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I am sitting on close to $10,000. of U.S. cash. It is in a TD U.S. MMF which is making virtually no return for me. I tried to stock up on U.S. currency in anticipation of the Can. dollar dropping a lot and making something on the exchange. It doesn't appear this going to happen in the foreseeable future. I don't plan to use the funds in the U.S, for a purchase for example. What's my play here? e.g. - U.S. ETF? ING U.S. saving account? Convert to Canadian? Any thoughts?
 

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I would not convert to Canadian at this rate, although the Canadian dollar will probably rise in the short term.
Personally I would buy a good Canadian stock on the New York exchange and collect a dividend.
MFC would be my personal choice,but that has some risks obviously.
 

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I am in the same situation with a lot more money. I get paid in USD and have been holding off for Canadian to drop, but it does not seem like it will anytime soon. I wish we had the days where 1USD = $1.60CAD :)

I am sure many people here loving it at par, but not good for me.

I wish I had the answer you were looking for
 

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Depends on when you need it. If it's retirement fund, then just follow your asset allocation.

If you don't have an asset allocation, create one.
 

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This reminds me of a friend who said "CAD is so high I'm going to buy a bunch of USD so I make $$ when it falls back down"

Doesn't make any sense to me, cash is not really a smart investment when you consider the exchange rates and inflation. Why not buy some USD stocks or ETFs since you already paid the currency conversion and it is smart to put your eggs in different baskets after all
 

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The exchange rate can move pretty quickly. I have the same problem as you. You have to be able to exchange quickly when the rate gets to what you're happy with but in the meantime invest in US stocks that have been going up as the US dollar has been weakening. Otherwise you'll just keep losing and who knows how long the US dollar will stay weak.

I've put US dollars in GLD, SLV, DD, AAPL, LVS, and some others. Some are obviously higher risk than others.
 

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I am sitting on close to $10,000. of U.S. cash. It is in a TD U.S. MMF which is making virtually no return for me. I tried to stock up on U.S. currency in anticipation of the Can. dollar dropping a lot and making something on the exchange. It doesn't appear this going to happen in the foreseeable future. I don't plan to use the funds in the U.S, for a purchase for example. What's my play here? e.g. - U.S. ETF? ING U.S. saving account? Convert to Canadian? Any thoughts?
First the now obvious point that currency (forex) trading is not for amateurs. Sure you're not trading it exactly, but not a wise bet.

I would not convert it at this time. That leaves investing it in something, as noted depends on asset allocation and whatever fits that has value wins.
 

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Also you have probably noticed that US stocks tend to be overvalued so it is not a great time to snap them up. Just remember that holding cash and getting zero return is better than holding equities and getting a negative return.

Even the ADRs are expensive. Be patient.
 

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I have a separate $US account at my brokerage, which I use for all US trades. All buys, sells, dividend payments etc stay in $US , so theire are no forex charges on each transaction.


The problem is that I too like to be patient and wait for my price on stocks and ADR's that interest me.

This creates quite a big problem right now as my $US cash holdings, ( which are substantial), which are sitting ,waiting to be put to work on some good dividend paying stocks and assorted ETF's are earning next to nothing!
It's embarrassing to even tell you all what US cash is paying!

This is putting a drag on my returns, but I am fighting the urge to just "buy something", rather than let the cash sit around doing nothing.

I will try to take comfort in what Kcowan said in his post,

"Just remember that holding cash and getting zero return is better than holding equities and getting a negative return."

Also I too am waiting for the US dollar to get back up...the strong candian dollar kills me..and its bad for our overall economy too.
As my holding period is many years these fluctuations are a pain to live through, but more of a nusiance than anything else.

good luck
 

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Also you have probably noticed that US stocks tend to be overvalued so it is not a great time to snap them up. Just remember that holding cash and getting zero return is better than holding equities and getting a negative return.

Even the ADRs are expensive. Be patient.
Are you saying that the US valuations are high at this time?
The companies in the Dow? S&P 500?
 

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Are you saying that the US valuations are high at this time?
The companies in the Dow? S&P 500?
Yes I think so. The US economy is still in trouble. The business results do not reflect higher revenues as much as pared down expenses. There are exceptions, of course. LLL continues to outperform even though the US analysts are not behind them. I guess they are expecting an inevitable crash in retail.

I would appreciate anyone who believes that the fundamentals justify current valuations to chime in here. Which sectors are you bullish on? Other than minerals and technology.
 

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The currency war is one where the Canadian government has no control of. I'd really like to travel to the future to see how the cookies crumble on this one. It seems like very year we have a different and unpredictable reason for volatility of the currencies.

I get paid in US dollars so since I expect the US dollars to keep coming in, I'll always convert to Canadian when the exchange rate is right. I've been satisfied with 1.06 but it looks like I might have to be satisfied with 1.03 pretty soon.

I think if you put some money in GLD, as the US dollar goes down, GLD will go up. Or the US dollar goes up, GLD will go down. This should give you a little bit more balance.

I recently did a compare between GLD and the CIBC precious metals fund. The difference is that you're investing in actual gold or gold/silver/other precious metal mining companies.

After about 3 months, GLD is up 10%, CIBC Precious Metals Fund is up 32%.
 

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Back to the original question....

Where are any posters on here putting their US cash??

And what return are you getting on it?

As a Canadian I can put loose canadian cash into ALLY , lets say, and get 2%...which is lousy, but as least its something.

As a Canadian holding $ US cash,,,,there is no vehicle I have found yet, that comes remotely close to that up here.

We are not allowed to buy US bank CD's...( like our GIC's),,,

Has anybody found anything or anywhere , or any fund etc, here in Canada you can get a decent yield on US dollars?

Thanks in advance
 

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i asked on another thread how i can hedge against a rising us dollar but i want to hedge using canadian dollars

i think oil is probably the way to go

but, as to your question warp, i would exchange into cad and invest wherever you want

imo, the odds in favor of a cad rise is fairly good, though i listen to bloomberg and several commentators who i like have said they think the usd is oversold and will make a comeback soon

i just don't see that, bernanke has got to do something here or we could actually see a real pullback in the market

if he starts dropping money the usd/cad will go down
 

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Fat Cat

thanks for your reply...

I have a separate $ US trading account.
I keep all my Us and Intl buys , sells and dividend payments there.
That way i dont pay the forex spread every time I make a move or get a div.

At the moment I have large $ US cash holdings, waiting for buying opportunities.
I intend to keep this account in $US for many years .
I have faith that over the long term the Can dollar will revert back to its more common historical levels,,,around 85-90 cents /US

At least I sure hope so! In investing , you do your best and hope.

I also have a canadian dollar trading account, which is larger, to use for all my canadian investments, mostly dividend payers, and fixed income stuff.
I try and get my foreign US/intl diversity using my $US account.


Anyway what i was asking is if anyone has found any place to put these US dollars to work that pays a reasonable return here in Canada.
I sure have not been able to find one, so I was asking for anyones else's experience.

thanks.
 

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Anyway what i was asking is if anyone has found any place to put these US dollars to work that pays a reasonable return here in Canada.
I sure have not been able to find one, so I was asking for anyones else's experience.
oh i see, didn't quite get it i guess ... only thing i can think of would be a short term us dollar denominated gic ... maybe you could get .75 or something .. i know td offers them, i assume everyone else does, other than that i don't know ...
 

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This reminds me of a friend who said "CAD is so high I'm going to buy a bunch of USD so I make $$ when it falls back down"

Doesn't make any sense to me, cash is not really a smart investment when you consider the exchange rates and inflation. Why not buy some USD stocks or ETFs since you already paid the currency conversion and it is smart to put your eggs in different baskets after all
I have friends who say the same thing. Since this is the same thing as saying "the USD is cheap so I am gonna buy", it amazes me that these same people panicked when "it" happened (sub prime meltdown) and avoided cheap stocks everywhere.

I dont know where the dollars values are going and I dont care.

Like others have said, stick to your plan i.e assest allocation, or what have you.

Dont worry about currency values. Most "experts" get it wrong anyway.
 

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How about ING US Savings Account? 0.75% or RBC High Interest Savings Account 0.15%?

I don't know where you're located but in Toronto, you can actually take out US dollars from the ING bank machine which is great if you are traveling to the States.
 

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Davext,

thanks for the reply.

I have considered the ING $US savings account...

The main problem with that is that US dollars are NOT covered by CIDC.
(Canadian Deposit Insurance Corp)

Unlike your Canadian dollar accounts which are insured up to $100K per account, there is NO insurance with US dollar accounts.

So if ING were to go broke....the investor would be screwed, and supposedly lose every $us he ahd in his savings account.

The question is if its worth it to make .75%, and take that small chance.

Right now Im off to check on the turkey....its Thanksgiving Day, and Im having 15 people over for dinner,

My best to everyone on this board on this Thanksgiving Day.
 
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