Living by these rules, the worst case scenario: I save money!

Anyone with a foreign bank account and some long term savings money can make use of this savings strategy or fx trading system.

As an example, I came to Japan in March 2003. If I had been following this savings strategy since that time with a 3,000 GBP in savings, this is how I would have fared (excluding standard bank interest and currency exchange fees):

December 2005, 1 GBP > 210 JPY - BUY JPY (3,000 GBP = 630,000 JPY)
October 2008, 1 GBP < 150 JPY - BUY GBP (630,000 JPY = 4,200 GBP)

Saving money by currency trading has helped me pay clear my credit card debt and pay for a one month holiday to the U.K. (including spending money) within a short time period in the first half of this year (2009). Frugal currency trading is my method of choice to leverage my earnings to provide a much better rate of return than simply bank interest alone.

18.03.2009. 02:44