# Need for Euros



## PuckiTwo (Oct 26, 2011)

﻿I would be interested in your opinion on this: we are thinking of buying a small property in Europe in about 6 months, approx. Euro 50k. We would have be very cautious not to lose too much on currency exchange as the amount would have to come out of our retirement savings and we do not want to borrow money as it would be too expensive.

Presently, the Euro vs. CAD$ exchange rate is very favourable. OTH, if we buy Euros now (as long as they are cheap) they will sit there and not create any income for at least 1/2 year. It seems that Europe is slowly making steps in the right direction to improve the financial situation. Also, with the American election, fiscal cliff, and whatsoever coming up European problems may not be so much.in the limelight and investors turning again to Euros away from the US$ which would raise the Euro vs the CAD$. The Euro improved against the CAD$ in the last week by several cents and since QE3 even more.

What do you think? Buy Euros now or leave the canadian $$ invested until we need the money?What is your take on the European situation? Any of your comments are highly appreciated. P.


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## Argonaut (Dec 7, 2010)

Are you "thinking" about it or actually going to do it? If you are, then you can buy half now and half later and you should feel good about not getting stuck wholly with the worst rate out of the two.


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## PuckiTwo (Oct 26, 2011)

Argonaut said:


> Are you "thinking" about it or actually going to do it? If you are, then you can buy half now and half later and you should feel good about not getting stuck wholly with the worst rate out of the two.


If nothing interferes, as of now it is a firm plan to diversify our investment in case things go down the drain here. Your idea is interesting, let me mull it around and calculate what that actually would mean.


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## Sampson (Apr 3, 2009)

Is there a way to 'gambit' this?

You could get your CAD to USD using the 'traditional' gambit, then find a NYSE to CAC 40 or other European exchange with a cross-listed holding to get USD to Euros.


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## PuckiTwo (Oct 26, 2011)

Argonaut said:


> Are you "thinking" about it or actually going to do it? If you are, then you can buy half now and half later and you should feel good about not getting stuck wholly with the worst rate out of the two.





PuckiTwo said:


> If nothing interferes, as of now it is a firm plan to diversify our investment in case things go down the drain here. Your idea is interesting, let me mull it around and calculate what that actually would mean.


A conservative annual gain of 4% on our Canadian investment translates into a loss of less than $1400 if we bought 50% of the Euros needed now. If the Euro rose in the next 4-8 months more than 0.04-0.05 cts we would be ahead and it would be preferential if we bought the Euros now. If the Euro stays the same as of now or slides further from its present value there would be no gain cashing our investments and buying Euros. There would only be a gain if the Euro really took off in the next 1/2 year. But it would be very counterproductive if the Euro slid further. 

It’s not so much what makes us feel good, it is also that we want to make an educated decision based on the assessment what may happen: will Europe recover short-term (4-8 months) or will the problem solving take so long that the Euro stays depressed? Where can I find predictions on the European situation? There was a lot of talk on CMF about the impact of Europe being a financial disaster and I am interested what members think now? Is the European disaster all over? And if not will the North American markets ignore Europe because they concentrate on the US disaster?



Sampson said:


> Is there a way to 'gambit' this? You could get your CAD to USD using the 'traditional' gambit, then find a NYSE to CAC 40 or other European exchange with a cross-listed holding to get USD to Euros.


I thought about that too but didn’t think that I needed to gambit 2x but it certainly would save a lot of money. In 2008 Deutsche Bank cross-listed 6 Exchange-Traded Notes on the TSX. Don’t know if that was between TSX and NYSE or TSX and Dax. Rather than going CAC40 I would look at LuxX, SIX or DAX unless TSX has cross-listed holdings with France due to the Quebec connection. 

I have no idea where to start, just heard about gambitting only from CMF; never done it myself. The TSX/NSYE gambit I can possibly learn from this forum but the one with overseas would be tricky/scary. Who would I approach and what would I look for, what would I ask? What would I need?


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## Sampson (Apr 3, 2009)

Doesn't matter which exchange as long as it is traded in Euros and also listed on the TSX.

You'll need to make sure you have an account with a brokerage that allows direct holding of European stocks. Of Canadian banks, I don't think any of the big 5 allow this, not certain though.

HSBC on the other certainly can do this and has a decent presence in Canada.


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## Argonaut (Dec 7, 2010)

I don't think gambitting is going to be possible, no brokerages allow customers to hold Euros that I know of. I remember from working at the bank, some people had Euro accounts but they were basically "invisible" and hard to deal with. But as far as selling a European stock and getting Euro dollars for it, the logistics might not add up that way.

In the end, you're basically asking "where is the Euro going to be on x-date?" and nobody knows that, not even professional currency traders. If they do, they can make a billion like George Soros but they won't tell you. If you want an educated guess, I would say the Euro rallies through October and then pulls back after that. This advice is worth as much as you paid me for it though.

I'm a bit skeptical of the whole thing unless you really want to live in Europe part time. As far as things going down the drain here, I just don't see it in comparison to across the Atlantic. Canada is very stable.


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## Sampson (Apr 3, 2009)

HSBC can do it, but it looks like commissions are 0.4% for 50,000 Euros. There may be additional fees and journaling may not be instant, and therefore you expose your to market risk.

http://www.hsbc.ca/1/2/en/personal/...ssion-global-trading/global-trading-uk-europe


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## Argonaut (Dec 7, 2010)

Yeah but the question is, can you actually withdraw that as Euro dollars from the bank after "gambitting". There has to be a placeholder section of the account for these monies, something that some bank brokerages even have trouble with when it comes to USD.


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## Sampson (Apr 3, 2009)

but HSBC allows for savings accounts in all sorts of currencies, euros incl.


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## Argonaut (Dec 7, 2010)

You cannot buy or sell stocks from a bank account, though. HSBC brokerage would have to have a Euro slot and I don't know that it does. Best way would be to ask them I suppose. This is new territory, I've never heard of a Euro exchange done by gambit.


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## Sampson (Apr 3, 2009)

The withdrawl shouldn't be an issue, especially since the OP will be using the money in Europe and I guess would try to withdraw from there.

I know HSBC has accounts whereby you can put money in the Canadian account, and take it out at an Asian location, Hong Kong, and China at HSBC branches there. I assume they would allow this for Europe, but obviously best to sort it out first.

The question I would have is whether they would allow the journaling across TSX/NYSE listed stock over to a European exchange. Getting the money (euros) out shouldn't be too much of an issue, but yeah new territory. It's never been discussed on this Board from what I know, nor have I seen it elsewhere, doesn't mean it's not conceptually or in practice undoable.

I've always wondered how to get access directly to foreign exchanges and currencies, maybe this is the way, with a truely international bank.


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## humble_pie (Jun 7, 2009)

there are a number of problems with even the notion of CAD/euro gambits & argo is doing a good job pointing these out imho.

no one in cmf forum has ever done a euro gambit. Pros arb stocks across the ocean all the time, but my belief is that no discount broker serving retail clients has anything like the networked trading platform(s) that will permit clients to gambit instantly & seamlessly between toronto or new york & the big euro exchanges. Certainly not for cheap online commissions.

all bank-owned discount brokers offer overseas trading by phone. It would be possible by phone order to carry out a trans-atlantic gambit. Commissions are steep, starting at $150 last i heard (agent-handled trade).

also - last i heard - td waterhouse has more extensive online global trading than hsbc, which used to offer only london & hong kong trading, although it may have expanded now. TDW also has a subsidiary in luxembourg whose mandate is serving offshore mostly canadians, so this would probably lead to the banking network that argo is calling for.

but the issue then becomes: Folks with extensive/frequent FX needs should probably open an Interactive Brokers account in order to benefit from IB forex trading. I hear it's marvellous. The best FX rates anybody will ever see. I don't know anything about the IB system for delivering euros or pounds or swiss francs to clients who are already stationed in europe, though.

plus IB doesn't like dormant accounts, there's a $10/month minimum charge, so account should be for active FX traders.

in summary, i think argo is very right in cautioning Pucki about pitfalls lurking in this intergalactic-route-where-nobody-has-ever-gone-before & i hope she will not boldly go there.


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## Square Root (Jan 30, 2010)

if you like the current exchange rate and are certain you will need the Euros, consider buying a forward FX contract. It is a contract to exchange CDN$ for Euros at a specified future date and exchange rate. You will need to post some collateral but not much. The interest rate differential between the two currencies will be built into the exchange rate. You will get to keep most of your CDN$ invested over the forward period. Your bank should be able to do this for you without any special accounts. 
i did this when we bought our home in Arizona and it allowed me to lock in the favourable rate and eliminate exchange risk over the period to close.
The arbitrage ideas mentioned seem far fetched and too risky IMHO.


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## Sampson (Apr 3, 2009)

humble_pie said:


> in summary, i think argo is very right in cautioning Pucki about pitfalls lurking in this intergalactic-route-where-nobody-has-ever-gone-before & i hope she will not boldly go there.


It's too bad no one has any experience with HSBC to confirm/deny.

I am certain one can trade Hong Kong and London directly online, but other markets? dunno. The fact that they allow for savings accounts in most major currencies seems promising that they would also support online transactions in those currencies, but this is all conjecture. Interactive brokers could obviously be a solution, but again, a firm where there seems to be a 'limited' amount of experience from our forum members.

Does anyone know what banks charge for CAD:Euro conversions anyway? similar to CAD:USD rates?


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## humble_pie (Jun 7, 2009)

london & hong kong markets don't deliver euros.

the point is that no. broker. has. online. trading. network. that. is. capable. of. arbitraging. CAD/USD. into. euros. or pounds. or. any. other. offshore. currency. seamlessly. instantly. with. cheap. online. commissions.

tdw has online global trading but platform does not permit live arbitrage.

IB has global trading but an IB client will do much better Forex trading, not going through some stock arbitrage rigamarole to obtain his offshore currency.

clients at any bank-owned broker can phone an arbitrage operation in. The commish will be steep & the procedure will probably be slow & arduous, one step at a time. Delays at any stage could open risk windows. Not worth it imho.


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## PuckiTwo (Oct 26, 2011)

HP, Argo, Sampson & Square Root: Thanks to all of you for the wealth of food (for thought and action). Lots of ideas to research. Will definitely contact HSBC & IB as well look into Square Root’s suggestion to buy a forward contract.

- The HSBC Direct site mentions that they offer online trading with Paris (CAC40) and Frankfurt (DAX). Will find out.

- Bank charge for CAD/Eur conversion rate: as an example: mid point /Euro cross as per Sep 14 is 1.27466 bank charges (client buys/pays Canadian) 1.313000 (Scotiabank). But we have also paid spreads of 0.10 cts. Charge can be somewhat negotiated depending on the amount to be exchanged. In the "real world" the banks compete with their fx rates offered to the customer off the street, not here. RY = BNS.

Square Root: In your case was the exchange rate for the forward contract based on the spot/cross rate + an fx fee or was it based on the client-buys/pays canadian bank charge. 

We have a Euro account in Canada with Scotiabank and will investigate if we can transfer Euro 50k there without triggering FX. Argo is right, these accounts are absolutely “invisible”. So much that the tellers at the local branch get jitters if we want to pay bills in Europe. You can’t even do Euro business in one branch and have the account at another. 

Argo+HP: Thks for cautioning. Not to worry, I am a cautious person with a streak of adventure. I find this discussion exciting and hopefully I can come back to cmf with some findings - simply don't expect expert language! P.


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## humble_pie (Jun 7, 2009)

pucki if you don't mind my asking, are your brokerage accounts at scotia also ?

i ask because it seems to me you already have a good foot in the door, with your euro account at scotia which you actually do use.

another factor that would help is that you'd probably have plenty time to plan everything properly (that's what a smart cautious person with a streak of adventure would do.)

very roughly, i'm calculating that the FX fee on 50,000 at the spread you've just quoted would be something like $1850-2000 for scotia.

you *could* - theoretically speaking - carry out a gambit operation at your broker by buying the north american side of an interlisted security here in CAD or on new york in USD.

the choices in CAD must be very slim. I don't know deutschebank securities here on toronto, you'd have to make sure both markets are as liquid as possible. The problem with thinly-traded securities on all exchanges is that the B/As tend to be huge.

another currency arb candidate might be something like ING bank in new york (it's an adr) plus ING bank on euronext in amsterdam, i think its symbol there is IN.

the important point is that, regardless of what the carrier stock would be, you'd have to phone that sell order in. The commish would be considerably higher than an online commish, but if FX fees are $2000, then even a $200 commish looks great.

it's a fact that bank-owned discount brokerages do have access to additional services, often coming from their full-service or institutional side, which they can make available to clients even though they don't advertise them.


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## PuckiTwo (Oct 26, 2011)

humble_pie said:


> pucki if you don't mind my asking, are your brokerage accounts at scotia also ? i ask because it seems to me you already have a good foot in the door, with your euro account at scotia which you actually do use.


﻿Our investments are with another bank brokerage, with a FA but are moving away from that brokerage to a DIY (another story another time). DIY will be TDW. You mentioned that TDW has a subsidiary in Luxembourg - I will investigate that. LuxX has been internationally oriented for decades, its proximity to EU in Bruxelles, was 30-40 yrs ago a safe haven but lost somewhat its glamour. Will see what TD can do.



> another factor that would help is that you'd probably have plenty time to plan everything properly (that's what a smart cautious person with a streak of adventure would do.)


﻿don't know about smart but research and planning comes first. Especially, as all this stuff sounds like kisuaheli to me I have to be particularly careful.



> very roughly, i'm calculating that the FX fee on 50,000 at the spread you've just quoted would be something like $1850-2000 for scotia.
> you *could* - theoretically speaking - carry out a gambit operation at your broker by buying the north american side of an interlisted security here in CAD or on new york in USD.
> the choices in CAD must be very slim. I don't know deutschebank securities here on toronto, you'd have to make sure both markets are as liquid as possible. The problem with thinly-traded securities on all exchanges is that the B/As tend to be huge.
> another currency arb candidate might be something like ING bank in new york (it's an adr) plus ING bank on euronext in amsterdam, i think its symbol there is IN.
> the important point is that, regardless of what the carrier stock would be, you'd have to phone that sell order in. The commish would be considerably higher than an online commish, but if FX fees are $2000, then even a $200 commish looks great.


﻿I agree with the $200 commish vs $2000 fx fees. The probably naive question I would ask is do I need to go TSX-NewYork-Europe or can it be done directly TSX - Europe? Need to ask the banks and sources you all gave me some questions first and then may have to come back to the forum for help so that I understand correctly.



> it's a fact that bank-owned discount brokerages do have access to additional services, often coming from their full-service or institutional side, which they can make available to clients even though they don't advertise them.


Not ours, I checked that in the past. Don't know if it is our broker or the brokerage. That's ok, we will find one solution.
HP, thanks a lot. P.


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## Square Root (Jan 30, 2010)

In my case the rate was negociated as the amount was large. i recall I got about Bloomberg mid point plus 60bps. I pulled the trigger when I was able to get a rate that was better than par. They price these FX forwards by adding or subtracting "points" based on the differential in interest rates between the two currencies and time to settlement. On e50,000 I doubt you would get a good rate. But your major risk isn't so much whether you get a "good" rate but rather that rates move significantly against you in the period up to close. Rates could easily move 5-10% over a six month period. A known cost (say 1.5%) is much better han the possibility of a larger unknown cost IMHO.


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## PuckiTwo (Oct 26, 2011)

Sampson said:


> It's too bad no one has any experience with HSBC to confirm/deny. I am certain one can trade Hong Kong and London directly online, but other markets? dunno.





humble_pie said:


> london & hong kong markets don't deliver euros. tdw has online global trading but platform does not permit live arbitrage.


At TDW you can trade online directly in Bruxelles, Madrid, Milan, Amsterdam, Paris, Frankfurt (all EU) as well do online currency conversions. Anybody interested, here is the link www.tdwaterhouse.ca/products-servic...lectronic-services/features-functionality.jsp.The TDW rep I talked to could not give me the current cad$/Euro spread over the phone. I am opening a global trading account, there is a training section which I will explore. Am also investigating other options.


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## Sampson (Apr 3, 2009)

So it may well turn out to be an 'assisted' arbritrage or 'gambit'.

It'll certainly still be cheaper than the direct conversion, maybe you need to find the brokerage that offers that cheapest transactions to benefit most? Please keep us posted and good luck in exploring new ground.


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## humble_pie (Jun 7, 2009)

i don't believe this is going to work at tdw.

the big green says it won't journal shares from any north american account to any global trading account where they could be sold for euros.

rep to whom i spoke said that all shares purchased through global trading *must* be sold on the same exchange whence they came.

no amount of "assisting" can cause shares to leap the pond.

i benefited from interesting discussion with one of my fave reps. We - she & i - could not think of any true "interlisted" securities to begin with. ADRs for complex reasons having to do with their registration in new york city are not transmutable into the original underlying shares by any organism other than the ADR manager & the giant institutional brokers with whom it carries on business. Offhand we could not think of any company with precisely identical shares interlisted between toronto & a european exchange such as euronext in amsterdam. Usually overseas shares are a different class.

(pucki it's true you can sell shares through tdw global trading on european exchanges; but in all cases you'd have to buy those shares on that exchange first & pay for them with the relevant currency.)

(also watch out for those tsw global trading "online currency conversions" that you mentioned. Those are going to have healthy FX fees. They are intended to be profitable for the broker.)


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## PuckiTwo (Oct 26, 2011)

humble_pie said:


> i don't believe this is going to work at tdw.the big green says it won't journal shares from any north american account to any global trading account where they could be sold for euros. rep to whom i spoke said that all shares purchased through global trading *must* be sold on the same exchange whence they came. no amount of "assisting" can cause shares to leap the pond. i benefited from interesting discussion with one of my fave reps. We - she & i - could not think of any true "interlisted" securities to begin with
> (also watch out for those tsw global trading "online currency conversions" that you mentioned. Those are going to have healthy FX fees. They are intended to be profitable for the broker.)


I found out the same thing - had a very nice/knowledgeable rep. For those who are interested, you can do two things 
1. Open a TDW Global Trading acct, needs to be funded. If you want then to buy a piece of Mercedes (Daimler-Benz) or Peugeot you can buy stk directly at DAX Frankfurt/Germany or CAC40 Paris/. The stk will be bought in Euro. If you originally funded yr account with CAD$ there will be a conversion in the process the moment you buy the stk. 
If you then sell the stk again it will be sold on the exchange you bought it from (DAX/CAC40) and the cash sits there as Euro. If you want to withdraw the cash in Euro they will send you a bank draft. 
This is the part I was interested in but she did not want to tell me what the fx fee or the spread between spot and their sell price is. In order to see their spread I would have to open a Global Trading account - isn't cagey? I find that hard to believe that TDW cannot/does not want to give out how much they charge for that. It's probably outrageous.
2. The alternative she suggested was a straight currency conversion. Fund the Global Trading acct with CAD$, convert to Euro at your preferred rate. You can buy the stk later. Again, I am very interested in their charge - there must be a way to find this out without starting 3 or 4 Global Trading accts. 

I also investigated TDW in Luxembourg. They are interesting to Canadian/US Expats and that's why I am posting it here:
TD Affiliate is INTERNAXX http://www.internaxx.lu/internaxx/get-started/help/call-or-email-us. Apparently does not serve Canadian or US residents????
However, if any of you are registered in Europe they will serve you. Provide stock trading, Forex and Futures Trading. Charge 0.6-0.7% on currency conversion CAD$/Euro (based on 50k Euro).

I am still investigating HSBC and IB. Will post here as soon as I know more. 


Sampson said:


> So it may well turn out to be an 'assisted' arbritrage or 'gambit'. It'll certainly still be cheaper than the direct conversion, maybe you need to find the brokerage that offers that cheapest transactions to benefit most? Please keep us posted and good luck in exploring new ground.


Looks like we are out of luck:upset:


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## Square Root (Jan 30, 2010)

Like I said, buy a forward contract and lock your rate in if you think the rate is moving against you. All the other stuff is very doubtful.


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## humble_pie (Jun 7, 2009)

square root these other strategies are doubtful to you because you don't do them; but i don't think it's fair for you as a non-practitioner to judge them all as "very doubtful."

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.


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## Ethan (Aug 8, 2010)

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.


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## Sampson (Apr 3, 2009)

humble_pie said:


> square root these other strategies are doubtful to you because you don't do them; but i don't think it's fair for you as a non-practitioner to judge them all as "very doubtful."
> 
> 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.


Thanks for the 2 of you for looking in and calling your reps, although I suspect pie has a crush on the TDW rep and calls in for any chance to chat.



humble_pie said:


> anyone with frequent & repeated needs for offshore currencies might want to look into IB for this reason. It might suit Pucki to a Tee.


This certainly would only be applicable for mid- to large sized transactions $50,000+ since the annual fee etc would really weigh down on the casual, once or twice per year user.

It's all electronic, you would think they could do this, but I guess they will deny service if they can continue to collect on the fat lucrative FX fees.


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## humble_pie (Jun 7, 2009)

thank you also sampson for raising the idea of overseas currency gambitting. It appears to be an idea whose time has not yet come, but it certainly was intriguing & well worth exploring.

btw i don't think the IB minimum monthly charge is such a barrier. At the euro FX rate pucki was being charged above - the spread was .03834 - one single exchange of $4000 would easily pay for IB's $10 minimum per month. This fee is also reduced by trading commissions each month, until, for most clients, it does not exist at all.


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## Square Root (Jan 30, 2010)

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.


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## PuckiTwo (Oct 26, 2011)

Square Root said:


> 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.



Ethan said:


> 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. 



humble_pie said:


> 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.


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## PuckiTwo (Oct 26, 2011)

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.


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## humble_pie (Jun 7, 2009)

PuckiTwo said:


> * 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 ...


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## m3s (Apr 3, 2010)

humble_pie said:


> 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.




PuckiTwo said:


> *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.
> ...



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.


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## PuckiTwo (Oct 26, 2011)

mode3sour said:


> 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.


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## m3s (Apr 3, 2010)

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


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## humble_pie (Jun 7, 2009)

but U should check out the cost of those wire transfers
pretty steep :biggrin:
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 ... ?


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## m3s (Apr 3, 2010)

€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..


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## PuckiTwo (Oct 26, 2011)

*CHF/Euro*



humble_pie said:


> (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


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