Canadian Capitalist Logo Dark
No Result
View All Result
Friday, March 24, 2023
  • Login
  • Register
  • Home
  • Economy
  • Investing
  • Markets
  • Real Estate
  • Retirement
  • Tax Savings
  • Trivia
  • Resources
Subscribe
Canadian Capitalist Logo Light
  • Home
  • Economy
  • Investing
  • Markets
  • Real Estate
  • Retirement
  • Tax Savings
  • Trivia
  • Resources
No Result
View All Result
Canadian Capitalist Logo Mobile
No Result
View All Result
Home Uncategorised

How to Make a “Wash” Trade

by Ram Balakrishnan
August 28, 2006
Reading Time: 2 mins read
125 8
0
savings in retirement
152
SHARES
1.9k
VIEWS
Share on FacebookShare on TwitterShare on Linkedin

A reader, Mr. L, sent the following information on how TD Waterhouse clients can avoid paying currency conversion fees when trading US-listed stocks in a self-directed RRSP account. Here is his detailed e-mail, posted with his permission (and slightly edited):

Since my last email to you, I have discovered that one brokerage house does allow you to avoid all of these costly currency conversions. I was just informed today that TD Waterhouse, which I use, will allow me to convert the Canadian cash held in my RRSP to US funds and buy their US Money Market Fund, currently paying 4.26% interest annually (code: TDB166). When I buy a US stock online using TD Webbroker, I merely have to call one day before the trade settles and ask them to sell enough of that money market fund to cover the trade (as mutual funds only take a day to settle, versus 3 days for equities) and no conversions are made back and forth. When I sell the US stock, I again must call them one day before the trade settles to have them buy an amount of the US Money Market Fund equivalent to the trade proceeds. They call this a ‘wash’ trade.

In this way they say that I can avoid paying any further currency conversions beyond the initial one in order to trade US equities. The only hassle is that even though you are trading online, you still have to phone regarding buying and selling the US Money Market Fund. A small price to pay to avoid all of the extra fees and this hopefully will eventually be changed to allow everything to be done online.

As far as I know, RBC Action Direct, which is our primary brokerage account does not offer this feature. US equities comprise a big portion of our portfolios and the ability to do a wash trade makes switching to TD Waterhouse a tempting option. Thank you for the information, Mr. L!

Related posts:

  1. Finding a Financial Advisor, Part 1
  2. Carnival of Debt Reduction # 19
  3. The Income Tax Cut is Better
  4. Replacing the Furnace
Share61Tweet38Share11

Get real time update about this post categories directly on your device, subscribe now.

Unsubscribe
Previous Post

Review: Microsoft Money 2007

Next Post

This and That

Ram Balakrishnan

Ram Balakrishnan

Related Posts

Why you cant afford a house in Canada

Why You Can’t Afford A Home In Canada?

January 24, 2022
365
investing benefits
Investing

Finding a Financial Advisor, Part 1

June 19, 2021
2.1k
investing in bitcoin

Is it time to invest in Bitcoins again?

May 13, 2019
2k
when do reits liquidate
Uncategorised

Performance of Currency-Neutral S&P 500 Index Funds

January 19, 2014
2k
is mortgage interest tax deductible
Uncategorised

The 2013 Sleepy Portfolio Report Card

January 12, 2014
2k
how to buy individual stocks in canada
Uncategorised

Asset Class Returns for 2013

January 5, 2014
1.9k
Next Post
income funds for retirement

This and That

Please login to join discussion
Canadian Capitalist

© 2022 Canadian Capitalist

Navigate Site

  • Home
  • Disclaimer
  • Privacy Policy
  • Advertisement
  • Contact Us

Follow Us

No Result
View All Result
  • Home
  • Economy
  • Investing
  • Markets
  • Real Estate
  • Retirement
  • Tax Savings
  • Trivia
  • Resources

© 2022 Canadian Capitalist

Welcome Back!

Sign In with Facebook
Sign In with Google
Sign In with Linked In
OR

Login to your account below

Forgotten Password? Sign Up

Create New Account!

Sign Up with Facebook
Sign Up with Google
Sign Up with Linked In
OR

Fill the forms below to register

*By registering into our website, you agree to the Terms & Conditions and Privacy Policy.
All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
two man and woman standing on doorway
The man who does not read has no advantage over the man who cannot read - Mark Twain