You are right that the dollar does seem to be doing well right now against the pound, but it seems to have dropped again in the last few days. The pound was the lowest it has been since March on July 8 , the day after the attacks (.578 to 1, i.e. for every £57.80 you get $100), but it's gone back up in the last few days to .566 to 1. I would say that if you want to hedge your money against the currency rate that you better do it quick. Otherwise you probably don't stand to gain any real advantage. One thing to consider is that since you are not dealing in particularly large investment you aren't going to get the rates listed above, but rather inflated ones from a high street bank. Then tack on service fees and you really do reduce your gain once more.
You have a few options for transferring larger sums of money from one currency to the next. Using travellers checks and Cash just aren't great options.
1.) Wire Transfer - For this you would need to have a UK bank account set up and a US one. The money gets automatically taken from one account and deposited to the other using the exchange rate from that day. It can take up to 5 days to see the money in the receiving account, but the rate used is from the day initiated. Check out the exchange rates your bank offers to convert dollars to pounds. Also factor in any transaction fees. I use a small bank in the US and they get absolute crap rates for foreign exchanges, not to mention charge about $40 min transaction fees. Because of this, it's not really worth transferring any money with them. Which leads to my second option, which is good if you don't have a UK bank account...
Bank Drafts - A bank draft is a check issued in another currency. You could easily get one of these issued for any amount and then just keep it in a safe place until you have a place to deposit it. Alternatively you could have it issued in the name of your University so you could just give it to them as payment. I generally use a bigger bank like Bank of America to buy a Bank Draft as they offer more competitve rates. You should be able to get one of these issued without holding an account. The problem with these is that it again takes about 5 days before you have the issued check in your hand, so not a last minute solution.
Like any form of investment, you could stand to loose money. No one can predict how the market moves, for instance the big drop in the pound and the UK market on Thursday and Friday of last week, could never have been predicted as it was due to an unforseen event. These are the kind of things that make investing fun, but also make it devastating if the market turns against your personal investments.
Just a thought before you enter into currency trading, does your university offer any way to "lock" in an exchange rate, knowing you are a foreign student? Is paying the full tuition in advance now while the dollar is up an option?
I hope this helps.
