Working with Canadian securities and currency for a US investor

[lschmidt]

Hello, everyone. I haven't been very prolific in posting, but I hope to ask for some gratuitous advice nonetheless.

 

I will be participating in a private placement for a Canadian security on an exchange (CSX) that my brokerage, Fidelity, doesn't work with. I've run into two interesting issues:

 

1) Fidelity will not hold CSX securities and certainly not restricted stocks (this placement will issue restricted shares). Is there any better method for holding this stock rather than holding stock certificates in my home file cabinet?

 

2) I will have to wire money for the placement and convert from $US to $CAD. If I wire through Fidelity and have them convert, I'm noticing that the exchange rate for fidelity is about 3% below the official spot rate (they said $1 CAD = 1.067 Canadian today). That means that Fidelity takes about 3% on the currency spread. My bank, Bank of America, takes about 4% on the currency spread. Is there any way to send money from the US to a Canadian bank with a currency conversion without essentially paying a 3% fee? Any better ideas?

 

I greatly appreciate any advice.

Thanks,

Mike

[Williams406]

Couldn't help noticing your 'lschmidt' handle with 'Mike' signature. I bet if you offered signed baseballs to someone in Fidelity's custody and currency departments, your two issues go away. I've been around the game a bit and have seen no greater third baseman.

 

Williams406

 

 

[redhots]

Hello, everyone. I haven't been very prolific in posting, but I hope to ask for some gratuitous advice nonetheless.

 

I will be participating in a private placement for a Canadian security on an exchange (CSX) that my brokerage, Fidelity, doesn't work with. I've run into two interesting issues:

 

1) Fidelity will not hold CSX securities and certainly not restricted stocks (this placement will issue restricted shares). Is there any better method for holding this stock rather than holding stock certificates in my home file cabinet?

 

2) I will have to wire money for the placement and convert from $US to $CAD. If I wire through Fidelity and have them convert, I'm noticing that the exchange rate for fidelity is about 3% below the official spot rate (they said $1 CAD = 1.067 Canadian today). That means that Fidelity takes about 3% on the currency spread. My bank, Bank of America, takes about 4% on the currency spread. Is there any way to send money from the US to a Canadian bank with a currency conversion without essentially paying a 3% fee? Any better ideas?

 

I greatly appreciate any advice.

Thanks,

Mike

 

Great questions!  I am interested too!

[Redskin212]

Is it possible for you to wire $US to the company for the private placement and have them convert it to Canadian dollars and send you the corresponding number of shares?

[lschmidt]

Yes, that's possible. But then I would be subject to the exchange rate of the Canadian bank, which may have a currency exchange spread worse than my bank (it's unknown).

 

 

Is it possible for you to wire $US to the company for the private placement and have them convert it to Canadian dollars and send you the corresponding number of shares?

[Redskin212]

I suggest you contact CIBC (the bank being used) to determine what rate they would use to exchange US to Canadian $.  I am sure Premier's attorney Marta Davidson (Marta.Davidson@rnllp.ca) can assist you with a contact person at CIBC.  Good luck and keep the board informed.

 

Reddskin

[CC]

I've used this method to convert at close to the spot rate in can brokerage accounts

 

http://www.moneysense.ca/invest/norberts-gambit-a-better-way-to-buy-u-s-dollars

 

http://canadiancouchpotato.com/2013/12/03/norberts-gambit-the-complete-guide/

 

 

But there are some risks in this  :(  I hope someone knows a better way :)