How To Exchange CAD To USD In CIBC Investor’s Edge?

If you live in Canada and want to invest in US stocks you have two options to choose from. The first option is plain simple, open the Investor’s Edge CAD account and buy the “Apple or Facebook” stock.

What really happens here is that your CAD gets converted to USD, using CIBC’s exchange rate at the moment and your buy trade gets triggered. When you want to sell the stocks, the same repeats, you sell the underlying stocks, and the amount gets converted back from USD to CAD. 

So everything till now sounds pretty simple and straightforward, right? It is actually. Then why do you have to open the TFSA or RRSP USD accounts, or why do you have them in place? Another question you might probably be thinking is that, why should you go through the hassles of exchanging from CAD to USD in the first place. Let’s find that out. 

Note: You can purchase and hold the US stocks in your TFSA or RRSP Canadian account as well. In this case, your Canadian Dollars will be exchanged to USD automatically upon the stock purchase and similarly when you sell the stock.

Instead of holding US stocks under the Canadian Account, keeping it under the TFSA or RRSP USD makes more sense, you get to control when to exchange the money back and at what time. That’s the whole point of discussion here. Let’s get started. 

Why Should You Convert CAD to USD Using the Investor’s Edge Platform?

1. Integrated Management:

Benefit: The Investor’s Edge platform allows you to seamlessly manage both Canadian and US investments in one place.

Why It Matters: This integration simplifies portfolio management, providing a holistic view of your holdings and facilitating efficient decision-making.

2. Real-Time Rates:

Benefit: Access to real-time currency conversion rates on the platform.

Why It Matters: Up-to-the-minute rates empower you to make informed decisions, ensuring transparency and accuracy in currency conversions.

3. Cost-Effective Conversions:

Benefit: Potentially competitive currency conversion rates.

Why It Matters: Lower conversion costs can contribute to overall investment profitability, making Investor’s Edge a cost-effective choice for currency exchanges.

4. Streamlined Trading:

Benefit: Execute currency conversions within the same platform where you trade US stocks.

Why It Matters: Streamlining the trading process enhances efficiency, eliminating the need for external services and creating a cohesive user experience.

5. Efficient Portfolio Tracking:

Benefit: Consolidated portfolio tracking for both Canadian and US holdings.

Why It Matters: Efficiency in monitoring your entire portfolio simplifies tracking performance and assessing the overall health of your investments.

6. Research and Analysis Tools:

Benefit: Access to robust research tools and market analysis for Canadian and US securities.

Why It Matters: Informed decision-making is facilitated through comprehensive research, supporting investors in navigating the complexities of both markets.

7. Risk Management Opportunities:

Benefit: Tools for implementing currency hedging strategies.

Why It Matters: For those seeking to manage currency risk, having access to hedging options within the platform enhances risk management capabilities.

8. Customer Support:

Benefit: Availability of customer support for currency-related queries.

Why It Matters: Responsive customer support ensures that investors can seek assistance when needed, fostering confidence and trust in the platform.

9. Tax Reporting Integration:

Benefit: Consolidated statements and reports for tax reporting purposes.

Why It Matters: Simplified tax reporting streamlines the administrative aspects of managing a diverse portfolio.

Investing with CIBC Investor’s Edge offers not just a trading platform but a comprehensive ecosystem that caters to the needs of investors engaging in both Canadian and US markets. The benefits outlined above collectively contribute to a user-friendly, efficient, and cost-conscious investment experience.

How To Convert CAD to USD Using the Investor’s Edge Platform? 

If you Invest using CIBC’s Investor’s Edge platform and want to buy US stocks, here’s how you can convert Canadian Dollars to US dollars in a simple way. 

Remember, your CIBC Investor’s Edge account has four components: 

1.  RRSP Canadian

2.  RRSP US

3.  TFSA Canadian 

4.  TFSA US

The Pros of holding US stocks in RRSP are: 

A dividend cut of 15% will not be applicable to you. For example, apple stock pays out a dividend of 0.82 USD per quarter at the moment. 

The Cons of holding US stocks in RRSP are: 

You cannot take out the money if required without paying the taxes applicable per the Canadian Government and your tax slab, except buying a first house or student loan

Pros of holding US Stocks in TFSA: 

1. You can invest in US stocks anytime you want to and how much you want to (within the TFSA limits of course) 

2. You can take out the money to your chequing account when needed (counts against the annual quota)

3. If you invest in US stocks using the TFSA CAD account type, your Canadian dollars are going to be converted to USD, but still, you will see the stock value increase/decrease in Canadian dollars, per exchange rate at that minute. 

4. If you invest in the TFSA USD account, you will have to first convert CAD to USD and then buy the individual stocks or ETFs trading in the US exchanges. 

Let’s look at option 4 here.

Investor’s Edge TFSA CAD To USD Money Exchange

Steps to be followed to convert TFSA CAD to USD account: 

1. Login to your CIBC Investors Edge Account here – https://www.investorsedge.cibc.com/en/home.html

1. Click “Cash Transfers” from the left menu 

2. Click on Foreign Exchange>Submit A Request link 

3. Make sure you have sufficient funds in the TFSA Canadian account (TFSA CAD) 

4. Select the TFSA CAD account and enter the amount you want to convert to USD

5. The system should automatically populate the equivalent US dollars and “choose the TFSA USD account” for exchange

6. Click on submit the request. (Double-check the exchange rate you’re getting)

7. The Canadian amount should be converted and you should see the USD amount in your TFSA USD account within 5 minutes max.

Remember: You cannot exchange the money at any time you want to, you will have to always do it during the regular market trading hours. 

Following the above steps is extremely convenient and easy. This way, you don’t have to call CIBC Investor’s Edge every time you need to convert money and wait on hold to speak to someone. 

You can also follow similar steps to convert money from RRSP CAD to RRSP USD in your Investor’s Edge Account. 

CIBC Investors Edge US Stocks Investing Using CAD

Investing in US stocks using CAD (Canadian Dollars) through CIBC Investor’s Edge provides Canadians with access to the vast and dynamic US stock market. Here’s a practical guide on how you can navigate this process:

1. Account Setup:

Start by opening a brokerage account with CIBC Investor’s Edge. Ensure that your account is set up to handle both Canadian and US currencies.

2. Funding Your Account:

Deposit funds into your CIBC Investor’s Edge account in Canadian Dollars. You’ll have the flexibility to convert your CAD to USD when you decide to make a US stock investment.

3. Currency Conversion:

When you’re ready to invest in US stocks, you can convert your CAD to USD within your Investor’s Edge account. Be aware that there might be a currency conversion fee associated with this process.

4. Research and Stock Selection:

Utilize the research tools provided by CIBC Investor’s Edge to analyze US stocks. The platform typically offers various resources, including market analysis, stock charts, and financial news.

5. Placing a Trade:

Once you’ve selected the US stocks you want to invest in, use the trading interface on Investor’s Edge to place your order. Specify the quantity of shares and any other relevant details.

6. Monitoring Your Investments:

Keep track of your US stock investments through the Investor’s Edge platform. Monitor market trends, news, and any changes in your portfolio value.

7. Managing Currency Fluctuations:

Be mindful of currency fluctuations as they can impact the value of your US stock holdings when converted back to CAD. Some investors may choose to implement currency hedging strategies to manage this risk.

8. Tax Implications:

Understand the tax implications of investing in US stocks as a Canadian resident. Consider consulting with a tax professional to ensure compliance with both Canadian and US tax regulations.

9. Customer Support:

If you encounter any issues or have questions about investing in US stocks through CIBC Investor’s Edge, reach out to their customer support. They can provide assistance with account-related queries or technical support.

10. Stay Informed: – Stay informed about changes in the market, economic conditions, and any developments related to your US stock investments. This knowledge will help you make informed decisions over time.

Final Words

CIBC Investor’s Edge is one of the best investment platforms in Canada used by millions of Canadians every single day. Moreover, Investor’s Edge has a flat fee of $6.95 per trade (whether it’s a buy or sell order) is the highlight of the platform. You can invest in ETFs, Canadian & US Stocks, and Mutual Funds using the platform. 

If you’re planning to open a new investor’s account, always remember to open both US and a Canadian Dollar account both for the TFSA and RRSPs. By doing so, you can easily convert Canadian dollars to US Dollars and save the constant spread and exchange fees when buying US stocks through Canadian dollars. Likewise, you can reverse the process as well from USD->CAD.

To place a trade on the Investor’s Edge platform, you can trade using the online web portal, mobile smartphone app, or by using a tablet. The platform is quite robust and neat to use. Please let me know your thoughts and comments below. Thanks for reading!