[crgf1k]

After selling stocks, I have a large amount of USD sitting in my un-registered Investor's Edge account. I would like to exchange it to Canadian so I can move it to my EQ Bank HISA. I've read that one way around the terrible bank exchange rates is to buy an inter-listed stock in the US and sell it on the TSX. I tried that with Agrium, but when I went to sell it there was no option to select the Canadian market. Any ideas?

 

[humble_pie]

After selling stocks, I have a large amount of USD sitting in my un-registered Investor's Edge account. I would like to exchange it to Canadian so I can move it to my EQ Bank HISA. I've read that one way around the terrible bank exchange rates is to buy an inter-listed stock in the US and sell it on the TSX. I tried that with Agrium, but when I went to sell it there was no option to select the Canadian market. Any ideas?

cibc broker is undoubtedly one of those brokers where client who is gambitting has to phone an agent to do the sell side. Brokers charge various commissions for these sell trades, but always more than the online commission.

have you already bought AGU on US market? better hurry up to sell

don't make the mistake of thinking you can buy one of the DLRs to carry you across the FX frontier though. DLRs don't work properly when going from USD to CAD. The reason is that only DLR.U is pegged, therefore a trader using the DLRs in reverse will be exposed to 3 days of currency fluctuation while waiting for settlement *

* although it might only be 2 days now, if we are already into T plus 2

 

[crgf1k]

cibc broker is undoubtedly one of those brokers where client who is gambitting has to phone an agent to do the sell side. Brokers charge various commissions for these sell trades, but always more than the online commission.

have you already bought AGU on US market? better hurry up to sell

don't make the mistake of thinking you can buy one of the DLRs to carry you across the FX frontier though. DLRs don't work properly when going from USD to CAD. The reason is that only DLR.U is pegged, therefore a trader using the DLRs in reverse will be exposed to 3 days of currency fluctuation while waiting for settlement *

* although it might only be 2 days now, if we are already into T plus 2

Yes unfortunately DLR doesn't work well going from US to CAN, as explained in the link below. I sold AGU online as soon as I saw there was no way to sell it on the TSX.

I ended up calling Investor's Edge, and when the trader answered I entered a purchase of CIBC's US stock, then he immediately entered the trade to sell it on the TSX at the bid price and offered to move it over to my checking account. I wish I was on the ball a few days ago, but oh well.

https://www.milliondollarjourney.co...ad-foreign-exchange-using-norberts-gambit.htm

 

[humble_pie]

Yes unfortunately DLR doesn't work well going from US to CAN, as explained in the link below. I sold AGU online as soon as I saw there was no way to sell it on the TSX.

I ended up calling Investor's Edge, and when the trader answered I entered a purchase of CIBC's US stock, then he immediately entered the trade to sell it on the TSX at the bid price and offered to move it over to my checking account. I wish I was on the ball a few days ago, but oh well.

https://www.milliondollarjourney.co...ad-foreign-exchange-using-norberts-gambit.htm

actually you did very well imho

just for the record, could you let us know what CIBC is charging for phoned gambit sell orders these days?

TD has settled down on a flat $43, which is higher than we'd hoped but at least it means no more stress over the issue. Even if one is doing an amount as low as $10,000, there's still a savings since the broker rate at close to 1% would mean $100 in broker FX fees.

when the currency arbitrageur gets up around $50k & the flat fee is still $43, the savings are awesome.

BMO & roybank, of course, remain the bargains at 2 instant online commissions. It's because they use a different mainframe which enables the pair trade.

.

 

[crgf1k]

actually you did very well imho

Thanks. The trader offered to convert it at a "preferred rate" because it was a large amount, but I decided to do the gambit. I think he said I would only be charged the $6.95 commission rate for the sell order too, but I'll have to wait and see.

 

[humble_pie]

^^

ah, a hi-value client ... each:

 

[gibor365]

After selling stocks, I have a large amount of USD sitting in my un-registered Investor's Edge account.

Don't know how large your amount, but the cheapest way regardless of discount brokerage will be:
- transfer US$ from your IE account to US$ checking account
- withdraw US cash in the bank
- go to private exchange and get your CAD$ (rate will be always less than in any bank)
- deposit CDN cash into CIBC checking account
- transfer to EQ

 

[masplata]

cibc broker is undoubtedly one of those brokers where client who is gambitting has to phone an agent to do the sell side. Brokers charge various commissions for these sell trades, but always more than the online commission.

have you already bought AGU on US market? better hurry up to sell

don't make the mistake of thinking you can buy one of the DLRs to carry you across the FX frontier though. DLRs don't work properly when going from USD to CAD. The reason is that only DLR.U is pegged, therefore a trader using the DLRs in reverse will be exposed to 3 days of currency fluctuation while waiting for settlement *

* although it might only be 2 days now, if we are already into T plus 2

Curious as to why you think you would have 2 days of currency fluctuation on Norbert's gambit in CIBC? It's true that the CAD side of DLR is floating, but all you have to do is call a trader and they can journal the DLR.U to CAD and sell it within 5 minutes, all for $6.95. I'd doubt that the currency would move much during this time. The price is determined at trade time, not settlement.

 

[gibor365]

I never converted USD to CAD using DLR, but did it a lot converting CAD to USD. It's really fast. You can be on line with IE rep do buy and ask to journal right away. and for us it's 4.95

 

[humble_pie]

Curious as to why you think you would have 2 days of currency fluctuation on Norbert's gambit in CIBC? It's true that the CAD side of DLR is floating, but all you have to do is call a trader and they can journal the DLR.U to CAD and sell it within 5 minutes, all for $6.95. I'd doubt that the currency would move much during this time. The price is determined at trade time, not settlement.

is cibc charging a low online commission for phone orders that are handled by licensed reps these days? if so, that is relatively new. A few years ago cibc was charging a regular agent-handled commission for phone orders, i believe.

wondering if the new low phone order commission is only for gambit sells at cibc; or does it now apply to all phone orders?

even if restricted to currency gambit sell orders which have to be phoned in, a low $6.95 commission would be a very attractive feature, imho. The total cost of a gambit pair trade would become 13.90. This should certainly bring new clients in to cibc.

but one has to inquire: if doing instant gambits, why would one bother to use the DLRs? they are funds with spreads, why not go straight to an interlisted carrier stock with no fund apparatus to contend with.

the DLRs were invented a number of years ago, to deal with a gambit trading environment that has since changed a great deal. At that time, brokers kept gambit shares in cash or margin accounts that had gone long in purchasing the buy side of a gambit pair, for the full 3 days until settlement occurred. The lock-down feature of DLR.U was attractive, in that clients could thus wait for settlement without any currency change.

.

 

[james4beach]

Everyone, keep in mind that stock settlement has changed to T+2 and this will effect some gambit operations, for example how long you have to wait before journaling shares.

For the kinds of gambits I do, the whole process just became faster.

 

[gardner]

I never converted USD to CAD using DLR

I converted US$10K last week. I did have to wait for the DLR.U to settle, but the final total cost relative to the spot rate on the morning I sold to C$ was about C$35. In the 3 days waiting to settle the $US was declining, but I do not feel like I was cheated or took an inordinate risk.

 

[gibor365]

I like DLR/DLR.U gambit because DLR.U price is not changing... When you call CIBC IE they on the spot move DLR shares to US side (DLR.U) and sell it and right away you have US cash available.

 

[humble_pie]

I converted US$10K last week. I did have to wait for the DLR.U to settle, but the final total cost relative to the spot rate on the morning I sold to C$ was about C$35. In the 3 days waiting to settle the $US was declining, but I do not feel like I was cheated or took an inordinate risk.

parties using the DLRs to move from USD to CAD, whose online brokers enforce a 2-day settlement period before releasing DLR.U to sell DLR online, will be exposed to currency fluctuation during those days.

it's usually less risky than waiting 2 days - previously 3 days - for settlement, though, because USD/CAD fluctuates less over short periods of time than most interlisted stocks that would typically be used in an instant gambit pair trade.

understanding what is going to happen also helps imho. What if DLR had dropped during gardner's waiting period, he would have acquired more! whee ...

i for one would never use the DLRs. I'd never do a delayed gambit. If i would gambit at TD i'd gladly pay the $43 sell side agent commission to get the job done instantly. I'd use a zero-cost interlisted stock, not DLRs. After all, it only costs $33 more than the $9.99 one would have to pay anyhow for the online sell commission.

this business of cibc charging only an online sell side commission when their licensed reps take phone orders for gambit sells is new. If it's true, it should earn cibc some new business. Although i'd be concerned that soon they'd change their commission policy back again, to full agent-handled fees for phone orders.