# Changing Brokerage



## Sasquatch (Jan 28, 2012)

hello everyone,

just trying to pick some brains as to the best discount brokerage for our RRSPs and non reg. Investment accounts.

I want to change all our Accounts from Scotia I Trade to another discount brokerage and don't really know who to go with.

Our Accounts (my wife and I) are fully self directed with assets of $ 190.000.- and are all invested in just 3 mutual funds (MAW 104, MAW 105 and RBF 1350) and I have no intentions of changing that. 

I'm happy with their performance and the maintenance free nature of them ie. I might look into them once every couple of months or so to see how they're doing. I like it that way, nice and stress free 

There are no annual charges from Scotia I Trade of any kind and I want to keep it that way. All transactions can be done on line.

Just wondering if I could simply transfer the whole deal as is to another brokerage in kind without incurring any transfer/closing/opening charges. 

I know I could simply call another brokerage but I want to dip into the expertise here before going any further.

Any advice is welcomed :biggrin:


----------



## christinad (Apr 30, 2013)

TD is no good because it has a 35.00 redemption fee for non td funds. You have to buy a minimum 1000. bMO has a 500 minimum, I think cibcs was 500 or 1000. You can't buy mawer at royal bank. I really think itrade is the best option. I'll switch there eventually to avoid redemption fees. It is too bad because otherwise I'm happy with td.


----------



## My Own Advisor (Sep 24, 2012)

Why switch?

Sounds like you have a good thing going with iTrade.

If you do switch, you should strongly consider negotiating those fees with other brokerages. They can be waived if you talk to management and your book value is enough (i.e., > $100 k); which you have.


----------



## humble_pie (Jun 7, 2009)

normally one switches brokers for another broker that suits one's needs better.

but looking at your messages, it appears your move is intended as a punishment for scotiabank, because they didn't handle your overseas credib/debit card business properly?

as it happens, i don't believe that one retail client departure will even be noticed by the scotia algos that watch business growth & shrinkage. What you'd need to do is start a measurable stampede out of scotia. I don't see that happening for a single card story gone wrong here or there.

one thing i learned from the overseas credit card mixup stories is Always Carry 2 Cards. Make sure both have been used recently & are prepped with travel details. Me i'll never leave home again without em.

if you insist on leaving scotia because you feel you cannot stand the sight of their face, perhaps shop for the best cash promo deals. These appear to be BMO & questrade; however i sense that you might not be a questrade-y type of client. BMO offers $250 cash on a good day - you might have to wait for the promo but they're regular as clockwork - so with multiple accounts of acceptable size you should be able to load up $$.

another advantage of BMO is instant, online, seamless currency gambit trading. Evidently at the moment you are not holding US securities? but some day in the future you might want $10,000 in USD without paying FX fees ... online gambit trading is always a useful feature.

the only other broker whose trading platform permits instant online gambit trading is royal bank. However i haven't noticed roybank offering cash promos as regularly as does BMO.

bref, don't get mad, get even. Best wishes.


----------



## OptsyEagle (Nov 29, 2009)

Also, I cannot comment on the stupidity of brokerages, but the funds you have are known for low fees. Low fees mean very, very low commissions or none at all to the brokerage. 

So my question is, unless the new brokerage is incredibly stupid, they would have no incentive to take on your account, let alone pay your transfer fees to do so. Again, some brokerages will be stupider then others, so it may happen, but they would regret it. That being said, I would plan on paying $150 or so per account for the in-kind transfer.


----------



## leslie (May 25, 2009)

All brokerages now have an exit fee that is calculated either on a per-security basis or for an account closure. The industry has become like the garbage industry. The move is usually painless for RRSPs if you wait until 'RRSP season'. At that time many brokerages try to get you to switch by agreeing to pay your exit fees. The taxable accounts are another matter. I have never seen brokers advertise that they will pay your exit fees - but wouldn't hurt to ask.


----------



## humble_pie (Jun 7, 2009)

OptsyEagle said:


> Also, I cannot comment on the stupidity of brokerages, but the funds you have are known for low fees. Low fees mean very, very low commissions or none at all to the brokerage.
> 
> So my question is, unless the new brokerage is incredibly stupid, they would have no incentive to take on your account, let alone pay your transfer fees to do so. Again, some brokerages will be stupider then others, so it may happen, but they would regret it. That being said, I would plan on paying $150 or so per account for the in-kind transfer.



lol whoever heard of a broker as smart as the optsyeagle?

afaik the broker cash promos don't specify that a new client has to trade X number of times. They don't specify either that new client has to hold funds that pay decent trailers.

what they look for is size of account. Some mizzuble small accounts get their transfer fees paid, especially during RRSP season as leslie points out upthread.

sometimes brokers put a maximum dollar amount on transfer fees they are prepared to pay for any one client, so if the OP has extra accounts he could transfer some now, the rest in 2015 which is coming up soon.

however, when all is said & done, if it were myself i'd learn from the card experience so it doesn't happen again & i'd stay at scotia ...


----------



## gibor365 (Apr 1, 2011)

It's up to you transfer or not, but you may consider CIBC Investor Edge, they have promo now, if you transfer they give you $300 , 100 free trades and reimburse your transfer out fees


----------



## OptsyEagle (Nov 29, 2009)

humble_pie said:


> lol whoever heard of a broker as smart as the optsyeagle?


Well, we don't want to ask too much of them.

I would think that if paying a customer's transfer fees was automatic, they would probably lead with that in their ads and discussions. If I ran a brokerage, I would need to see that the account was profitable, before I would want to take it over, especially at an upfront cost. Remember, regulations require the brokerage to send him a minimum of 4 statements each year and confirmations of every transaction. Luckily, today most of those are electronic, but they still require technology to produce ... and that technology requires profits to pay for it. The brokerage will also need to pay someone to answer the phone, every time this customer calls. Again, all that costs money.

Personally, I do not see any profit in his account for a brokerage, and hence if I ran it, I would not chase after this account, by paying a fee that he really should be paying himself. After all he is asking Scotia trade to transfer an account and although we can all argue about how much that should cost, I don't think anyone would say the cost is $0.

Anyway, I am sure if he looks far a wide he will find a brokerage stupid enough to pay his transfer fees, but he should be ready and understanding about getting some resistance.


----------



## Beaver101 (Nov 14, 2011)

If I recall correctly from an article in the G&M (Sept. 29, 2014 - can't paste/access URL here unfortunately), there is a brokerage war going on currently so that time has come ... finally. Not encouraging OP to move brokerage but market share is market share ... and the consumers is always (well, almost) right. :biggrin:


----------



## AltaRed (Jun 8, 2009)

As already mentioned. RBC DI does not allow one to buy MAW funds. If that is important, one must first check with a brokerage to first see if it will: 1) allow MAW funds to be held, and 2) whether one can purchase more units. Often 1) is permitted, but not necessarily 2). The same might apply to RBF1350 D series with certain brokerages.

I see no reason why not to stay with Scotia iTrade.


----------



## humble_pie (Jun 7, 2009)

AltaRed said:


> As already mentioned. RBC DI does not allow one to buy MAW funds. If that is important, one must first check with a brokerage to first see if it will: 1) allow MAW funds to be held, and 2) whether one can purchase more units. Often 1) is permitted, but not necessarily 2). The same might apply to RBF1350 D series with certain brokerages.
> 
> I see no reason why not to stay with Scotia iTrade.



ah, yes, i'd forgotten that brokers don't like fund families that don't pay, such as mawer & steadyhand

(aside to sasquatch) (if u haven't totally run away) it looks like stay with scotia? learn to love your credit card(s)?


----------



## warp (Sep 4, 2010)

humble_pie said:


> another advantage of BMO is instant, online, seamless currency gambit trading. Evidently at the moment you are not holding US securities? but some day in the future you might want $10,000 in USD without paying FX fees ... online gambit trading is always a useful feature.
> 
> the only other broker whose trading platform permits instant online gambit trading is royal bank. However i haven't noticed roybank offering cash promos as regularly as does BMO.
> 
> .


Humble,

Would you please take a moment and go over, and explain the "instant, online, seamless currency gambit trading", that you mention at BMO and Royal.

I thank you in advance,

Warp


----------



## indexxx (Oct 31, 2011)

http://www.questrade.com/campaigns/...13-00-00-Qcom-Home-smallbanner-FreeToTransfer


----------



## Sasquatch (Jan 28, 2012)

Thank you all for your thoughts, very interesting indeed!
As some already guessed, I want to change because frankly I am pissed off with Scotiabank and don't want to give them my business anymore. 
It's more than just the ATM cash withdrawal fiasco in Germany last month. 

A couple of weeks ago I bought something online and payed for it with PayPal, using my Scotiabank Chequing Account. The purchase was made late in the evening and I deposited funds to cover the purchase the next morning. 
PayPal usually takes a day or two to withdraw payments so I wasn't worried. 
Well, turns out they put in a payment request that same night and of course there was NSF till the next morning.
Scotiabank was LIGHTNING FAST in slapping me with a $ 45.- NSF charge (for an $ 80.- item) for the sake of about 12 hours. They didn't miss a beat.
Well, I asked for a one time good will waiver of the NSF charge via secure message and was given the standard BS response. I've been with them for 30 years and never bounced anything. 
This is frankly pissing me off and I thought of doing business with someone else, including all our investments.

As a result of your comments I am sitting back and taking 3 deep breaths 

I had a suspicion that our portfolios are not very attractive to a brokerage as far as fees go, since they are low fee MFs with little or no trailer fees. As some of you said, brokerages are not very likely to fight to get our accounts since there is very little if any profit for them.

It would be a lot of trouble to switch everything over, not to mention the cost if I had to cover the transfer charges.

So, at the end of the day, I think I'll hold my nose and maintain the status quo for now. 

I'm not sure if I have any Scotiabank shares via my mutual funds. 
If I do, I'll eventually recover some of that $ 45.- NSF highway robbery charge.
Thanks again for all your input, it's appreciated.


----------



## humble_pie (Jun 7, 2009)

Sasquatch said:


> I'm not sure if I have any Scotiabank shares via my mutual funds.
> If I do, I'll eventually recover some of that $ 45.- NSF highway robbery charge



nae nae laddie dinna fret ye so

as i read your account declaration, you don't trade & you don't own a fund that pays much of a trailer fee, if indeed any at all. The poor broker has no chargeable services for these accounts.

tis in fact thyself, my friend, who is obtaining free securities custodial service from the broker. Tis the broker who is busting its bottom collecting & distributing dividends, mailing you statements every month, preparing & mailing you those nice consolidated tax slips every year, monitoring & surveilling 24/7 for mergers, acquisitions, special dividends & other re-orgs on your behalf ...

for every $100k in securities value that you presently have lodged with this broker, one might estimate you are receiving $500 worth of custodial services without charge. How nice is that.


----------



## humble_pie (Jun 7, 2009)

warp said:


> Humble,
> 
> Would you please take a moment and go over, and explain the "instant, online, seamless currency gambit trading", that you mention at BMO and Royal




warp i will be happy to, but first could you please reassure me that your request is not some kind of hallowe'en trick-or-treat?

you see, there have been hundreds of threads about currency gambit trading. Thousands of posts. Here i've been believing that every single investor in the land knows already about The Gambit.

especially longtime cmf members like yourself. CMF is where it all renewed itself in recent years. Hardly a week goes by but somebody on here doesn't bring the topic back up again.

executing a gambit trade at BMO is especially easy. As easy as, well, pie. You'll be very pleased. You'll never again, for the rest of your life, pay any kind of FX fee on US dollars to any bank or any broker.


----------



## Beaver101 (Nov 14, 2011)

Sasquatch said:


> Thank you all for your thoughts, very interesting indeed!
> As some already guessed, I want to change because frankly I am pissed off with Scotiabank and don't want to give them my business anymore.
> It's more than just the ATM cash withdrawal fiasco in Germany last month.
> 
> ...


 ... have you tried complaining to your "personal" banking manager or asking for the NSF waiver from higher up? In your situation, I don't think it's the brokerage arm is the problem but your bank one - the left hand doesn't know what the right hand does under the Scotia umbrella just like all their 4 other bank cousins.


----------



## Sasquatch (Jan 28, 2012)

humble_pie said:


> nae nae laddie dinna fret ye so
> 
> as i read your account declaration, you don't trade & you don't own a fund that pays much of a trailer fee, if indeed any at all. The poor broker has no chargeable services for these accounts.
> 
> ...


You're giving me cold chills ....... you mean there actually are financial institutions(brokerages) that put customers financial well being first by allowing them to buy mutual funds that generate next to no profits for them? Are they doing it just for good karma with no sneaky after thoughts, where the thought of profits doesn't even enter their minds?
This sounds like a new kind of financial saint that I must meet some day!!

Seriously, there must be something in it for Scotia I Trade. If there wasn't I'm sure they would've thrown my a$$ out of there a long time ago


----------



## Sasquatch (Jan 28, 2012)

Beaver101 said:


> ... have you tried complaining to your "personal" banking manager or asking for the NSF waiver from higher up? In your situation, I don't think it's the brokerage arm is the problem but your bank one - the left hand doesn't know what the right hand does under the Scotia umbrella just like all their 4 other bank cousins.


My secure message went to their banking division, not Scotia I Trade as such.

As for a "higher up" to complain to, there is no contact provision for that on their website.

There is a 1 - 800 number, but I can't be bothered to call to talk to someone who

a. has no authority to do anything

b. speaks with an accent that I can't understand anyway.

I prefer communicating via message or e-mail where there is proof of who said what and when.


----------



## humble_pie (Jun 7, 2009)

Sasquatch said:


> Seriously, there must be something in it for Scotia I Trade. If there wasn't I'm sure they would've thrown my a$$ out of there a long time ago


nae nae i don't see anything being thrown out ...

possible explanations

1) in part they do want to offer good services to good clients & you are probably a good client (keep in mind it's the bank that's bothering you these days, not the broker division)

2) they have got some sort of minimal arrangement with the fundcos

3) they are saints

4) almost no clients exhibit the kind of marvellous frugal discipline you are maintaining, so they can well afford to keep a few of you around

5) i don't believe a broker can ever "throw" a good client "out" with no reason

6) who knows, one of these years you might eventually morph into a highly profitable client indeed. Perhaps, in your dotage, you might become a client of their full-fee wealth management services. Boom! there goes 1.5% of capital, each & every year! they'd be in pig's heaven


----------



## Beaver101 (Nov 14, 2011)

Sasquatch said:


> My secure message went to their banking division, not Scotia I Trade as such.
> 
> As for a "higher up" to complain to, there is no contact provision for that on their website.
> 
> ...


 ... email / writing to complain is my preference too. Check your monthly statement - you should have a bank rep. / branch manager assigned to your account plus his contact # and start with him/her. If not, then call your branch and ask to speak to the branch manager ... start here first and I'm sure they would pay attention, especially you have been with them for 30 years (reiterate this to them).


----------



## Sasquatch (Jan 28, 2012)

humble_pie said:


> nae nae i don't see anything being thrown out ...
> 
> possible explanations
> 
> ...


The day I'll become a full-fee wealth management services client of theirs will be the same day I'll vote for Harper and his trained seals!


----------



## Sasquatch (Jan 28, 2012)

Beaver101 said:


> ... email / writing to complain is my preference too. Check your monthly statement - you should have a bank rep. / branch manager assigned to your account plus his contact # and start with him/her. If not, then call your branch and ask to speak to the branch manager ... start here first and I'm sure they would pay attention, especially you have been with them for 30 years (reiterate this to them).


I may ask to speak with the branch manager, even though I very rarely go to the actual branch and he/she wouldn't know me from Adam.


----------



## AltaRed (Jun 8, 2009)

Sasquatch said:


> A couple of weeks ago I bought something online and payed for it with PayPal, using my Scotiabank Chequing Account. The purchase was made late in the evening and I deposited funds to cover the purchase the next morning.
> PayPal usually takes a day or two to withdraw payments so I wasn't worried.
> Well, turns out they put in a payment request that same night and of course there was NSF till the next morning.
> Scotiabank was LIGHTNING FAST in slapping me with a $ 45.- NSF charge (for an $ 80.- item) for the sake of about 12 hours. They didn't miss a beat.


ISTM you really have nothing legitimate to complain about. Keep enough funds in your account to cover obligations plus some reserve. No need to run an account that close to the line when the best you can do is about 2% on cash. Think about it: $1000 @ 2% = $20 interest before tax on an annual basis. 

You also should know that with computer generated activities, transactions can be immediate (I've seen PayPal payments happen same business day). The NSF was computer generated as well instantaneously, and responses to Secure Messages come from a central office, not your branch office. Those central robots are not likely in a position to make exceptions. Call up your personal banking representative noted on your statement and ask again for relief. You may well get it - I've gotten concessions being nice to my personal banking rep (or whatever titles they use).


----------



## Sasquatch (Jan 28, 2012)

AltaRed said:


> ISTM you really have nothing legitimate to complain about. Keep enough funds in your account to cover obligations plus some reserve. No need to run an account that close to the line when the best you can do is about 2% on cash. Think about it: $1000 @ 2% = $20 interest before tax on an annual basis.
> 
> You also should know that with computer generated activities, transactions can be immediate (I've seen PayPal payments happen same business day). The NSF was computer generated as well instantaneously, and responses to Secure Messages come from a central office, not your branch office. Those central robots are not likely in a position to make exceptions. Call up your personal banking representative noted on your statement and ask again for relief. You may well get it - I've gotten concessions being nice to my personal banking rep (or whatever titles they use).


Agreed, I know I don't have a legal leg to stand on, but that's not my point.
My point is that there should be allowances made for a long time good customer for a one time slip up. I'd call that good customer relations, but that's just me.
I may try the local route yet!


----------



## AltaRed (Jun 8, 2009)

Sasquatch said:


> I may try the local route yet!


That is the only way for a specific request on your specific account. I suspect every big bank works that way.


----------



## christinad (Apr 30, 2013)

Those at td know you have to maintain 5000 in your account or you are charged 29.95. (This to get a free Travel Visa card if you have the account.) Well I was under 5000 for a day and got charged the 29.95. When I mentioned I was going to switch bank accounts to avoid the fee if this happened again they swiftly reversed it. Threaten to leave their business or lose business for them in some way and they may jump to help. Also you could leave Scotia bank and stay at itrade. I thought it was easy to set up itrade with another bank through bill payments or eft. I thought it was easier then some.


----------



## AltaRed (Jun 8, 2009)

christinad said:


> I thought it was easy to set up itrade with another bank through bill payments or eft. I thought it was easier then some.


It is. I set up EFT at iTrade to transfer money to at least 2 non-Scotia banks, and to move money the other way (to iTrade), I simply use Bill Pay. It was impossible to do that at RBC DI (cannot set up an EFT to move money from RBC DI to a non-Royal institution).

The OP should recognize that for all intent and purposes, the discount (and full service) brokerages at the major banks operate independently of the retail arms. You can love one and hate the other.... no big deal.


----------



## Xoron (Jun 22, 2010)

Sasquatch said:


> Agreed, I know I don't have a legal leg to stand on, but that's not my point.
> My point is that there should be allowances made for a long time good customer for a one time slip up. I'd call that good customer relations, but that's just me.
> I may try the local route yet!


I'm with CIBC Banking and went over my account balance due to automated billing withdrawls. I paid the bill one day late, then they requested the full funds again. Double payments on a large bill and didn't have enough funds to cover both.

Anyway, I went into CIBC and they did reverse the NSF fee for me "One Time" as a "Favour". So it does happen (accidental NSF and reversal).


----------



## Sasquatch (Jan 28, 2012)

Well boys and girls, this morning I decided to pay my local branch a visit concerning the NSF charge.
Walked up to the nice lady sitting at a desk not far from the tellers and asked her who I could speak with concerning this matter.
She smiled and said that I could start with her...... Perfect, so I sat down and told her my story.
After listening attentively she said that as a rule there are NO NSF CHARGE REVERSALS but she would have a look at my accounts and my history.
Also told her my tale of woe about my trip to Germany last month and trying to withdraw money via a foreign ABM from my Scotiabank Account.
I was very calm and friendly, just stating my case without being confrontational or accusing anybody of anything and she said all of a sudden that she would agree to reverse the charge on a goodwill basis and just this one time, since this had never happened to me before.
I thanked her for her understanding and she said it was a pleasure doing business with me!!

Lesson learned: Be calm and courteous when making your case, don't make any accusations and just state the facts as you see them.

Had I waltzed in there, pounding my fist on her desk and asking her what kind of fu**ing operation they were running I'm sure that my request would've been denied.

It literally pays to be nice!!!!!!!!!!!


----------



## My Own Advisor (Sep 24, 2012)

Nicely done ))


----------



## gibor365 (Apr 1, 2011)

> Had I waltzed in there, pounding my fist on her desk and asking her what kind of fu**ing operation they were running I'm sure that my request would've been denied.
> 
> It literally pays to be nice!!!!!!!!!!!


BS  It doesn't pays to be nice! I'm sure you would get even more if you were yelling at her  they just scared from such customers...
Just yesterday I was doing FX netting in Investor edge and rep entered wrong amount doe US MM sell and trade got rejected... after I call and she start explaining that this is problem with system etc... I said that she stop bullshiting me and it's her personal problem that she cannot enter correct numbers... I requested not only better FX rate that I got , but also 5 free trades ... and said that if not, I'm gonna escalate issue to her supervisor and retail investment senior director.... today I got not just 5 free trades, but amount in Cash..

I had several issues like Sasquatch described with my accounts and credit cards and always I got charges reversed...and I`m never polite  ... majority of financial institution even have policy about 1 time `pardon`once per year...

P.S you should be polite only with CRA, CPP and similar government bastards... with those guys impossible to fight back ... with private financial institutions it`s much easier ... they don`t want to loose clients with tons of cash because of couple of $ reversals...


----------



## Toronto.gal (Jan 8, 2010)

^ LOL.

I'm always polite, but I point out each & every error. I don't believe in letting mediocrity thrive.


----------



## Beaver101 (Nov 14, 2011)

Sasquatch said:


> Well boys and girls, this morning I decided to pay my local branch a visit concerning the NSF charge.
> *Walked up to the nice lady *sitting at a desk not far from the tellers and asked her who I could speak with concerning this matter.
> She smiled and said that I could start with her...... Perfect, so I sat down and told her my story.
> After listening attentively she said that as a rule there are NO NSF CHARGE REVERSALS but she would have a look at my accounts and my history.
> ...


 ... glad this worked out for you :encouragement: ... it does pay to be courteous and nice first (not just you the customer, but the bank staff also). And then I see here from subsequent posts why some bank staff is cranked out before you get to even get to say a friendly hello. 

As for pounding the desk and swearing at the bank staff - I don't think we stand a chance - bank security will be called to man-handle the situation.


----------



## Beaver101 (Nov 14, 2011)

Toronto.gal said:


> ^ LOL.
> 
> I'm always polite, but I point out each & every error. *I don't believe in letting mediocrity thrive*.


 ... + 1


----------



## gibor365 (Apr 1, 2011)

> As for pounding the desk and swearing at the bank staff - I don't think we can stand a chance - bank security will be called to man-handle the situation.


 no need to pound the desk  all my issues i in 99% resolve over the phone... if you are not satisfied , immediately ask to speak to suprevior, manager etc


----------



## Beaver101 (Nov 14, 2011)

No you won't be pounding the desk since you would be on the phone to ensure -


> I'm sure you would *get even more *if you were *yelling* at her they just scared from such customers...


 :biggrin:

Btw: I don't think they're scare of such customers ..


----------



## gibor365 (Apr 1, 2011)

Beaver101 said:


> No you won't be pounding the desk since you would be on the phone to ensure - :biggrin:
> 
> Btw: I don't think they're scare of such customers ..


The point is you need to know with whom and with what tone you can talk  Sometimes I can be extremely polite


----------



## warp (Sep 4, 2010)

humble_pie said:


> warp i will be happy to, but first could you please reassure me that your request is not some kind of hallowe'en trick-or-treat?
> 
> you see, there have been hundreds of threads about currency gambit trading. Thousands of posts. Here i've been believing that every single investor in the land knows already about The Gambit.
> 
> ...


Humble 
I assure you my request is an honest and ,(err) humble one.

Please tell me more about how and why the Gambit is so easy at BMO.
and how I will save so many dollars on Forex in the future.

I will thank you in advance for your reply, and will be your (err) humble servant.

Warp


----------



## humble_pie (Jun 7, 2009)

warp said:


> tell me more about how and why the Gambit is so easy at BMO.
> and how I will save so many dollars on Forex in the future



ok each:

gambit trading is just plain old arbitrage. You buy in one market while instantly selling the same thing in another market, for some tangible benefit.

here we are buying interlisted canadian stocks on toronto & selling them on new york, or else the reverse.

in either case the fast gambit trader will obtain an FX rate that is very close to, or else bang on, the spot rate. He'll obtain the same FX rate as the one negotiated only a minute before by the world's largest money centre banks, thanks to the arbitrageurs who keep both markets picked to the bone. In other words, the currency gambit trader is riding on the coattails of the arbs.

Part I. Setting up.

first, have a look at XE.com. This will show you CAD/USD money centre rates, updating every minute. These are the median spot rates; you will be getting a rate that will be close to these.

as an interlisted carrier stock, you'll want to choose something that is:

a) highly liquid in both canadian & US markets;
b) has the same CUSIP number in both markets;
c) is *not* something you already own (because if it is, then arbitraging it will trigger capital gains/loss results)
d) a low beta stock, ie one that is not volatile;
e) stock should be having a quiet, sleepy day. No earnings. No dividend X dates. Nothing happening.

banks are excellent candidates, especially TD & RY. I'd suggest going with one of these if you don't already own td or ry. (i'm not sure about sufficient US liquidity in bns, commerce bank, bmo or natbank)

MFC & POT can be ok some days, if sufficient liquidity (mfc) or quiet trading (potash.)

next, set up detailed quotes & survey the field of battle.

watch how stock in the currency where you intend to sell is flowing. This will be the key. For a CAD/US conversion, you will be buying, say, RY in toronto & selling it on new york. So watch the new york prices. You do not want them to be falling. You want them to be rising in a cascade that will last at least a few minutes. View advanced short-term charts if necessary.

Coming up. Part II. Doing the actual Gambit Trade at BMO


----------



## HaroldCrump (Jun 10, 2009)

I have always used Royal Bank of Canada (ticker symbol : RY on both sides) for currency gambit.
Excellent liquidity, thus tight spreads, and low intra-day volatility.
Basically with RY, all current market information is factored in by 10:00 am.

One important fact in humble's post above is particularly worth noting - do not use a stock you already own for currency gambit (unless gambitting in a registered account at a brokerage that allows it, such as Questrade). 
Pick something else in non reg. accounts (there are enough candidates).
I would personally not pick a commodity related stock such as Potash, Talisman Energy, etc.


----------



## humble_pie (Jun 7, 2009)

Part II. Doin the BMO Gambit

- work fast when the moment of truth arrives. Buy your stock on the canadian side, same way you've always done. Let's say 1000 shares of RY.

- immediately, get the quote for RY on US market (i always use Quotes Plus, don't know about ordinary quotes). Be sure you get the US quote, this really does matter on the BMO trading platform.

- go to Trade Now & set up your sell order for 1000 RY. Specify Sell on US market (important). Also Specify Settlement in US funds (equally important).

- send order.

& you're done! 

the only thing to add is that your account is going to look peculiar for about 5 days. It will show both long & short 1000 shares of RY. Your portfolio totals might also be inaccurate. Don't worry, this is normal. Approximately 2 days after normal settlement date - ie by the 5th day at the latest - the transaction will flatten. You'll be left with zero shares of RY but you'll have all those lovely new US greenbacks, with no FX fee whatsoever.

warp u are going to love this


----------



## warp (Sep 4, 2010)

Humble....my fine and knowledgeable friend,

Thank you for your inspired reply. I did have some knowledge about the Gambit.....but am always eager to learn from a more experienced professor and practitioner, such as yourself.

I will say however, that I already have quite a lot of those lovely US greenbacks..( both in cash and in stocks).

I would be interested in turning those US greenbacks into equally lovely Canadian dollars at some point.
I assume I would simply just do the opposite.....that is BUY on the US markets in US dollars...and SELL on the Canadian market in Canadian dollars.
This would now turn US dollars into Canadian dollars at the spot exchange rate , thereby sidestepping forex fees.
Do tell if I am correct. Have you done it this way as well?

Thanks for the reply, and for the further info, which I will look for here
....your still "humble" servant, warp


----------



## humble_pie (Jun 7, 2009)

warp said:


> I would be interested in turning those US greenbacks into equally lovely Canadian dollars at some point.
> I assume I would simply just do the opposite.....that is BUY on the US markets in US dollars...and SELL on the Canadian market in Canadian dollars.
> This would now turn US dollars into Canadian dollars at the spot exchange rate , thereby sidestepping forex fees.
> Do tell if I am correct. Have you done it this way as well?



yes & yes & yes & yes & yes. I have arbed in the opposite direction. It works perfectly.

remember, too, that you can always do what i call a "half-gambit." When i joined this forum, cmf member scomac was already doing these expertly.

a half-gambit consists of identifying which existing interlisted stock in one's account one might want to sell, or partly sell, for one reason or another. One must consider the capital gains/loss effect, of course.

one then decides whether it's more advantageous to sell on CAD side or on USD side. Depends whether one needs CAD or USD. One contacts the broker if necessary, to jockey the stock into position. Then, one sells.

very old tactic. Goes back at least to Marco Polo. I used to joke here that, when Polo reached the court of the chinese mongol emperor in the 13th century, the Great Khan was overjoyed. Because he realized that for the first time he could go long silkworms in asia while shorting them in venice ...

Edit: remember that if you are starting with a 100% all-america stock such as Merck or Apple in RRSP, you'd have to sell MRK or AAPL first, then buy an interlisted stock as the gambit carrier stock, then proceed onwards as above.


----------



## lh0628 (Dec 17, 2013)

is gambit trading just for currency exchange or for profit as well? 

Wouldn't one simply buy in DLR.U and have it journaled to DLR, or vice versa? I know you can do this with questrade, but may not with bank brokerages.


----------



## moisimplementmoi (Oct 20, 2014)

lh0628 said:


> is gambit trading just for currency exchange or for profit as well?
> 
> Wouldn't one simply buy in DLR.U and have it journaled to DLR, or vice versa? I know you can do this with questrade, but may not with bank brokerages.


 using highly liquid shares with a higher price tag can make the spread cost lower. obviously there is a market risk, in the 30 seconds it would take to set the transaction (at least at TDDI under the wash environment)...

also was able to do it with no human intervention. (which TD may charge higher fees for... seems to be hit and miss on that)


----------



## lh0628 (Dec 17, 2013)

I see, so with the same CUSIP number, you are selling the particular 1000 shares of RY in USD that you just bought using CAD? Netting zero shares but effectively exchanged your money from CAD to USD?


----------



## moisimplementmoi (Oct 20, 2014)

lh0628 said:


> I see, so with the same CUSIP number, you are selling the particular 1000 shares of RY in USD that you just bought using CAD? Netting zero shares but effectively exchanged your money from CAD to USD?


yes. last time i did it was with TD, before the split so around $100/share, which had the lowest spread as %. might use RY next time as highlighted by Humble_pie.

so you do have some market risk, in the time period, there is also risk of losing connection (which would be scary) etc, whereas DLR your exchange rate is set once you bought it, so you could wait days ...


----------



## humble_pie (Jun 7, 2009)

moisimplementmoi said:


> also was able to do it with no human intervention. (which TD may charge higher fees for... seems to be hit and miss on that)


100% online gambit trading at TD is only possible in RRSP & TFSA accounts.

in cash & margin accounts the trading platform will block the sell order. This order has to be phoned in to a licensed rep. The present fashion at TD is apparently to generally or usually apply the web commish; however the policy is not written anywhere & apparently each representative is free to charge the commission of his choice.

over the past few years, though, the TD has generally charged an agent-handled phone commission. This is why the DLRs were invented as an ETF by horizons betaPro. DLR.U is pegged. The buyer of DLR instantly obtains a fixed exchange rate. Therefore any broker waiting period for settlement & journalling stock does not matter.

please note that this happy circumstance does not work in reverse. Only DLR.U is pegged.

please note also that the DLRs have bid/ask spreads that include modest MER fee plus profit for the fundco. I don't ever use DLRs myself.

it is believed, although not known for sure, that the new dual-currency RRSPs & TFSAs will also require phone calls to a representative for a gambit sell side order.


----------



## moisimplementmoi (Oct 20, 2014)

humble_pie said:


> it is believed, although not known for sure, that the new dual-currency RRSPs & TFSAs will also require phone calls to a representative for a gambit sell side order.


actually this was confirmed to me by at least 3 reps. all said you would be charged higher fee, but who knows...


----------



## lh0628 (Dec 17, 2013)

Did not know this. Thank you. I will remember to use this method to exchange funds in the future.


----------



## moisimplementmoi (Oct 20, 2014)

lh0628 said:


> Did not know this. Thank you. I will remember to use this method to exchange funds in the future.


again, like anything make sure you understand the risks. DLR only has spread risk. using an interlisted stock has more risks.


----------



## pastorash (Feb 3, 2014)

So... staying with Scotia then are you?


----------



## warp (Sep 4, 2010)

humble_pie said:


> yes & yes & yes & yes & yes. I have arbed in the opposite direction. It works perfectly.
> 
> remember, too, that you can always do what i call a "half-gambit." When i joined this forum, cmf member scomac was already doing these expertly.
> 
> ...



Ok Humble , my fine man.

Just for clarification, please explain what you mean by "jockey the stock into position".
Do you mean if you hold interlisted Canadian stocks, that you purchased in the US with US dollars?...which you now wanted to convert to Canadian dollars?

I own lots of US stocks, all bought with US dollars...but none are interlisted. If I want to own a Canadian stock..I buy it in Canada, with Canadian dollars.

When I sell a US stock, I sell and get US dollars...that's when I may want to convert back to Can dollars, and save on forex fees/

warp


----------



## humble_pie (Jun 7, 2009)

warp the time has come to add a prism to the looking glass & realize that you can buy or sell interlisted canadian stocks in canadian market plus you can buy or sell those same interlisted stocks on US market, according to whether you have excess funds in one currency or whether you need more funds in that same currency.

also according to whether you think one of the currencies will rise while the other falls. Or fall while the other rises.

see, instead of having 2 pots going on the stove, now you have 4 pots. All filled with variations of the same soup.

add a few options & you can quickly get up to 12 or 14 pots going, all slightly different but all made from the same vegetables.

now the fun begins each:


----------



## Sasquatch (Jan 28, 2012)

pastorash said:


> So... staying with Scotia then are you?


Yeah, I think I will. 
At the end of the day they were pretty fair and I'm really too lazy to change around everything, including all our investments, anyway


----------



## moisimplementmoi (Oct 20, 2014)

Following Sasquatch process, which went from "i'm out of here" to "i think i'll stay" , i am trying to reconcile my desire to leave TDDI, and ask myself "will i be happier elsewhere?" 
is inertia the best practice? TDDI doesn't really care if i stay or go, so there is no message to send. Went deeper in seeing if RBI-DI would fit, all looked fine until we got to "yeah there is no easy way for you to get money to your bank account, if not with RBC, and yeah we still send all our tax receipt by mail (not really good if i go travelling next year)" ... but i hate inertia.... all i want is a simple process...


----------



## Eclectic12 (Oct 20, 2010)

^^^^

I can't comment on the money transfer part as my co-worker at RBI-ID also has a bank account.

However ... I'm sure I can recall him saying he was receiving electronic tax info, same as I receive with TDDI. 
I will ask next week to confirm.


Cheers


----------



## Sasquatch (Jan 28, 2012)

moisimplementmoi said:


> Following Sasquatch process, which went from "i'm out of here" to "i think i'll stay" , i am trying to reconcile my desire to leave TDDI, and ask myself "will i be happier elsewhere?"
> is inertia the best practice? TDDI doesn't really care if i stay or go, so there is no message to send. Went deeper in seeing if RBI-DI would fit, all looked fine until we got to "yeah there is no easy way for you to get money to your bank account, if not with RBC, and yeah we still send all our tax receipt by mail (not really good if i go travelling next year)" ... but i hate inertia.... all i want is a simple process...


I wouldn't be too sure about that.
One or two lost customers may not seem to be a big deal but their profits depend on having access to our money and they know it well.
It's just like politics, where folks think or say that their vote doesn't matter. 
Well, we've seen lots of examples where a candidate won or lost by a dozen votes or so.
EVERYONE COUNTS in some way or another :cheerful:


----------



## warp (Sep 4, 2010)

humble_pie said:


> warp the time has come to add a prism to the looking glass & realize that you can buy or sell interlisted canadian stocks in canadian market plus you can buy or sell those same interlisted stocks on US market, according to whether you have excess funds in one currency or whether you need more funds in that same currency.
> 
> also according to whether you think one of the currencies will rise while the other falls. Or fall while the other rises.
> 
> ...


Humble, my adventurous friend,

I appreciate your time and efforts on my behalf, but please reply in plain old English.

Hers'e the deal: I know you can buy and/or sell interlisted stocks in Canada or New York and in either currency.
I have been at this for a while.

I am only interested in how I can convert all of my lovely US dollars into Canadian Loonies at the least possible cost to me. Simple.

At some point, perhaps years from now, I will sell some or all of my US stock holdings, in my US Dollar account, and will have lots of US DOLLARS. These will have to be converted back to Canadian Dollars at some point as well, ( though I may give my US dollars to family members, as gifts)

Show me the path, lead me into the light as to how to convert from US to Canadian at the least cost.

Thanks.


----------



## moisimplementmoi (Oct 20, 2014)

warp said:


> Humble, my adventurous friend,
> 
> I appreciate your time and efforts on my behalf, but please reply in plain old English.
> 
> ...


not Humble ... So what you will do, is take all your US$, and buy the share of a company that is listed on the NYSE, and Also on the TSX. Let's call them TD.

So you go on the NYSE, and buy as many shares at TD as you can with your US$... go crazy.... Then if you are lucky enough to have a dual currency brokerage you DUMP TD immediately on the TSX, and Sell Sell Sell.... (if not dual currency, you would have called your broker first, while on line done the NYSE part, and then ask them to do the TSX part..... ) 

by the way this has a bit of market risk, TD could falter in the few seconds between the 2 transactions.


NOTE... since the purchase won't likely be exactly the same as how much you have in US$, any leftover should be send to the humble_pie preservation fund.


----------



## humble_pie (Jun 7, 2009)

warp i tried so hard (sob)

i wrote you an entire tiny micro-manual, tailormade just for yourself & the bimmer

it's like i said, to convert USD to CAD online at BMO, just buy an interlisted canadian stock on new york & sell it on toronto

there are a bunch of How-To details upthread, messages 41, 43, even 45

still having trouble? next suggestion: call a BMO agent you know & like, ask him or her to walk you through the entire procedure. First make sure he'll only charge the 2 web commish, though.


----------



## warp (Sep 4, 2010)

humble_pie said:


> warp i tried so hard (sob)
> 
> i wrote you an entire tiny micro-manual, tailormade just for yourself & the bimmer
> 
> ...


Humble, ( and moisimplementmoi )

Thanks your your reply....and it was in easy to read english!

I was thinking, in fact of calling a rep to ask questions. I have learned that you can never know too much, and asking even stupid sounding questions can bring very satisfactory results.

My Brokerage guys like me so much they may even charge me only one commish, when/if I do this.


----------

