Trading US instruments from Canada

torontoman · May 31, 2005

I do the same as steeldust. I never convert to CAD unless I have to. Until then, it stays in US dollars.

the bouch · May 31, 2005

Well I checked with IB and if you open an account in $CAD and buy US stocks, they will convert the money to $USD to buy the stocks and then you can reconvert it back to $CAD once you get out of the position where you will lose the spread on the FX each time. So basically I am back where I started.

torontoman · May 31, 2005

I use TD Waterhouse. Never had a problem. It stays in USD unless you enter otherwise

cashola · May 31, 2005

A universal account does not convert the currency for a non base transaction. There is no exchange...if IB told you that then get it in writing and match it up against there own literature. You must have called Interactive Jokers

trend_guy · May 31, 2005

I second what cashola said again. If you buy XYZ on the TSX, you are basically getting a margin loan for the debit, when you close out that transaction the margin loan gets covered, if you make profit on the trade you have a credit balance in CDN dollars, if you lose money on the trade you have a debit balance in CDN dollars. Or vice versa for CDN $ accounts trading US securities.

mahram · May 31, 2005

personally I just leave all of my cash in american dollars, if your mainly a us trader. It became too much of hassle. Focus on the trading, and the research.

Quote from the bouch:

Say you want to trade US stocks and live in Canada, do most of you just leave the money in $USD and stay exposed to movements in the $US/CDN? Personally I hedge my money with the futures but it's not really a perfect hedge since I have to pay taxes on my gains, or get to save taxes on my losses.
Any ideas on other ways to do it?

B

joeyata1 · May 31, 2005

if you ahve an account with waterhouse how are you taxed on it? do you get a 1099 like in the states? does the canadian gov't get a report of your trades for tax purposes?

the bouch · May 31, 2005

Quote from mahram:

personally I just leave all of my cash in american dollars, if your mainly a us trader. It became too much of hassle. Focus on the trading, and the research.

Im mainly a US trader but live in Canada. I live on CAD$. I've been partly hedged the past few years the USD has dropped and it has saved me in the 6 digits. I don't consider it to be a hassle.

What's the point of focusing on your trading when the value of the money you are making is going in the toilet in $CAD terms?