In Norbert's Gambit, you need to buy, journal and sell DLR ETF. It takes around 5 business days for the Norbert's Gambit process to be completed.
Norbert’s Gambit is a cheaper technique to convert Canadian Dollars to US Dollars and vice versa. Generally, when you convert money via a bank or an exchange kiosk, it is done within a few minutes from producing your money to the service provider. However, these methods are costlier than the Norbert’s Gambit method. Most people who exchange large volumes of money take this alternate way to convert money. However, it is important to find out how long it takes to exchange your CAD to USD or the other way around.
Day 1: You purchase DLR shares in TSE, during trading hours.
Day 2: No activity
Day 3: It generally takes 2 days for the buy transactions to settle and the shares are now available in your account. You contact your trading platform and journal the shares US exchange immediately and sell your shares. Please note that you can journal the shares via an email, phone call or chat.
Day 4: No activity
Day 5: Sales settlement will be completed by this time and US dollars will be available in your account. You can withdraw these funds or transfer them to your bank account, depending on your comfort.
Thus, it takes around 5 days for Norbert’s Gambit to be processed. These 5 days must be business days. For example, if you purchase your shares in TSE on a Friday, then this entire process will be completed on next week Friday and in this case, it takes a week’s time in reality. During this time, the share price of both DLR on the Canadian and US stock exchanges fluctuate. The currency conversion rate also moves up or down within this time.
If you are ready to wait for the process to get over, and if you have voluminous cash to weather any fluctuations in currency conversion rates and market volatility, you can opt for Norbert’s Gambit technique. In addition, if you do not have an online brokerage platform in the first place, then you need to add the account opening timeframe to this process.