GUIDE
FX & triangular arbitrage guide
From first conversion to reading cross-rate paths — one read is enough.
1. How rates are quoted
A quote BASE/QUOTE tells you how many units of QUOTE equal one unit of BASE: USD/CNY = 7.10 means 1 dollar buys 7.10 yuan. The inverse, 1 / 7.10, is the “inverse rate” shown next to every conversion on CalcFX.
Also note bid vs ask vs mid. The mid-market rate is the midpoint and what data sources publish; your bank sells above the mid and buys below it.
2. Spreads — the cost you actually pay
Seeing USD/CNY = 7.10 does not mean you get 7.10. Banks and bureaux add a spread, quoted in basis points (1 bp = 0.01%). Retail FX commonly costs 100–300 bp, which is exactly why the triangular calculator lets you set a fee per trade before trusting any loop.
3. Cross rates and triangles
A cross rate is implied through a third currency — e.g. CNY/EUR derived from USD/CNY and EUR/USD. When A→B, B→C and C→A are all available, the loop product above 1 signals theoretical arbitrage.
The honest caveat: any single source is internally consistent, so the product is always exactly 1.000000. Real gaps live between sources. CalcFX polls every public source, routes each leg to the best quote and deducts your fees — so the reported net return is closer to reality than textbook formulas.
4. A complete analysis on CalcFX (3 minutes)
Follow four steps:
Enter amount & pair
Open the converter, type an amount (e.g. 10,000), pick source (USD) and target (CNY). The result, both rates and the quote feed appear instantly.
Check feed & timestamp
The meta row under the result shows the snapshot date and quote feed code (A/B/C). If it says “stale”, the last refresh failed — reload shortly.
Open the triangular tool
Enter currencies A/B/C and capital; the fee defaults to 50 bp. You get per-leg rates, the best feed per leg, loop product and break-even fee.
Run a full scan
Pick a base currency and fee tier, hit scan. Every mainstream two-hop loop is ranked by net return — only positives survive.
Treat results as research leads, not trade signals. Re-verify every leg on your execution venue first.
5. Risk & compliance
Retail FX is subject to capital controls in many jurisdictions, and abusive arbitrage activity has legal limits. CalcFX publishes public data for comparison and research only — no trading, no advice.