I have been trading currencies for years now but always using only one currency for all of my trading – the USD. In the future – possibly not-too-distant future – I am hoping to take a significant amount of USD from my forex broker and buy CAD with it.
Can anyone advise me how I could get the best possible rate? Obviously, I could use one of my own banks but I want to be sure that if I am buying several hundred thousand dollars worth, that I am getting the best possible exchange rate with the least amount of surcharges. Each and every time I have asked this question, I seem to get nowhere.
First, it’s important to confirm: Is your goal ultimately to spend Canadian dollars or US dollars?
In other words, do you want to speculate on the value of the Canadian dollar, or is your goal to use Canadian dollars to make another purchase in that currency?
I am a Canadian currently living in Canada. My entire forex trading account is in USD. At some point, I want to take that USD and buy CAD with it so that I can use it here in Canada. Obviously, I will try to do so when the USD is most powerful. I also want to know what vehicle I can use to make this transaction or transactions when the time comes.
So to answer your question directly… I am planning to spend CAD, not USD. For example, I may want to invest in property or a business. I will need to do so in CAD.
I am currently waiting on 2 things: (a) for my forex account to reach my goal and (b) for the USD to gain great strength vs. the CAD.
How is that going to guarantee I get the best possible exchange rate with the least service charges? If I am converting a few hundred thousand dollars, a small % in rate can make a huge difference to the bottom line.
All you can do is watch the exchange rates, keep an eye out for anything that may influence it one way or the other, and transfer it.
There are no guarantees, rates could go against you for months or could change direction any time.
Keep an eye on the oil price. As a huge exporter of oil to the USA, USD/CAD is affected by any sizeable or sustained movement in the price of oil.
eddieb: I understand that as I have been trading currencies for nearly 10 years. I am looking for the best vehicle to use to convert USD to CAD. I am not even sure if the rates would be the same across the board. For example, if the USD/CAD rate on FXDD is 1.2975, it could be 1.2925 elsewhere. I am trying to figure out which financial institution has the most favorable rate with the least service charges. Like I said, a small percentage can make a huge difference when you’re dealing with several hundred thousand dollars.