# Exchange rate for USA Property



## OppositeHouse (Jun 17, 2011)

I am wondering if anyone could provide some information on the best way to lock in an exchange rate for borrowing money to pay for real estate in the united states. Some bank rates for just exchanging money is 1.5 cents lower than the current exchange. Trying to lock in 300k or so on the current rate and want to know if anyone has ideas for doing so in the cheapest way and also if anyone knows of the best way to buy us dollars. Some have mentioned Horizons etf for exchanging canadian to usd.


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## I'm Howard (Oct 13, 2010)

Why not set up a U.S $ Bank Account at TD??


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## humble_pie (Jun 7, 2009)

would you be meaning how to exchange 300,000 CAD for USD without paying bank or broker FX fees.

yes there are ways to do that. You can do that using a trading technique called gambitting. You would be best off with a bmo investorline or a roybank online account because the 2 sides of a gambit can be done near-instantaneously & seamlessly online, selling to close a split second after you execute the buy to open side.

whatever you do, please don't try this at td waterhouse or scotia itrade. Their mainframe systems are different; they have more trouble with gambit trading; imho don't gambit with them unless you already have an established account with these brokers.

then there's forex trading. One member here has reported that he obtained an FX rate of .50% at questrade. That is considerably less than the rate discounters & banks will charge, so forex trading at questrade is also an option for you.

and there's interactive brokers, which has true FX trading with fees so low they are almost non-existent. But unless you are an experienced trader it's going to be a harder account to manage.


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## OppositeHouse (Jun 17, 2011)

Thanks for your reply, i already have a us dollar account. My question is surrounding either getting an exchange as close as possible to today's rate at .97 not the bank's .985 or being able to lock into today's rate as i am selling a property here and using those funds to buy in florida.


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## OppositeHouse (Jun 17, 2011)

Thanks humble, i have been looking at gambit. The loonie has been very volatile and i was buying usd when the loonie was over 1.05. I am at cibc and am considering contacting them about the gambit to see if they dont automatically convert the currency back to canadian $. I know horizon's etf fee comes in fairly cheap and a much better option to the rate the bank offers. I dont mind locking in today and seeing the loonie go higher, so the option of forex is interesting. Wondering if anyone has used cibc for gambitting?


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## m3s (Apr 3, 2010)

humble_pie said:


> then there's forex trading. One member here has reported that he obtained an FX rate of .50% at questrade. That is considerably less than the rate discounters & banks will charge, so forex trading at questrade is also an option for you.
> 
> and there's interactive brokers, which has true FX trading with fees so low they are almost non-existent. But unless you are an experienced trader it's going to be a harder account to manage.


This, or try Knightsbridge or XE.com. They offer better rates the more you exchange at once. You should be able to get a great rate for $300k by talking to them. You can get a quote and hold it for x days. Note that one problem I had was limits from my bank or transferring so much at once, I had to let xe know money would come in chunks


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## humble_pie (Jun 7, 2009)

opposite, as it happens a useful thread focused exactly upon your issue surfaced today in a nearby subject section. If you look under Investing you will see a thread entitled Converting USD to CAD.

this thread presents elaborate how-to information about currency gambitting, including the important link to Canadian Capitalist's blog article which offers clear, step-by-step instructions on the gambit strategy utilizing horizons' DLR & DLR.U.

the timing is perfect for you !! exactly the information that will help you.

i am sure that cibc will be able to do the DLR/DLR.U gambit for you. The only tricky question will be whether they will sell your DLR.U as soon as you have bought DLR, or whether they wll make you wait the miserable 3 days or longer for settlement-plus-journalling.

tdw is inconsistent about this - some representatives will do the sell side of a DLR gambit immediately while others will insist that client must wait - which is why i suggested that, if you were opening a new brokerage account, you might avoid tdw or itrade & head over instead to bmo or roybank.

as for cibc, the worst that can happen is that a representative will insist that you wait out the settlement period before you can sell. With DLR, this is not too terrible, since the USD/CAD pair does not shift very much over 3 days.

i have to say that i for one would never put up with any 3 day wait period from any brokerage, & being a fairly resourceful piece of pie crust, it's more than likely that i would wind up getting the job done instantly if not sooner.

since 300k is a significant amount, i feel you could use that in delicate negotiation with your cibc representative. Something along the lines of Yes, you would expect them to do the DLR.U sale immediately, because if they would not agree, then you would have to consider taking the entire project to another brokerage ...


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## I'm Howard (Oct 13, 2010)

I belong to Snowbirds who, on a monthly basis deposit money from my Canadian to U.S Suntrust account at a very favourable rate.

I am in the camp that believe the $CDN will strengthen to $1.10, I try to keep my US $ exposure to the minimum.

$300k for Florida R.E, must be one hell of a deal, remember, Foreign Country, guy at border can stop you from entering.


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