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Old 07-26-2015, 03:17 PM   #11
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We are planning on having the funds wired from a Vanguard brokerage account. They will convert to Canadian dollars and don't charge an fees. I checked the exchange rate they would use a few weeks back and it was very very close to the spot rate you will find online, so it wasn't inflated to make up for the lack of fees.

Also, if you already have the money, you can "lock in" the rate by purchasing FXC in your brokerage account. This is a Canadian Dollar ETF (exchange traded fund). If the exchange rate gets worse between now and when you wire the funds, you will make it back by a corresponding gain on your FXC holding, although you will have to pay capital gains tax on the gain. Of course if the exchange rate continues to improve you won't benefit from the better rate because your FXC holding goes down by the same amount.
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Old 07-26-2015, 03:54 PM   #12
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Quote:
Originally Posted by Ralph & Paulette View Post
Also, if you already have the money, you can "lock in" the rate by purchasing FXC in your brokerage account. This is a Canadian Dollar ETF (exchange traded fund).
You lock in the rate in your brokerage account. The rate you get with ETI is based on the date/day they get your money and it's deposited. Your account and ETI are completely separate things.
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Old 07-26-2015, 04:07 PM   #13
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Right, hope I didn't confuse anybody with that. Technically it is a hedge. Your ETF will go up or down in value by the same amount as ETI 's exchange rate (or in my case Vanguard's). So, except for a possibly small tax liability from the sale of the ETF, you won't have to come up with additional $$ if the exchange rate is worse when it comes time to pay.
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