Purchasing ETF's - Currency issues

W

Warren

Registered User
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Hi guys,

Im interested in purchasing a number of ETF's and am currently evaluating which broker to use. I've gone through the other relevant threads, including the best buys, and right now Im considering Sharewatch or Keytrade. Sharewatch only seems to allow trading of Irish or UK shares which means I would have to purchase the ETF's in sterling from the LSE. I am just wondering if this is a good idea. Most of the ETF's I will be interested in will be in non eurozone areas so there are already currency issues to consider e.g. S&P 500 SPY. Would buying in sterling increase risk i.e. conversion would be from US to GBP to EU and so any gains/losses could be affected by changes in Euro/Sterling exchange rates.

For that reason should I go with Keytrade and purchase ETF's from Euronext?

cheers,
warren
 
I have used Keytrade myself previously for this very reason. I just find it much easier to deal in euro....
 
Hi guys,

I've decided to just go ahead and open the KeyTrade account. But my original question is still bugging me, at this stage just to satisfy my curiosity on whether its something people should consider. any takers?
 
If you buy the s&p500, in gbp, you will be going from usd to gbp, gbp to eur. so the relevant rate is usd to eur. It is movements in this rate which will affect your investment, not dollar/gbp or gbp/eur.
 
The price should reflect the FX rate anyway and Sharewatch give good rates in my opinion so it's not an issue other than your bank transfers.
 
max said:
If you buy the s&p500, in gbp, you will be going from usd to gbp, gbp to eur. so the relevant rate is usd to eur. It is movements in this rate which will affect your investment, not dollar/gbp or gbp/eur.
Click to expand...

Hi Max/DirtyH2O,

Thanks for the resposes, much appreciated. Initially I didnt believe you Max but I just checked it out on XE.com

It makes perfect sense, I guess I didnt think it through enough. Exchange rates follow this patterns because any difference is immediately eliminated by people buying /selling currencies
 
Do Keytrade not offer variosus denominated accounts i.e. acounts of various curencencies. It looks like it here(not very clear *.gif): [broken link removed]

Or am I mistaken?
 
hattrick_12a said:
Do Keytrade not offer variosus denominated accounts i.e. acounts of various curencencies. It looks like it here(not very clear *.gif): [broken link removed]

Or am I mistaken?
Click to expand...
Anyone know the answer to this question, if keytrade will allow you to hold US shares in USD rather than converting them to euro and loose out on currency exchange rate.
 
A share is a share no matter what currency is involved,you can sell it in one currency,do the FX and be left with the same amount of the other currency as if you had sold it in the other currency(minus charges)
 
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