Forex Investment in a Singapore's bank

How does the principles of the above book apply to the individual? I will illustrate with one case. I don't play forex at all and so it is best for the reader to do much more research if he or she is interested in this high-risk trading.  

Standard Chartered Bank at Ion Orchard has this signboard outside, saying 4.15% interest if you invest in Australian Dollar deposits. As the A$1.00 is around S$1.30, my friend Julia was interested in this advertisement.

She wanted to buy some A$ low so that she could pay her son's tuition fees if she bought low. One year ago, the A$1.00 was as low as $1.00 but now, it has appreciated 30%. Singapore banks pay 0.3% (per annum) interest for savings account and therefore, the 4.15% (per annum) in A$ investment looks very attractive. So, I got her to talk to the financial adviser in the bank.  He recommended dual currency swap for her. What is a dual currency swap?

DUAL CURRENCY SWAP
Basically, this is a forex trading put option, I said to Julia. Julia would buy Australian Dollar at, for example A$1.00 to S$1.2708. 2 weeks later, at 2.30 pm, if the A$ has dropped to $$1.2580, she would make money of around S$500 based on a S$50,000 investment. In these 2 weeks, she would be paid 4.3% to 7% depending on the initial investment. At 4.3% for 2 weeks, she would get an interest of S$500 if she invested S$50,000 and if the A$1.00 has had not dropped to S$1.2580. If the A$ has dropped more than that, the bank keeps the balance of the profits. Another contract would be opened after the end of 2 weeks.   

"You get $500 for $50,000 after 2 weeks if the put option is not exercised. I asked the gentleman to state the interest in this deal rather than stating $500 profit. He said it is 2.5% for 2 weeks. Is this correct? It sounds too good to be true. There will be risks.

What are the risks? At the worst scenario, $50,000 will be lost if Standard Chartered Bank goes bankrupt. This has happened to Lehman Brothers, a very famous old bank in 2009. The Singapore Government does not guarantee investment accounts. Savings accounts are protected up to $20,000 so far.

Lots of small investors in Singapore lost substantial savings when Lehman Brothers closed down in 2009. Many people don't make money when they invest in unit trusts with their CPF (Central Provident Fund) monies at the wrong time. Timing is still everything but the investment bank is nowadays less than reliable as the bankers create high-risk derivatives and investment plans to make money for themselves out of money from the small investor. They pay themselves extremely well, even when their banks fail and have to be bailed out by the tax-payer's money. 

So, is it worthwhile for Julia to take this investment route? It is a personal decision. In my opinion, it is best not to take this risk as $50,000 is a large amount for Julia. 2.5% interest in 2 weeks is a very great temptation. This works out to be 5% per month or 60% per year in simple calculations. For Standard Chartered Bank, I have no doubt it will return Julia's capital. For scam people who proposed such returns, don't part with your money. I have just heard of a scam whereby the "investor" offered 2% per week and deposit some "gold" worth more than the market value as security. The only problem is that the real value of the "gold" is unknown.  

Julia has no interest in financial and market news at all and $50,000 was her retirement savings as well as money for her son's tuition fees.  She earned a salary. It would be better to be keep her savings rather invest in forex trading and funds unless she can afford to lose the money.