Perhaps someone can explain to me where I'm going wrong.
Daily, OANDA send me a cross table of selected currencies, take Thursday 06 December 2012, prices are ask at cash rate:
EUR/GBP = 0.7793
Therefore 1 Euro buys 78 pence
To calculate GBP/EUR I would apply the formula 1/0.7793
This gives me 1 Pound buys 1.28 Euros
YET on the same cross table 1 Pound buys 1.19 Euros
What happened to the other 9 Cents?
Where have I lost the plot?