TDDI U.S. Exchange Rate for U.S. dividends

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TDDI U.S. Exchange Rate for U.S. dividends

Post by 2 yen » 03 Jan 2016 07:23

Anyone know where on the TDDI website one can find the actual exchange rate used for U.S. dividends being converted to CAN?
I own BEP.UN. The dividends are paid in U.S. dollars and converted to CAN in my account. The dividend was paid into the account on December 31st. TDDI's posted exchange rate on the homepage was 1.384. The conversion rate used in the account was 1.369. Where can this latter rate be found on the website?

Thanks!

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Re: TDDI U.S. Exchange Rate for U.S. dividends

Post by pmj » 03 Jan 2016 09:18

Not a direct reply to your Q - but at TDDI, I've journalled all our US$-pay stocks to the US$ accounts.
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Re: TDDI U.S. Exchange Rate for U.S. dividends

Post by AltaRed » 03 Jan 2016 10:58

There has been considerable discussion over on CMF about conversion of USD dividends to CAD and a frustration that regulatory authorities are not insisting on a standard methodology at a spot rate.

It appears that sometimes it is the issuing company that makes conversions, not the brokerage. In some cases, it apparently does not matter if one journals USD paying stocks over to the USD side because the company automatically converts USD dividends to CAD for Cdn shareholders. IOW, don't assume it is TDDI that is making the conversion all the time. Also, sometimes the conversion is done on record date or issue date.

Ask TDDI itself how and where the conversion is made, and by whom and how. Journalling the stock over to the USD side of the account should work better, but not necessarily so.
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Re: TDDI U.S. Exchange Rate for U.S. dividends

Post by ig17 » 03 Jan 2016 11:02

2 yen wrote:Anyone know where on the TDDI website one can find the actual exchange rate used for U.S. dividends being converted to CAN?
I own BEP.UN. The dividends are paid in U.S. dollars and converted to CAN in my account. The dividend was paid into the account on December 31st. TDDI's posted exchange rate on the homepage was 1.384. The conversion rate used in the account was 1.369. Where can this latter rate be found on the website?
The posted rate is the rate they use to convert account balances. It doesn't include the exchange fee. The rate used for dividend conversion includes the fee. I don't think they post it anywhere.

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Re: TDDI U.S. Exchange Rate for U.S. dividends

Post by 2 yen » 03 Jan 2016 13:11

ig17 wrote:
2 yen wrote:Anyone know where on the TDDI website one can find the actual exchange rate used for U.S. dividends being converted to CAN?
I own BEP.UN. The dividends are paid in U.S. dollars and converted to CAN in my account. The dividend was paid into the account on December 31st. TDDI's posted exchange rate on the homepage was 1.384. The conversion rate used in the account was 1.369. Where can this latter rate be found on the website?
The posted rate is the rate they use to convert account balances. It doesn't include the exchange fee. The rate used for dividend conversion includes the fee. I don't think they post it anywhere.
Will ask tomorrow. The whole thing should be transparent. I'll report back here.

Thanks all.

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Re: TDDI U.S. Exchange Rate for U.S. dividends

Post by Arby » 03 Jan 2016 14:51

2 yen wrote:Anyone know where on the TDDI website one can find the actual exchange rate used for U.S. dividends being converted to CAN?
I own BEP.UN. The dividends are paid in U.S. dollars and converted to CAN in my account. The dividend was paid into the account on December 31st. TDDI's posted exchange rate on the homepage was 1.384. The conversion rate used in the account was 1.369. Where can this latter rate be found on the website?
On your TDDI Canadian account, if you look under Account Details > Activity, the dividend transaction should indicate the conversion rate (e.g.CONVERT TO CAD @ 1.36900).

I hold BEP.un on the US side of my TDDI account, and can confirm that the dividend is paid in US dollars in my US account.

With regard to whether dividends are converted to $C if the stock is held in a US account, the answer depends on whether the broker is registered with a US depository. The dividends pass through so many different intermediaries that nobody seemed to understand the process. (The dividends go from the Company > Transfer Agent > Depository > Broker). I finally got a good answer about the process from Investor Relations at Encana, as per this post.

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Re: TDDI U.S. Exchange Rate for U.S. dividends

Post by 2 yen » 03 Jan 2016 18:30

Arby wrote:
2 yen wrote:Anyone know where on the TDDI website one can find the actual exchange rate used for U.S. dividends being converted to CAN?
I own BEP.UN. The dividends are paid in U.S. dollars and converted to CAN in my account. The dividend was paid into the account on December 31st. TDDI's posted exchange rate on the homepage was 1.384. The conversion rate used in the account was 1.369. Where can this latter rate be found on the website?
On your TDDI Canadian account, if you look under Account Details > Activity, the dividend transaction should indicate the conversion rate (e.g.CONVERT TO CAD @ 1.36900).

I hold BEP.un on the US side of my TDDI account, and can confirm that the dividend is paid in US dollars in my US account.

With regard to whether dividends are converted to $C if the stock is held in a US account, the answer depends on whether the broker is registered with a US depository. The dividends pass through so many different intermediaries that nobody seemed to understand the process. (The dividends go from the Company > Transfer Agent > Depository > Broker). I finally got a good answer about the process from Investor Relations at Encana, as per this post.
You're correct. That's where I got the info. What I want to know is how is that rate determined and where can I learn about it before the conversion takes place.

Thanks.

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Re: TDDI U.S. Exchange Rate for U.S. dividends

Post by 2 yen » 04 Jan 2016 07:25

Called TDDI this a.m. and they said the exchange rate for U.S. on the homepage is a "kind of" average for the day. The conversion rate for U.S. dividends shown in a CAN account has already had 1.5% taken off for TDDI's fee. The 1.5% "fee" decreases for every $10,000 that is being converted. I only have one stock that pays U.S. dividends so that decrease will never kick in. The conversion is done at the moment the dividend enters the account. Info on these rates is not available on the website.

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Re: TDDI U.S. Exchange Rate for U.S. dividends

Post by BRIAN5000 » 05 Jan 2016 17:08

2 yen wrote:Called TDDI this a.m. and they said the exchange rate for U.S. on the homepage is a "kind of" average for the day. The conversion rate for U.S. dividends shown in a CAN account has already had 1.5% taken off for TDDI's fee. The 1.5% "fee" decreases for every $10,000 that is being converted. I only have one stock that pays U.S. dividends so that decrease will never kick in. The conversion is done at the moment the dividend enters the account. Info on these rates is not available on the website.

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Can anyone verify this commission rate with one of their latest dividend conversions to see if this Rep was correct?


I would like a constant flow of spendable (non-registered) US dollars into my US trading account. As cheap as possible of course, good conversion rate, automatic. To be automatic would leave out "Norbert's Gambit". So if I did one NG for $10,000 cost me $20, if I had 5 different cycle Canadian dividend stocks sitting in my US account paying $2000 each a year the conversion cost would be $150? (20 US $ buys)
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Re: TDDI U.S. Exchange Rate for U.S. dividends

Post by BRIAN5000 » 12 Jan 2016 17:22

Can anyone verify this commission rate with one of their latest dividend conversions to see if this Rep was correct?
Had to call TDDI to get $2.00 charge reversed for statement fees so asked about the cost of Can-US dividend conversion. He said they use the beginning of day rate so for today would be 1.41 x 1.015 which works out to 1.5% if my math is right.

Also of note, from his terminal he can pull up information about calls placed for up to one year. So when I told him On Dec 11 I called at 11:42 and talked to Aaron about statement fees he was able to verify that.
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Re: TDDI U.S. Exchange Rate for U.S. dividends

Post by SQRT » 12 Jan 2016 18:22

Have some USD div payers in my USD TDDI TFSA. I can confirm that the divs stay in USD. Now the process of getting the cash transferred to where you can spend it is unnecessarily complicated, but at least it isn't a forced conversion.

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Re: TDDI U.S. Exchange Rate for U.S. dividends

Post by deaddog » 21 Nov 2016 15:50

Is there any withholding tax on dividends paid in $US if stock is bought on Canadian market?
Any one holding WIR.u or BEP.un?
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Re: TDDI U.S. Exchange Rate for U.S. dividends

Post by Arby » 21 Nov 2016 17:03

deaddog wrote:Is there any withholding tax on dividends paid in $US if stock is bought on Canadian market?
Any one holding WIR.u or BEP.un?
I bought BEP.un on the Canadian market in my TDDI account, and then journaled the shares to US side of my account so that the dividends remain in $US. There is no withholding tax on BEP.un at TDDI.

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Re: TDDI U.S. Exchange Rate for U.S. dividends

Post by deaddog » 21 Nov 2016 18:41

Arby wrote:
I bought BEP.un on the Canadian market in my TDDI account, and then journaled the shares to US side of my account so that the dividends remain in $US. There is no withholding tax on BEP.un at TDDI.
Thanks
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Re: TDDI U.S. Exchange Rate for U.S. dividends

Post by pmj » 21 Nov 2016 20:39

Arby wrote:
deaddog wrote:Is there any withholding tax on dividends paid in $US if stock is bought on Canadian market?
Any one holding WIR.u or BEP.un?
I bought BEP.un on the Canadian market in my TDDI account, and then journaled the shares to US side of my account so that the dividends remain in $US. There is no withholding tax on BEP.un at TDDI.
Also at TDDI, in August I too journalled BEP.UN from CDN TFSA to US TFSA. The September "dividend" had three components - INT(erest), DIV(idend) and TXPDDV (??). The 3rd element was "paid" with a -ve sign, which the first rep I spoke to suggested was tax+fees (about 44%, effectively leaving me with only 12% net of the total dividend!). After I emphatically suggested that an effective 88% deduction was not reasonable, he sent it upstairs, and a couple days later it was fixed. Now waiting for January ...
Added - after it was fixed, I did receive the full dividend, with no deductions.
Last edited by pmj on 21 Nov 2016 21:27, edited 1 time in total.
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Re: TDDI U.S. Exchange Rate for U.S. dividends

Post by Arby » 21 Nov 2016 21:16

My shares of BEP are held in my $US margin account at TDDI. The BEP distribution has 3 components on the monthly statement (Interest, Distribution, and Dividend), which total exactly to the declared quarterly distribution of $US 0.445 per share.

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Re: TDDI U.S. Exchange Rate for U.S. dividends

Post by pmj » 08 Jan 2017 20:44

Update - I had also enrolled for a DRIP on BEP (TDDI US$ TFSA), which didn't happen with the September distribution (maybe I was too late) but it did for December. This time the distribution had 4 components, which added up to the correct US$0.445/share. The reinvestment price was US$29.27, which by eyeball/approx calc does correspond to the stated 5-day weighted av in the DRIP document. So it's functioning exactly as stated by BEP.
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