Currency Exchange Problem

OK! So I have problem understanding all those ‘we buy’ ‘we sell’ thingy whenever i go to the money changer counter. Most of the time I will just go there and change without understanding anything! But now I’m curious to find out what are those ‘we sell’ ‘we buy’ and how they calculate.

Now I found out that it’s actually quite simple.

exchange rates

Source: http://www.maybank2u.com.my/mbb_info/m2u/public/forexExchangeRates.do?channelId=BTRE-Treasury&cntTypeId=0&cntKey=BTRE04.01&programId=BTRE04-Rates&chCatId=/mbb/Business/BTRE-Treasury

Example 1:

I am in Malaysia and going to Europe. I want to change RM1000 to Euro. To know how much Euro I will get, I will need to use this formula:

Money to exchange (MYR) / Selling rate x Unit

= RM1000 / 4.2010 x 1 = Euro 238

Now I just came back from Europe and I have 100 Euro with me. If I want to change back to MYR, I need to use this formula

Money to exchange (Euro) x Buying rate / Unit

= 100 Euro x 3.9980 / 1 = RM399.80

Example 2:

I am in Malaysia and going to Indonesia. I want to change RM1000 to Indonesian Rupiah. To know how much Indonesian Rupiah I will get, I will need to use this formula:

Money to exchange (MYR) / Selling rate x Unit

= RM1000 / 0.0335 x 100 = 2,985,074 Indonesian Rupiah

Now I just came back from Indonesia and I have 1,000,000 Indonesian Rupiah with me. If I want to change back to MYR, I need to use this formula

Money to exchange (Indonesian Rupiah) x Buying rate / Unit

= 1,000,000 Indonesian Rupiah x 0.0290 / 100 = RM290

NOTES:

If you want to get more money, look for lower selling rate and higher buying rate

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