23 Jul 2012 25 Comments
So it has been almost 2 months later (since I first posted about this method) that I can finally report back that this will work with RBC Direct Investing. After a dozen emails back and forward and a couple of phone calls, I was finally able to get someone to confirm that it will work properly; the majority of my email responses said that as a result of DLR.U trading on the CDN market, the proceeds will be paid out in Canadian dollars. This is definitely NOT what we want to accomplish! Anyways, the following is a step-by-step guide to convert CDN dollars to US dollars in your trading accounts with RBC Direct Investing.
- Ensure that your trading account has both a CDN side and US side.
- Purchase DLR on the CDN side of your account. The market is CDN and the proceeds will be in CDN dollars. Remember to put a limit amount in, as the trading volume for this is not very high.
- Call or email RBC Direct Investing to journal your shares from the CDN side of your account to the US side of your account. This can take up to 3-4 business days.
- Once the shares show up on the US side of your account, be aware that it will still show up as DLR, not DLR.U as you may expect.
- This is THE MOST IMPORTANT STEP. When you are selling, make sure you choose the US side of your account and that you are selling DLR.U, even though it is showing up as DLR. The market will still be CDN. You will notice that the proceeds show up as being CDN still, but as long as you have chosen BOTH the US side of your account and you are selling DLR.U, the proceeds will end up as being USD. You will also get a warning that will pop up saying that your trade will be subject to currency exchange fees, but this is just a function of RBC’s system not recognizing this type of trade.
The last step is the one that I had the most trouble with, as I had to speak to a couple representatives before someone was able to confirm that it will work, even though there were warning flags everywhere. I’m not sure if this method is easier at other brokerages, but at least I can confirm that this works here.
Anyone try this since my post? Did you run into any difficulties or was it smooth sailing?