What is "Gain /Loss on Forex"...?

On the last section of "Statement of Accounts" that follows the calculation of "Operating Profit" there is a financial expense called "Gain/Loss on Forex".
This kind of expense stated within group of financial expenses such as:Interest expense...etc.

gain / loss on forex means gains or losses that are attributable to changes in the price of foreign currencies.

So, if the company pays $1 million a quarter in interest on Euro denominated bonds, since the dollar has been declining recently, they might actually have to pay $1.1 million in interest. They'd break that out though as $1 million in interest expense and $0.1 million in Loss on Forex, because you don't want to give the impression that there is more debt - you are paying more because of the movement of currencies (which in many cases, analysts would remove as non-recurring)

Depending on the company, that Forex gain / loss could be related to purchasing raw materials, ownership in foreign securities, debt in foreign currencies, or a host of other items, but you get the idea

Companies with international operations will hedge foreign currency risk by using the foreign exchange markets. For example, if Coke is going to buy a bottling plant in France and the deal is due to close in 3 months for 10 million euros then Coke will use the forex market to lock in the dollar cost of those 10 million euros because they've decided the bottling plant is a good deal but they don't want to take the risk that the it will take more dollars to buy 10 million euros in 3 months time. They're simply hedging their risk and there are thousands of companies that hedge this type of exposure, it's not only normal it's necessary as far as best practices is concerned.

Now, deal may fall through in 1 month and Coke will extinguish it's forex hedge or it may close out the hedge in 3 months and then pay the 10 million euros out of its international accounts. The important thing is that they hedged their risk, not where the final, actual 10 million euros comes from.

The gain or loss on these transactions is thus shown on the income statement.

With the decline of the US Dollar and prospective Amero (more below) you need to be careful where you invest your money.

Before investing in the stock market, or anywhere for that matter, you should go to this site and get a free copy of the ebook "Secrets to Economic Cycles". It will explain the best times to invest in different markets and the warning signs to get out, before it's too late. http://www.yourcoinbroker.com/EbookReque...

What will hold up in today's economy?

Gold is a great idea in today's uncertain economy (read on), but you need to understand the difference in stocks, rare coins, bullion, etc. Bars are bullion, only worth the weight of gold, whereas many pre-1933 gold coins will out perform any other gold investment out there.

Investing for Privacy, Protection and Growth

Talk to the expert and he will explain how certain coins outperformed others, even when they are all pre-1933, you need to know which ones will outperform any other gold investment. Whether you decide on bullion gold coins, gold bars, numismatic gold coins, etc., gold is the best option for privacy, protection and growth in today's uncertain economy.

Decline of the US Dollar

Gold is an excellent option, especially considering how the value of the US Dollar has declined 35% and is expected to decline another 40% in the next few years. The reason? We were taken off the gold standard. Just as the reason the Euro is doing so well? They are backed a percentage by gold.

The new proposed "Amero"

Have you heard of the Amero? That's the next biggie that will cause people to run and put all of their money in gold, not knowing how it is going to effect our economy, i.e. combining two "okay" economies with Mexico (US, CA and Mexico) and calling the new currency the Amero?

Here is a great site for so much information, and the author of the site is available 24/7 to answer any questions that you have. http://www.yourcoinbroker.com/value_of_t... You can call him any time and he will answer every question you could ever have without trying to sell you. What you do with that information is entirely up to you. Call the expert so you fully understand what you are doing before you go forward, whether you go through him or not, it doesn't matter, information here is key. Call Jim Burg Direct at (800) 630-2158 or (877) 299-4653.

He's the most knowledgeable in the business... no matter what your questions are with respect to any investment... that's all I have to say.

Hope this is helpful to you.

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