Need for Euros

[PuckiTwo]

HP. Maybe I don't use the strategy because I think it is doubtful? Actually I think it's doubtful because I can't be bothered and I don't like complexity. If you can make it work good for you. My point was his bigger risk is delay and the subsequent FX risk that he could mitigate by doing a forward now.

Square Root, it is complex, it is cumbersome, and delay is a risk. But we have a need for currency conversions beyond the 50k I orginally posted and the more we can save on FX the better it is in the long run. The recommendations and discussions here are so helpful for us and thanks to everybody who contributes. I don't like delay either but to set up a structure it takes its time.

If you think the exchange rate is moving against you, you could also convert to Euro's today and hold in a high-interest savings account or something similar until the funds are required.
I have no ability to predict movements in the forex markets, in fact I don't think many people do. I would convert today or buy a forward contract, the worst that could happen is the Euro depreciates against the dollar and you could have had the Euro's for cheaper. Your costs are fixed this way, meaning you won't spend any more money than what is required at today's rates.

Ethan, no such thing as a HISA Euro account in Canada. Highest interest you can get is 0.1/0.15% <50k/>50k. The question when to buy: you have to watch the currencies as you do stock prices. Sure you cannot predict the movements but you can get a feel for what it's doing if you interpret news and watch it.

moving on: if the big green cannot gambit over the pond, it's almost totally unlikely that any other broker can, save & except possibly Interactive Brokers.
but IB's name is not relevant in a gambit context, because the huge strength at IB will be the ultra-low-cost forex trading opportunity that it offers.
anyone with frequent & repeated needs for offshore currencies might want to look into IB for this reason. It might suit Pucki to a Tee.

It actually does! We have dealt with currency issues for several decades - our business was with European companies and there was a time that we did not have to watch one currency (Euro) but 7-8. At that time Canadian FOREX was very expensive and we found another solution - and I didn't have helpful knowledgeable CMFers. I will explore all the tips mentioned here and post them as soon as I have everything together - and maybe there are interesting to some people. So far, there is only Scotiabank which offers a very very restricted Euro account - and according to comments upthread HSBC. However, I think as soon Harper gets his Freetrade agreement with the EU signed other Canadian banks will wake up too and there will be more people interested how to do FX with Europe.

[PuckiTwo]

Good & bad news:
the bad one first: No gambitting between TSX / European Exchanges or NYSE/European Exchanges. No gambit between European Exchanges either, for example, you can’t gambit between Switzerland and Germany.

Good news: here is what I found at Interactive Brokers:
- with an IB account one can buy and sell either currencies or stocks on most European exchanges. Stks bought on the Dax (Frankfurt) must be sold on the Dax. IB can keep the cash as Euro in the account until you want to withdraw, convert or trade again.

- if traders wants to withdraw the cash in Euro IB will transfer it to a Euro account which one needs to open either in Canada or in Europe. Account in Europe: European residents only. In Canada as far as I know Scotia and HSBC offer Euro accounts. IB would transfer the Euro cash into them.

- best of all: IB charges only 1.5 pip over spot. For example, if Euro cross is 1.2677, IB would sell for 1.26785. I checked this 2x because I couldn’t believe it but it seems to be correct. Haven’t tried it yet. That’s quite a fantastic spread I could live with.

- one can also do some kind of currency trading: exchange CAD$ for Euro when the Euro is as low as it is presently. Let the Euro sit in the IB account and sell it back into CAD$ when the Euro is high. A monthly account fee of CAD$10 would apply.

- IB account needs to be funded before trading or buying currencies, minimum CAD$10k. Stk trade cost $2.50/trade.

- if someone wishes to trade rather than buy currency, the IB account would be a margin account which could be funded in CAD$ and to pay for a European stk it could be borrowed against the CAD$ and no FX would occur at all.

[humble_pie]

best of all: IB charges only 1.5 pip over spot. For example, if Euro cross is 1.2677, IB would sell for 1.26785. I checked this 2x because I couldn’t believe it but it seems to be correct. Haven’t tried it yet. That’s quite a fantastic spread I could live with.

- A monthly account fee of CAD$10 would apply.

- Stk trade cost $2.50/trade.

this is what i meant upthread. FX trading at IB is very advantageous. That's why it doesn't matter whether or not one can gambit stocks at IB. There's no need to gambit stocks, FX trading is available & much simpler & cheaper.

keep in mind that the IB fee is $10/month or else at least $10 in commissions each month, whichever is greater. I would imagine that most clients work off that $10 in commissions. A point to check on: if client has $6.50 in commish for a particular month, would his fee be an extra $3.50 or would it be the entire $10 on top of the $6.50 commish ...

also a good idea to double-check that 2.50/trade commish. I believe commish might vary according to size of order. Also there might be quote data fees ...

[mode3sour]

A point to check on: if client has $6.50 in commish for a particular month, would his fee be an extra $3.50 or would it be the entire $10 on top of the $6.50 commish ...

also a good idea to double-check that 2.50/trade commish. I believe commish might vary according to size of order. Also there might be quote data fees ...

I don't do 10 trades a month in IB and the monthly fee is always the remainder of the $10. So in that case $3.50USD converted to the currency of your base account (CAD).

I believe I have 100 quotes of live data per month in IB (unlike my Questrade accts). You get more free live quotes if you spend a fortune on commish or have massive equity. Basically IB rules if only they did registered accounts.

Good news: here is what I found at Interactive Brokers:
- with an IB account one can buy and sell either currencies or stocks on most European exchanges. Stks bought on the Dax (Frankfurt) must be sold on the Dax. IB can keep the cash as Euro in the account until you want to withdraw, convert or trade again.

- if traders wants to withdraw the cash in Euro IB will transfer it to a Euro account which one needs to open either in Canada or in Europe. Account in Europe: European residents only. In Canada as far as I know Scotia and HSBC offer Euro accounts. IB would transfer the Euro cash into them.

- best of all: IB charges only 1.5 pip over spot. For example, if Euro cross is 1.2677, IB would sell for 1.26785. I checked this 2x because I couldn’t believe it but it seems to be correct. Haven’t tried it yet. That’s quite a fantastic spread I could live with.

Thanks for that post. I suspected I could have used IB to transfer CAD to EUR acct but I couldn't find any info at the time. I looked into linking my Euro acct but it didn't jump out at me. They've recently rebuilt the entire administration site from the ground up so I'll try again.

[PuckiTwo]

Thanks for that post. I suspected I could have used IB to transfer CAD to EUR acct but I couldn't find any info at the time. I looked into linking my Euro acct but it didn't jump out at me. They've recently rebuilt the entire administration site from the ground up so I'll try again.

IB's site comes in several languages, German, French, Spanish, etc. where do you have your Euro account? In Canada or Europe? In Canada which bank - am interested in other ppl's experience. Am not sure if I understood you correctly: if you hold Euro in IB, they don't have a bank account. You would need to have a Euro bank account outside of IB, they can transfer then.

[mode3sour]

Euro acct is in Europe but it I don't see why you couldn't use one in Canada. If I go to withdraw funds, I have the option of EFT or Wire. If I select Wire I can then select an account in many countries in many many currencies, bank or broker accounts. EFT only has the option for USD or CAD

[humble_pie]

but U should check out the cost of those wire transfers
pretty steep
the approach would be to FX larger amounts & only WD overseas currencies couple times a year ...

(aside to Pucki) (if U pass by) would you have an opinion on CHF you'd be willing to share ? will the authorities have to bow to foreign pressures & unpeg chf from euro, allowing chf to rise ... ?

[mode3sour]

€8 or $10USD from IB? Probably would have been cheaper on a $40k transfer, or even a few $1k.

TD actually charges me $30CAD to RECEIVE an international WIRE... which is annoying because the person paying it would have paid it otherwise..

[PuckiTwo]

(aside to Pucki) (if U pass by) would you have an opinion on CHF you'd be willing to share ? will the authorities have to bow to foreign pressures & unpeg chf from euro, allowing chf to rise ... ?

Hard to say, depends where the pressure comes from.Swiss are fiercely independent, conservative and an export country (from banking, watches, pharmaceuticals to tourism). Raise in CHF would be disastrous for export ....and industry is fiercely against it. Billions from EU bail-out countries are parked in safe haven CH. Investments still pouring into the country despite negative interest rates, creating pressure on the CHF and many people ask what CH will do with the over-abundance of Euros it bought.

Swiss National Bank has repeatedly said it will not to deviate from 1.20 Euro/CHF but Imho it will give “something” if pressure becomes too much. They may not go the whole way = unpegging the CHF and letting the currency rise. But they will have to stop the cash flow into the country such as “closing the border” to outside cash flow, restrict bank accounts owned by foreigners; restrict the amounts foreigners can deposit, etc. Simply to maintain Switzerland’s competitiveness, secure jobs. Many Swiss think 1.20 is acceptable...and that before the CHF can rise the EU has to bring its house in order.

The Swiss are good at taking care off themselves. Think about the pressure for them to join the EU. In the end they did not join the EU but they entered into treaties to “balance the act” .......
......my very humble and laymen opinion