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Questrade: Converting CAD to USD (Cheapest way?)

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  • Dec 17th, 2017 1:18 pm
[OP]
Newbie
May 12, 2017
7 posts
1 upvote

Questrade: Converting CAD to USD (Cheapest way?)

Hi all,
Questrade charges 2% fee to convert CAD to USD (which I think is insane), is there any way to do it much cheaper?

I stumbled across this from 2013, but am unsure if it would still work. Does anyone use this or a similar method?
http://www.milliondollarjourney.com/low ... -u-etf.htm

Any insight would be appreciated!
15 replies
Deal Addict
May 18, 2015
1183 posts
280 upvotes
Ottawa,Ont
Alexk4424 wrote:
May 18th, 2017 11:43 am
Hi all,
Questrade charges 2% fee to convert CAD to USD (which I think is insane), is there any way to do it much cheaper?

I stumbled across this from 2013, but am unsure if it would still work. Does anyone use this or a similar method?
http://www.milliondollarjourney.com/low ... -u-etf.htm

Any insight would be appreciated!
Buy DLR, chat or call questrade immediately after and ask them to journal the shares to DLR.U...In 3-5 days the shares will settle. You then sell the shares and have USD in your account
[OP]
Newbie
May 12, 2017
7 posts
1 upvote
Thank you, glad this method still works, was unsure as that article was posted 4 years ago.
Deal Addict
Jun 3, 2009
3952 posts
491 upvotes
Montreal
nikels21 wrote:
May 18th, 2017 1:10 pm

Buy DLR, chat or call questrade immediately after and ask them to journal the shares to DLR.U...In 3-5 days the shares will settle. You then sell the shares and have USD in your account
Alexk4424 wrote:
May 18th, 2017 1:27 pm
Thank you, glad this method still works, was unsure as that article was posted 4 years ago.
I was often quoted 3 to 5 business days which means that it could take a whole calendar week. Thus, you are exposed to all kinds of currency fluctuations of our petro dollar during this lengthy process.
At other brokers, you can complete this type of FX spread-free with interlisted stocks like TD within the same day as long as you don't mind 2 commissions.
Deal Addict
User avatar
Aug 4, 2014
1185 posts
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Toronto, ON
As was explained many times before, once you buy DLR your rate is locked in as DLR.U only "fluctuates" by 1 cent.
Last edited by freilona on May 19th, 2017 5:45 pm, edited 1 time in total.
Deal Addict
May 31, 2007
4787 posts
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cn_habs wrote:
May 19th, 2017 3:27 pm
I was often quoted 3 to 5 business days which means that it could take a whole calendar week. Thus, you are exposed to all kinds of currency fluctuations of our petro dollar during this lengthy process.
At other brokers, you can complete this type of FX spread-free with interlisted stocks like TD within the same day as long as you don't mind 2 commissions.
As freilona explains, you lock in to your exchange. If anything, you are still in cash, and not "in" the market.
Member
Oct 12, 2008
307 posts
307 upvotes
Markham
The classic Norbert's Gambit.

These days I can't be arsed and my conversions rarely hit 5 digits so I just use TransferWise. Their rates are very competitive for smaller conversions.
Member
May 3, 2016
277 posts
16 upvotes
Dave510 wrote:
May 19th, 2017 7:55 pm
The classic Norbert's Gambit.

These days I can't be arsed and my conversions rarely hit 5 digits so I just use TransferWise. Their rates are very competitive for smaller conversions.
How does the rate at TransferWise comparing to Knightsbridge?
Member
Oct 12, 2008
307 posts
307 upvotes
Markham
wyho007 wrote:
May 27th, 2017 8:34 pm
How does the rate at TransferWise comparing to Knightsbridge?
Knightsbridge is slightly better (comparing CAD -> USD right now, you get about 75 USD more on an exchange of $10,000 CAD). TransferWise has more currency pairings. Depends on what you need, but if Knightsbridge works for you the rates are definitely attractive.
Jr. Member
Feb 3, 2013
129 posts
50 upvotes
GREENWOOD
Alexk4424 wrote:
May 18th, 2017 11:43 am
Hi all,
Questrade charges 2% fee to convert CAD to USD (which I think is insane), is there any way to do it much cheaper?

I stumbled across this from 2013, but am unsure if it would still work. Does anyone use this or a similar method?
http://www.milliondollarjourney.com/low ... -u-etf.htm

Any insight would be appreciated!
It's called a Norbert's Gambit, it works fine. DLR is likely best for CAD -> USD using Questrade although any interested stock can be used for the gambit, buying DLR effectively locks in the current rate for USD when the buy trade fills.

Note that both DLR and DLR.U trade on the TSX so pay attention to market holidays. Trades settle T+3 market open days.
Member
May 3, 2016
277 posts
16 upvotes
Dave510 wrote:
May 27th, 2017 11:25 pm
Knightsbridge is slightly better (comparing CAD -> USD right now, you get about 75 USD more on an exchange of $10,000 CAD). TransferWise has more currency pairings. Depends on what you need, but if Knightsbridge works for you the rates are definitely attractive.
My bank offers about 1% markup on the mid market rate, wondering what's the markup fro Knightsbridge/TransferWise. The only thing about Knightsbridge is, of course, opening another account and addition processing time.
Member
User avatar
Aug 11, 2011
203 posts
121 upvotes
Toronto
nikels21 wrote:
May 18th, 2017 1:10 pm
Buy DLR, chat or call questrade immediately after and ask them to journal the shares to DLR.U...In 3-5 days the shares will settle. You then sell the shares and have USD in your account
would buying CAD with USD work the same way except DLR.U then journal to DLR ?
Deal Addict
May 18, 2015
1183 posts
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Ottawa,Ont
MikeTO2 wrote:
Dec 16th, 2017 9:47 pm
would buying CAD with USD work the same way except DLR.U then journal to DLR ?
yup!
Member
Jun 10, 2013
261 posts
67 upvotes
MikeTO2 wrote:
Dec 16th, 2017 9:47 pm
would buying CAD with USD work the same way except DLR.U then journal to DLR ?
Geez, of all the Norbert's Gambit operations I've done, they were all done in one direction --> CAD to USD. Now we have settlement as T+2, amazing.
Member
May 3, 2016
277 posts
16 upvotes
Hobotrader wrote:
Dec 16th, 2017 10:23 pm
Geez, of all the Norbert's Gambit operations I've done, they were all done in one direction --> CAD to USD. Now we have settlement as T+2, amazing.
Do you need to buy DLR first, wait for 2 days (T+2) before you can buy DLR.U? Which online brokerage do you use?

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