Exchange rate calculators are online tools which you use to convert one currency to another. They usually come in the form of ‘widgets’ or programmed graphical https://fx-w.io/exchange-rates/ user interface (GUI) which automatically calculates the data that the user inputs to provide the desired results.
There are two general types of exchange rate calculators that you’d see around – the static and the universal.
The static is one which converts any currency to a fixed currency programmed into the widget. You need to input the second currency which you want to convert into the fixed currency, and the rate of exchange between the two. I find this type rather primitive and obsolete. People who’d want to use an exchange calculator do not usually know the exchange rate that’s why they are in need of such a tool to help them out determine the conversion value of a particular currency. Besides, anyone who knows the rate of exchange may just as well do the calculation himself using a standard calculator.
The universal one is the more common type of calculator that you’d see around. Conversion is simple. You chose the two currencies you want to exchange with one another by simply clicking on them at the 2 drop down menus contained in the widget (one menu for the base currency and one menu for the end currency). You then type in the quantity of the base currency you want converted. Click the convert button and you’d get the converted amount in a flash. You need not input the rate of exchange on this type of calculators since they link to real time data providers. The currency calculator of this type therefore converts currencies based on the latest exchange rate data coming from its real time provider.
People who find good use for these calculators are often the international travelers who’d like to know the value of the money they have against the local currency of the destination country. Businessmen who frequently enter into international transactions with foreign counterparts will also find good use of exchange rate calculators. They need to regularly check the rates of exchange because they have a great impact on their bottom lines.
However, there are other important things you must know when using money calculators. First, the conversion you get from the calculator is only indicative of the real amount you will get when you finally exchange your money at your destination – the converted amounts are often lower! This is because the money changer or the bank with which you will exchange your money will have to build in a margin of profit in every transaction they make.
The other important thing that you should know is that ‘not all exchange rate calculators are created equal’! Yes, that’s right, not all give exactly the same conversions. It’s because they are subscribed to or are linked to different sources of real time data feed. For purposes of providing an exchange rate indicator, the best source to link to would be to a data provider that has links to the interbank market where banks actually trade with each other using the EBS System (Electronic Brokering System) and the Thomas Reuters Dealing 3000 Xtra System. They are more reflective of the rates which most banks all over the world use to fix their own exchange rates for the day.