Currently, 180 currencies worldwide are recognized by the United Nations, meaning that if you have plans for traveling, you will probably need to exchange your currency. In other words, Foreign Exchange (FX) is the trading of one currency with another. Sometimes, however, it may get a bit confusing. It’s important for you to have knowledge of FX rates and how they work. Without such knowledge, you will be defrauded more easily at the time of exchanging currencies. For the purpose of making a markup, you may be charged unnecessary high exchange rates by banks and other financial institutes. Technically, banks are financial institutes with legal grounds for selling foreign currencies. But, at some point in this equation, they still need to have their own profit. To gain profit in the exchanging process, they create a markup. For example, let’s assume you want to exchange $100 Canadian for American currency. Today, October 2th 2022, Google shows the current real-time exchange rate to be 1.378, with no markups, of course. Thus, $100 CAD is equal to $72.56 USD because the US dollar has a higher value economically. But when you exchange the currencies you want through banks, the rate they offer is closer to 1.4144, so you will only receive $70 USD, meaning that the additional 2.5 dollars that you won’t receive will actually go into their pockets. We, at Danesh Exchange, sell USD at the same time for 1.365, meaning that you will receive 73.2 USD, which is the highest amount after the exchange. Basically, because of the high costs your bank charges in advance, you will never get the amount you should. Plus, if you intend to refer to a bank to send money to another country, you should know that in addition to complex service and handling fees, most of the banks will offer you a rate that is marked up as well. The Reasons Why Should Never Exchange at Banks If you seek to exchange currency, there’s a better option: an online service. Here’s the reason: You can Lock in the Rates When They Arise By nature, the FX market always changes. The reason is that, based on the balance of trade of every country, every country’s value of currency will witness a drop or rise. Thus, the exchange rates are always changing, a desired rate may show up for a very short time before rising again. For example, the Canadian dollar against US dollar weakened by almost 10% just in a month.