A currency conversion fee is the charge applied when money moves between currencies inside a trading account — for example when a profit or loss realised in one currency is converted into the account's base currency, or when a deposit arrives in a currency the account is not denominated in. It is usually taken as a margin added to the prevailing exchange rate rather than a stated fee, which makes this forex conversion cost easy to overlook. Traders who deal in instruments quoted outside their base currency pay it repeatedly, on every closed position, so choosing a base currency that matches both the funding method and the pairs traded most often reduces how frequently conversion applies.
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How to Check the Way a Currency Is Managed
The regime behind a currency is published, not inferred. The four primary sources that say how a rate is governed, what each one can and cannot tell you, and how to keep the answer from going stale.