# Cheap Foreign Exchange



## JohnCSRivers (Jun 24, 2015)

Hey, I travel to the US from time to time and I find that the banks charge really high fees when exchanging my Canadian dollars to US. It's just absolutely ridiculous. What am I paying for????:upset::hopelessness:


----------



## leoc2 (Dec 28, 2010)

Welcome aboard. Google this--> norbert gambit


----------



## amack081 (Jun 23, 2015)

JohnCSRivers said:


> Hey, I travel to the US from time to time and I find that the banks charge really high fees when exchanging my Canadian dollars to US. It's just absolutely ridiculous. What am I paying for????:upset::hopelessness:


You may want to look into no F/X Admin fee credit cards such as the Amazon Visa.


----------



## uptoolate (Oct 9, 2011)

I second Amazon Visa as a solution. If you go often and spend reasonable amounts then Norbert's Gambit and a USD bank account. There are threads on both options on the site.


----------



## james4beach (Nov 15, 2012)

Can you imagine how much in fees the banks are losing out on, as a result of the discussions on these forums... it's beautiful


----------



## humble_pie (Jun 7, 2009)

james4beach said:


> Can you imagine how much in fees the banks are losing out on, as a result of the discussions on these forums... it's beautiful




so far, i don't believe that any *loss* in FX fees from clients who are doing their own currency arbitrage operations, aka gambit trading, or doing their own USD dividend protection, is yet on a scale that is even perceptible to the banks.

we're like the first wave of european explorers reaching the shores of north america in the 15th & 16th centuries. Other explorers are following close behind, but mass waves of colonists are still a long time off.

as it happens, i believe that bank/broker FX fees should be coming down, not going up as in fact they are.

the global currency trading networks that link all giant money centre treasury floors have become bigger, faster & far more efficient. Wholesale costs of FX trading are falling, not rising. Yet these benefits are not being passed on to consumers.

alas, what i've seen over the past decade is a marked rise in broker FX fees. Until a few years ago, the USD/CAD spread rate at TD broker was 1.90%. In recent years it has jumped to roughly 3%, an increase of some 50%, for no reason i can possibly understand, since FX trading costs for the parent bank's treasury floor should have dropped, or could have dropped if they'd been managing right.

i for one don't believe that regulations now in place force enough information about FX fees to be disclosed. Without proper disclosure, there's no way for consumers to know how they are being charged ... without consumers knowing, there is no way they can complain to the regulators ... without complaint to the regulators, there is no way that change can happen ...

fortunately, one can see that change is slowly happening these days. This forum has played a leadership role in publicizing how consumers can work around/circumvent broker FX fees in different situations. Let's continue the campaign.


----------



## brad (May 22, 2009)

It seems we need an F/X equivalent to Uber or AirBnB that shakes up the industry by offering foreign exchange with no fees and a favourable spread. If actual costs are that low, it can be done. DIY arbitrage (aka Norbert's Gambit) is way out of the league for most people, given that most people don't even have accounts at discount brokerages. But if a cut-rate service could spring up that offers a simple and more affordable alternative to FX from banks, XE Trade, and other existing FX services, it could force everyone to bring their prices down to be competitive, don't you think?


----------



## humble_pie (Jun 7, 2009)

^^

yes there is a thread - could find link if u would need it - where cmffers discussed several different kinds of ways a visitor could exchange about $500k from CAD into USD at lowest possible rates.

the visitor wasn't set up to gambit an amount that size, so the united wisdom of that particular thread guided her to Knightsbridge. She reported back that she was delighted with Knightsbridge, their rates are low, their service is excellent & they even offer various perks.

the Knightsbridge owner is apparently operating off the bank of montreal. My guess is that he enjoys excellent FX terms from BMO treasury, is getting rates from BMO that are almost bang on spot rates, is running a lean & economical business (an innovative business) so he is able to pass on most of those beneficial low rates to his clients.

thanks for point out how canada needs a UberFX (on re-reading your message, was XE trade so expensive? i thought they were supposed to be low price?)


----------



## newuser (Sep 16, 2014)

Let's back off a little bit here. For infrequent travel, the banks don't have the worst or best rates and they're maybe 2% off the spot rate. To convert some spending money of say $1000, that is only $20 difference. For frugal travellers (like those on this board), I'm sure we can get by with even less spending money, so it's a bit of a waste of time to chase the best exchange rate.

I know when I was younger, I fretted needlessly over that $20. What a waste of time that was!

But yeah, for $100s of K -- go do the NG.


----------



## humble_pie (Jun 7, 2009)

^^


folks here are typically arbing $10k-100k in currency gambit trades.

pocket change in low amounts such as $1k USD is usually withdrawn from cash in non-registered USD investment accounts.

that leaves only a small minority of folks who only want to exchange $1k but don't happen to have USD non-registered accounts with cash to spare. These folks should not hesitate to pay a bank's FX fee. It's a routine banking transaction, nothing more.


----------



## fraser (May 15, 2010)

We have not used a the bank for FX for years. We buy currency at the local FX store (as do some of the bank employees). We keep a USD account for depositing US cheques and withdrawing USD. We use a Chase Visa which does not charge the 2.5 percent admin fee, and we use Chase Visa cash advance when travelling in order to avoid our banks 3 percent charge.

When we lived in Vancouver, the best place to get USD, believe it or not, was MacDonalds in Washington state. Their exchange was always 2 points better than our bank. Mind you , you did have to buy something. Give them CAN and your change would be in USD.


----------



## uptoolate (Oct 9, 2011)

The McDonald's exchange rate reminded me of the best exchange rate we ever get which is when First Niagara Centre, home of the Buffalo Sabres, takes Canadian money at par - which they usually do whenever the CAD is above 90 cents or so. Suddenly everyone is buying their soda with a 50 dollar bill! Of course they are arena prices which are only slightly better than movie prices.


----------



## besmartrich (Jan 11, 2015)

I love Norbert's Gambit so much  So much saving from it for sure!


----------

