Nowadays, Million Dollar Journey’s writers are far more knowledgeable about this topic and feel those are reliable companies that can handle large CAD to USD transactions very well. From what I can see on their website, it appears that they charge a fee of approximately 0.5%-1.0% of the amount requested to be exchanged (plus wire fee). How do they work? With Knightbridge (minimum $10k), you wire them your USD (approx $20 fee), they would do the exchange, and EFT CAD back to your account. I’m a bit hesitant to write any examples as I have never used their services, but from what I’m reading online, a couple of competitive options are Knightsbridge FX and XETrade. While the two options above may not the best for someone without any trading experience, there are options out there that are truly easy and offer their services for a reasonable rate (relative to the big banks). Do it Online with Currency Brokers / Money Transfer Companies
#CONVERT CAD TO USD FULL#
You can read my full Interactive Broker review here. I can see this option being a great solution for existing IB account holders AND if you don’t need the money within 60 days, and willing to go with a brokerage that hasn’t ranked the highest on our discount brokerages comparison. to summarize, we recommend other online brokers like Questrade, but their currency exchange spreads are x100 higher than IB’s. Third, the IB user interface is not beginner friendly. In addition, if you EFT the money from a USD bank account into the IB account, and withdrawn into a different account (CAD bank account), they will hold the money for 60 days. First, you need an account with them which costs a minimum of $120/year (USD). However, there are some drawbacks of using IB as your primary currency conversion tool. Login to your account, place a forex trade for symbol USD.CAD, and sell the amount that you wish. Most discount brokers charge about 1-2% per CAD to USD currency exchange, Interactive Brokers charges: 1 basis point (0.01%) + $2.50 USD. This may be a the ultimate method of moving money from USD to CAD or reverse, as it is cheap, quick and easy (ish). It may sound complicated, but here is a step by step on Norbert’s Gambit. Most discount brokerages will require a phone call to “journal” your shares from your USD to CAD account. BMO and RY trading accounts will automatically move shares from USD to CAD, so there is no delay, so less risk of the stock moving against you. At a high level, the investor will purchase and an inter-listed stock (stock listed on both a US and Canadian exchange) like RY in USD, then immediately sell the same stock in CAD. To start, this strategy is best with RBC and BMO trading accounts. While this strategy is not for novices, it can basically reduce your FX spread to two trading commissions (plus buy/ask spread). Norbert’s Gambitįor those of you with a lot of USD in a trading account and looking to capitalize on a weaker CAD, there is a strategy called Norbert’s Gambit that you should be aware of. In light of this, here are some ways to reduce the cost of exchanging your USD to CAD. The former is not a bad at all margin for a trade but still isn’t the cheapest way to convert Canadian Dollars to US Dollars. Most financial institutions charge a healthy spread for foreign currency exchange, usually in the 2.5%-5% range, which on $100k is up to $5k in fees.ĭiscount brokerages do a bit better 1% and 2%. So what happens now if you have a bunch of USD and want to convert it back to CAD, or otherwise? Not only are you getting capital appreciation, but your dividends are getting paid in USD. Same goes for those who loaded up on US stocks during that time. Needless to say, those that took advantage of the opportunity to buy deflated US real estate when CAD/USD was at par (2010-2013) have made a great investment! Not only has US real estate prices appreciated (for the most part), but selling a USD investment today means a 40% premium when converted to CAD. Assuming that the condo did not appreciate since 2014, the condo today would cost $140k CAD. In November 2014, it would have cost $113k CAD (forget about foreign exchange fees for now). What does that mean in context? Well, say you want to purchase a $100k USD condominium in Florida. Due to the drastic oil decline over the past 18 months, CAD has followed the price of oil, today it costs about $1.40CAD to purchase $1USD. At the time of that post, it cost $1.13CAD to purchase $1 USD, or a 13% premium. Updated 2020 to provide additional information about an additional way to convert large amount of CAD to USD using Currency Brokerages / Money Transfer Comparisonīack in late 2014, I wrote about how great it was to be holding US Dollars (USD) due to the declining Canadian dollar (CAD).