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Trading American stocks - best way / least commission or exchange rate costs

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  • Feb 17th, 2021 12:26 pm
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Feb 16th, 2021 12:01 pm
Tailwind72 [OP]
Jr. Member
Jun 1, 2019
186 posts
215 upvotes

Feb 16th, 2021 12:01 pm

Trading American stocks - best way / least commission or exchange rate costs

Hello all

I've been using CIBC Investor's Edge for trading in Canadian stocks, and use QTrade and Yahoo finance for monitoring stock prices. I'd like to get into American stock trading, but are leery of losing multiple percentage points on CAD -> USD -> CAD exchange rates back/forth when buying/selling (I'm a high frequency trader). It seems that what would be ideal would be to move a large lump sum of CAD into a USD account at a reasonable exchange rate, and then trade in USD using that account, with no exchange penalty per transaction - we are fine with a flat rate cost per transaction, i.e. that we experience with Investor's Edge for Canadian stocks.

Can anyone give some advice as to how I might be able to manage this, or relate any low fee way that you trade US stocks? Thanks!
Full Service Realtor
Niagara / Hamilton-Burlington
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Feb 16th, 2021 12:06 pm
aronpm
Jr. Member
Jan 5, 2015
161 posts
220 upvotes
Toronto, ON

Feb 16th, 2021 12:06 pm

InteractiveBrokers has the cheapest rates since it's just based off their forex platform

For everyone else, look into Norbert's Gambit method for your specific broker (basically just buying DLR.TO with CAD then selling it as USD once journaled over as DLR.U to the USD side of your account). Afaik, every broker lets you set up a USD side except for Wealthsimple
+1
Feb 16th, 2021 12:50 pm
melodymelody
Jr. Member
Dec 7, 2008
117 posts
178 upvotes
Toronto, Ontario

Feb 16th, 2021 12:50 pm

Tailwind72 wrote: ↑ Hello all

I've been using CIBC Investor's Edge for trading in Canadian stocks, and use QTrade and Yahoo finance for monitoring stock prices. I'd like to get into American stock trading, but are leery of losing multiple percentage points on CAD -> USD -> CAD exchange rates back/forth when buying/selling (I'm a high frequency trader). It seems that what would be ideal would be to move a large lump sum of CAD into a USD account at a reasonable exchange rate, and then trade in USD using that account, with no exchange penalty per transaction - we are fine with a flat rate cost per transaction, i.e. that we experience with Investor's Edge for Canadian stocks.

Can anyone give some advice as to how I might be able to manage this, or relate any low fee way that you trade US stocks? Thanks!
Based on your situation (high-frequency trader, desire for having good FX rates) - you may want to check out Interactivebrokers.

1. $1 commission per trade (unless you are trading penny stocks since commission is $1 for x number of shares).
2. $10 monthly fee - but offset $-for-$ by commission fees you pay. So if you make 10 trades a month, you don't have to pay any monthly fee. (Or the monthly fee is waived if you have $100KUSD in the account)
3. FX is done at a very good rate. Search this forum for more details.
Feb 16th, 2021 12:55 pm
Tailwind72 [OP]
Jr. Member
Jun 1, 2019
186 posts
215 upvotes

Feb 16th, 2021 12:55 pm

Thanks very much, will check out Interactive Brokers.
Full Service Realtor
Niagara / Hamilton-Burlington
Feb 17th, 2021 11:59 am
Mr Bean
Deal Addict
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Sep 19, 2013
2413 posts
854 upvotes
Winnipeg

Feb 17th, 2021 11:59 am

Questrade is also good. They allow a technique called Norbert's Gambit (google it) for you to transfer the money at near spot (with regular commission).

Breaking news: I read on reddit just now that Norbert's Gambit is going to be online and will be charged $11.95. But as per the reddit post, the charge is only for online requests, not for chat/ phone.
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Feb 17th, 2021 12:26 pm
sprinter
Jr. Member
Mar 18, 2006
145 posts
77 upvotes

Feb 17th, 2021 12:26 pm

Mr Bean wrote: ↑
Breaking news: I read on reddit just now that Norbert's Gambit is going to be online and will be charged $11.95. But as per the reddit post, the charge is only for online requests, not for chat/ phone.
New journal process

You will soon be able to place a journal request online, without the need of contacting us by phone, chat, or email. This service will be available for $9.95 + tax CAD per request. We will provide more details closer to when this service is ready to launch.

Not sure if this means no journal requests will be taken by phone, chat or email, or if $9.95+tax will apply using any channel.

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