Uzbek currency

[Frida]

Forum users,
I have a quick question regarding Uzbek so'm.

Is it convertible? If so when that happened? Is there a way to hedge against the sum?

Please let me know! Thanks a lot in advance!

Samimiy, Uzbekcfa, abcd, Prince and others please inputingizni ayamang. Shu savollarga javob juda kerak edi.

[Masud]

Forum users,
I have a quick question regarding Uzbek so'm.

Is it convertible? If so when that happened? Is there a way to hedge against the sum?

Please let me know! Thanks a lot in advance!

Samimiy, Uzbekcfa, abcd, Prince and others please inputingizni ayamang. Shu savollarga javob juda kerak edi.

AT akamiz yanayam aniqroq bilsalar keragu...

UZS is not convertible, GOLD is a good way to hedge against currency, even USD.

[Frida]

Masud, rahmat! Amiri Turkistoni shu postni ko'rib qolsangiz, iltimos. Javob kutib qolaman. :)

[learas]

UZS is not convertible in the World but in Uzb :)
But rate of UZS is periodically updated. For instance, As of July 4, 2008 the rate of USD 1 equils to UZS 1318.55 (Bloomberg)

[lilbit]

even in uzb it's not convertible. You have to pay a premium to convert it into anything else :D)))) It's called "premiya za vrednost'"

[learas]

You have to pay a premium to convert it

the fact is that UZS is convertible in Uzb, but usually it's done in the way that you say, unfortunately :?

[abcd]

Forum users,
I have a quick question regarding Uzbek so'm.

Is it convertible? If so when that happened? Is there a way to hedge against the sum?

Please let me know! Thanks a lot in advance!

Samimiy, Uzbekcfa, abcd, Prince and others please inputingizni ayamang. Shu savollarga javob juda kerak edi.

I am sorry but I have no idea. I am not in currency market. But if I were interested, I would compare performance of uzbek sum and other major currencies against basket of currencies, dollar, gold, oil etc and whenever I see negative correlation I would go with that currency as a hedge.

[lilbit]

and do not forget about INFLATION!!! It eats everything!!!!

[uzbekcfa2]

Frida, what do you mean if it's convertible?

do you mean if one can exchange a foreign currency with sum or vice versa? in that case, up to the limited amount per person as defined in financial laws in uzbekistan, you can exchange. However, convertability of the currency means, a foreign company doing business in a domestic market can change its profit from domestic currency into a foreign currency,such as dollar. I am not sure if they opened convertability in uzb yet. Last time it was banned in 1995, the year all foreign companies started to leave Uzb and settle their businesses in Kazakhstan.

about hedging...first of all, hedging vehicles such as forward contracts, futures contracts or swaps for Uzbek sum do not exist, so there is no way that you can hedge.

I think you thought about arbitrage opportunity. If so, forget about it. won't work with sum.;)

[Amiri Turkiston]

Bizani sumni dollarga aylantirsa buladi, lekin ozgina lekinlari bor.

Masalan:

1. Agar jismoniy shahs, sumni almashtirmoqchi bulsa....obmenniklar odatda Dollar yuq deb turadi . Lekin bir hil gostinicalarda muammo kamroq. Hullas 50% of convertability. Chunki bemalol bankni eshigini tepib kirib pulizni almashtira olmaysiz.

2. Agar kompaniya so'mini horijdan ul-bul olish uchun almashtirmochi....bu undan ham kattaroq muammo. Chunki, bir tuda qog'oz tug'rilanadi va keyin odatda 3 oy kutiladi.
3 oy deyishimni sababi, o'z tajribamga kura....lekin bu ham nimani import qilayotganizga bog'liq.
Bu esa 70% convertability. 100% demayotganimni sababi, idealniy variantda sumni kur schetiga bank olishi bilan - uni almashtirishi kerak, lekin bizada boshqacha...pulni olvolib 3 oy rezinka buladi. Masalan mandakangilaga bu voobshe ne vigodno. Chunki biza unaqa millioner kompaniya emasmiz, pulni tashab quyib boshqa ishni qilgani.

[ikbaljohn]

Lekin yana bir narsa: Sumdan ham pul qilsa buladi.

Yani, tahminan pahta o'rimi vaqtida, hamma pul pahtaga qarab ketadi, shunda banklarda sum zapaslari qolmaydi.

Mana ushanda, sumi borla soqqa qiladi :-)

yoqi haj sezonida ham soqqa qilsa buladi.

Shunaqa paytlarda dollar tez tushib tez kutariladi.

Lekin Sentabr Oktabr oylari, haqiqattan ham Sum topish muammo buladi.
Bir hil banklar daje valyutani sotib Sum qilishadi.

Amiri akasi,Frida xonim Amriqodek davlatdan kelib,sezon paytida dollarni so'm qilib yoki so'mni dollar qilib soqqa qimasalar kerak:D
Shu bankda so'm qolmagan paytida bank xodimlari tanish-bilishlaridan dollar yoki kreditga moshina olasilarmi,shapkasiz deb so'rab yurashardi o'tgan yili.Bankimizga naqd so'm kerak bo'lyapti deb:)

[Frida]

However, convertability of the currency means, a foreign company doing business in a domestic market can change its profit from domestic currency into a foreign currency,such as dollar.

that's exactly what I wanted to know. so you are not positive about convertability of so'm? right? i remember reading somewhere that foreign companies constantly had problems with uzbek currency, i assume its not convertable. but it was long ago and i was wondering if anything has changed.

about hedging...first of all, hedging vehicles such as forward contracts, futures contracts or swaps for Uzbek sum do not exist, so there is no way that you can hedge.

that's an exact answer i was looking for. thanks a bunch!

[learas]

that's exactly what I wanted to know. so you are not positive about convertability of so'm? right? i remember reading somewhere that foreign companies constantly had problems with uzbek currency, i assume its not convertable. but it was long ago and i was wondering if anything has changed.

it was and it is convertible my dear friends, but it's being done quite slow, i mean not in time. in our country this kind of convertion called as "repatriation of profit" - "repatriatsiya pribili".

[Oyaji]

Is it convertible? Is there a way to hedge against the sum?



1) Frida, are you asking this questions as a private individual, a company, or a bank :D

- if you are a private individual or a company and your location is in the west, then obviously you won't be able to walk in to any exchange office and exchange your UZS since this currency isn't the most sought after :D

but you could ask a few banks if they will be able to make a one-off currency exchange transaction for you with their uzbek counterparty banks.

possibly some representatives of uzbek banks in the west will be able to help you.

if you are in the "near abroad", i have seen a few exchange offices across CIS quoting UZS for exchange.

- if you are a bank, then possibly your treasury department will be able to close Foreign Exchnage deal with uzbek counterparty banks, if amounts are big of course :D

2) you can hedge anything, as long as you can find a counterparty to hedge :D (i.e. an entity who has position opposite to yours)

for example you could find a counterparty in US and make a Forward/Futures contract for UZS currency exchange. but i doubt that any company in US would have an open position in UZS at any point of time :D

so if you are talking about huge amounts of money, then the only way is to speak to your bank if they can find uzbek banks who would engage in Forward/Futures or other derivative contracts.

as far as i know there is no derivatives market in uzbekistan, and uzbek banks are not engaged in derivatives business. if this hasn't changed during the last few years :D

however, possibly some uzbek banks would make a Forward FX deal

[uzeconomist]

Forum users,
I have a quick question regarding Uzbek so'm.

Is it convertible? If so when that happened? Is there a way to hedge against the sum?

Please let me know! Thanks a lot in advance!

Samimiy, Uzbekcfa, abcd, Prince and others please inputingizni ayamang. Shu savollarga javob juda kerak edi.

Why do you need to hedge? or is Uzbek soum floating in the world market:). If you have a lot of money then hedging is just "uzbekchilik" to turn the rate any way you like .:)