Many thanks to Charles for the note Credential Direct (read review here) is now washing rates when U.S. Dollar denominated securities are bought and sold in RRSP accounts on the same day. Charles quotes from their April 2008 newsletter:
FX FLAT TRADES (Washing Rates)
Pay less for US trades. Now when you execute a US$ buy/sell transaction in your registered account (RSP, RIF, LIF etc), and execute another US$ buy/sell transaction that same day, we’ll apply the same foreign exchange rate to both transactions – providing you call us [Credential Direct can be contacted at 1-877-742-2900] before executing the subsequent US$ transaction transaction [sic].
And soon you’ll even be able to deposit US$ into your account, hold it in cash, and use it to buy US stocks!
However, the wash trades offered by Credential Direct depends on the size of the trade. The investment representative I spoke with, confirmed the wash trade capability but said that it is offered only for trades of $10,000 or more. It is surprising that Credential Direct’s wash trading is limited when its competitors like TD Waterhouse, Qtrade and E*Trade do not have restrictions based on the size of the trade.
It’s good news that Credential Direct might follow Questrade in allowing clients to hold U.S. dollars in their accounts directly. The competitive pressures might just force other brokers to follow suit.