How to hedge exchange rate?

[Loren & Cathy]

Originally Posted by Mary F

Yes, but what about folks who pay way ahead of time and then have a change of circumstance, and need to get their $$,$$$ back or sell a trailer that hasn't even started production yet? Do they sell their build slot? (That could get weird very quickly.) Wait 'til their trailer is built and then sell it? The problem with just taking a refund is if US/CAN currency exchange is involved, the conversion could mean $$$$ lost. I dunno I can see both sides of the issue...

Yes, that did happen and ETI went out of their way to keep the original purchaser from losing a lot of money due to the volatile exchange rate. I guess the rules have changed because if a situation changes, it can be a big headache for all parties concerned. And besides, a couple of months out is one thing but over a year out is another. Loren

[LJY]

Originally Posted by Rossue

Any decent brokerage firm can help you in the US.

Are you referring to a forex brokerage? or stock?

[Greg A]

It's all so Loonie to me......

[JohnB]

Originally Posted by Greg A

It's all so Loonie to me......

Well Toonie in tomorrow, the show might get better!

[Jim Bennett]

Originally Posted by LJY

How to hedge exchange rate

Originally Posted by Mark&Elaine

They suggested I open a Canadian bank account. I assume to exchange US dollars to Canadian at today's rate and hold the account open until you pay for the trailer.

This is just what I was going to suggest.

I did the same in reverse, I opened a US account with my bank a few years ago, to hedge against jumps in exchange rates. The only problem was, I only dumped $20k into it when it was at par. I should have put WAY more in, because it is now all gone, and exchange rates have not been too favourable for me to add to it again.

Originally Posted by Donna D.

Boy, that surprises me too. Since 99% of the trailers are custom built to owner specs, I'm surprised they'd wait that long... too many people back out at the last minute and ETI would be stuck. When I bought Ten Forward, ETI preferred final payment within six weeks of completion.

This is why they implemented the $2,000 deposit which is non-refundable once the trailer starts into production.

[Donna D.]

Originally Posted by Jim Bennett

This is why they implemented the $2,000 deposit which is non-refundable once the trailer starts into production.

$2,000 is nothing compared to the (perhaps) $28,000 + still owed at completion... if someone backs out.

[Jimrules]

Originally Posted by barry

I have a US dollar account at the Credit Union I deal with down the road, can those in the US not open a Canadian dollar account at their local bank or Credit Union and hold the money their until needed?

Barry

I just mentioned this on similar thread but since they are a Canadian bank I went to BMO and had no luck. They will open US dolar accounts in Canada but not Canadian dollar accounts in the US. They couldn't explain it, just company policy.

[Rossue]

Originally Posted by LJY

Are you referring to a forex brokerage? or stock?

Our brokerage firm Morgan Stanley bought some foreign currency for us then wired funds to UK when we needed to pay tuition. No additional cost to us. It is one of the services they provide to be competitive.

[Jim Bennett]

Originally Posted by Jimrules

I just mentioned this on similar thread but since they are a Canadian bank I went to BMO and had no luck. They will open US dolar accounts in Canada but not Canadian dollar accounts in the US. They couldn't explain it, just company policy.

Rather than going to a Canadian bank like BMO, could you not open a Canadian dollar account at your US bank? It kinda sounds like not, I just find that very surprising.

[thoer]

Originally Posted by Jim Bennett

Rather than going to a Canadian bank like BMO, could you not open a Canadian dollar account at your US bank? It kinda sounds like not, I just find that very surprising.

One of those many surprising things about your southern neighbors, eh? Heck, when we were heading off on our latest Viking River cruise I couldn't even find a local bank that had any Euros so we could have some for when we landed. Once coming home from Ontario I still had some CAD left and once we were more than about 50 miles from the border banks didn't want to exchange them for USD for me.

[Jim Bennett]

Originally Posted by thoer

One of those many surprising things about your southern neighbors, eh? Heck, when we were heading off on our latest Viking River cruise I couldn't even find a local bank that had any Euros so we could have some for when we landed. Once coming home from Ontario I still had some CAD left and once we were more than about 50 miles from the border banks didn't want to exchange them for USD for me.

Come back and spend that money here then. We are a friendly bunch.

[thoer]

Originally Posted by Jim Bennett

Come back and spend that money here then. We are a friendly bunch.

I still have it, it just seems to be worth a lot less than when I bought it. Interestingly, with all this talk about locking in the low CAD values, it remember that when we bought our 17 that the CAD was worth more than the USD....

[steve dunham]

We are planning our annual fishing trip to Canada . I went to our local bank and they will exchange US dollars for Canadian dollars at that days exchange rate plus a flat fee. BUT I was warned to not purchase anymore Canadian dollars than I absolutely needed because they would not exchange Canadian dollars for US dollars.
They would not explain why but only said that was their policy.

[Jimrules]

Originally Posted by Jim Bennett

Rather than going to a Canadian bank like BMO, could you not open a Canadian dollar account at your US bank? It kinda sounds like not, I just find that very surprising.

I tried my credit union and some orther banks first and got nothing but blank stares. At least at BMO they understood what I was trying to do they just couldn't help me.

[thoer]

Originally Posted by Jimrules

I tried my credit union and some orther banks first and got nothing but blank stares. At least at BMO they understood what I was trying to do they just couldn't help me.

Kinda gives you the feeling that we expect the whole world to take dollars. Just like the rest of the world understands English if you just speak it very loudly.

[skyfree]

Originally Posted by Mark&Elaine

I also was told that ETI will not accept payment before the trailer is completed going forward.

Not sure if this is actually true because I asked the very same question yesterday and they said I CAN do it by wiring money directly to them, but only after the order is completely processed next week. Maybe they changed their minds on that one or either I or you spoke to the wrong person?

[Fiberglass Fan]

Originally Posted by thoer

I still have it, it just seems to be worth a lot less than when I bought it. Interestingly, with all this talk about locking in the low CAD values, it remember that when we bought our 17 that the CAD was worth more than the USD....

Good point!

The CAD$ in January hit the lowest it has been at in years..... BUT it has slowly started a comeback.

If it was me I would pay for the trailer now or at least buy myself some CAD dollars & put them in CAD$ account.

[Mark&Elaine]

Well, for me, to get the accurate information I intend to go to ETI as I have a trip planned already. Even if they do accept prepayment there still is the question wether it sound financially to do so. As I said, I will visit a bank in Canada to find out about opening an account. If you Google the process like I did, you will find that information is unclear and confusing.

[Fiberglass Fan]

Originally Posted by Jimrules

I just mentioned this on similar thread but since they are a Canadian bank I went to BMO and had no luck. They will open US dolar accounts in Canada but not Canadian dollar accounts in the US. They couldn't explain it, just company policy.

Have you tried HSBC?
They are an international bank which you may have more luck with them than a US only based bank or credit union. I held a US$ account with them here (in Canada) for a long time. Bit surprised BMO would not help you though.

[tdf-texas]

Originally Posted by Fiberglass Fan

Good point!

The CAD$ in January hit the lowest it has been at in years..... BUT it has slowly started a comeback.

The CAD to USD exchange rate is closely tied to the price of oil - as oil goes down, so goes the loonie. I expect the price of oil to drop this year as supply is still higher than demand and Saudi / Iran are not cutting supply.