Using OANDA Live Exchange Rates
OANDA is electronically connected to numerous global banks to access the best currency rates for its forex traders, and electronic algorithms on OANDA’s fxTrade servers update exchange rates tick-by-tick, in periods of less than a second. The currency rates shown on this page are updated less frequently, but are still a close reflection of the rates available to forex traders right now.
When you trade a currency pair, you enter into an agreement to sell one currency in order to buy another. The value of the trade shifts over time as the market rate for the currency pair changes. You realize a loss or gain at the time you close the trade.
If you long a currency pair, you sell the second (quote) currency to buy the first (base) currency. If you short the pair, you sell the first to buy the second.
The dealer charges you a different rate depending on if you place a long or short trade, and again when you close the open trade. When you long a pair, you are charged a higher rate: the Ask rate. When you short the pair, you are charged a lower rate, the Bid rate.
DISCLAIMER: Trading off-exchange foreign exchange on margin carries a high level of risk and is not suitable for all investors. Trading through an online platform carries additional risks. Please refer to our more detailed Risk Warning, and NFA's FOREX INVESTOR ALERT.
There are several ways of showing bid and ask rates, including the Quote Panel.
The first (lower) number is the Bid rate; the second (higher) is the Ask rate. The spread—the difference between the two rates—is shown below these two values.
The difference between the ask and bid rates is the spread, and tight spreads make all the difference to successful trading strategies.