Is Norbert's Gambit worth it?

Last Updated: 05-Dec-2022

Short Answer

Using Norbert's Gambit is worthwhile given some conditions - when you do not have to convert your currency immediately and/ or when you need to convert a large sum of money.

Detailed Answer

What is Norbert’s Gambit?

The Canadians are highly interlinked with American markets. Canadian residents travel to the United States for business, leisure travel etc. For this purpose, residents require US dollars during their stay in the US. One could convert the currency into a bank or an exchange kiosk at the border.

An alternative cheap way is Norbert’s Gambit, which converts Canadian dollars to US dollars and the other way around. This is done through a discount brokerage account.

Is Norbert's Gambit worth it?

Norbert’s gambit process takes around 5 business days to get completed. It is worth it when you can wait for 5 working days, to get your money converted.

Let’s imagine you have a trading and bank account with RBC Bank, which is one of the big 5 banks in Canada. If you are converting $10,000 CAD, then you will receive $7,116.93 USD in your bank account as of 11th October 2022.If you are converting using Norbert’s Gambit, then you will receive $7,260.55 USD. You need to pay $10 twice – once when you buy and once when you sell the shares. So, you will have $7,240.55 USD. You can save $123.62 USD using Norbert’s gambit. The savings will keep increasing as your volume of funds increases, as the $10 CAD transfer fee is a fixed cost. Hence, Norbert’s Gambit is worth it when you need to convert a large volume of money.

When is Norbert’s Gambit not worthwhile?

If you require your money urgently, then it is better to use a bank or exchange kiosk.

If you do not even have an online brokerage account, then it is better to use the traditional ways of conversion.

Imagine, if you need to convert $100 CAD with RBC. You will receive $71.03 USD. When you go for Norbert’s Gambit, you will receive $72.55 CAD. However, a $20 CAD transfer fee is applicable, and you will have only $52.55 USD in your account.

Worthiness of Norbert’s gambit

In addition to the above, you should also consider market risk, currency conversion risk. In addition, you should beware of articles that lure you to earn money through currency conversion. You must explore if it is a scam or not before plunging into it.

Tagged With: norbert's gambit worthinessworth of norbert's gambitnorbert's gambitconvert cad usdcurrency conversion
Categories: Finance
Ask Your Query for FREE, Get quick answers from our FINTRAKK community!
Discussion (0)
Related FAQs
How much does Norbert's Gambit save?

You will save a considerable amount on conversion fees, by following the Norbert's Gambit. Our calculations suggest that you can save around $2,100 CAD for converting $100,000 CAD into USD.

How does Norbert's Gambit work?

Norbert's Gambit process has various steps starting from buying DLR.TO, journaling the shares, selling DLR. UTO, and finally selling the shares in the US stock exchange.

Is Norbert's Gambit legal?

Yes, Norbert's Gambit method of currency conversion is legal in Canada. It is not restricted by any registered authorized of Canada.

How long does Norbert's Gambit take?

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.

What is Norbert's Gambit and why it is called so?

Norbert's Gambit is a cheap method to convert CAD to USD and vice versa using an online discount brokerage account. It is named after its founder Mr. Norbert Schlenker.

Can Canadians buy property in USA?

Yes, Canadians can purchase a property in the United States of America, just like any US citizen does. In fact, it is reported that the top foreign purchasers of US property are Canadians.

How does TFSA work in Canada?

The contribution conditions within TFSA differs from circumstance to circumstance. Let's figure out in details how TFSA works for Canadian investors.

What are Canadian Currency Coins names and values?

The name of Canadian currency coins are as follows:

  • Loonie (One dollar)
  • Toonie (Two dollars)
  • Quarter (25 cents)
  • Dime (10 cents)
  • Nickel (5 cents)
  • Penny (One cent)- Phased out
Is Thinkorswim free in Canada?

No, Thinkorswim is not completely free in Canada. Thinkorswim is powered by TD Ameritrade, a commission free US brokerage firm. The stock broker charges $0 commissions on online US stocks and ETFs. You have to bear some cost on option trades.

How to start investing with 100 dollars in Canada?

There are many ways in which you can invest $100 such as robo advisor platform, fractional shares, ETFs, managed funds, crypto currency, etc. Let's discover and discuss different ways of investing an amount of 100 CAD in Canada.