UK resident buying US shares

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Hi

This is my first post here so hope its in the right forum.

I want to include some US stocks in my investments. I have an account with ii which allows me to buy international stocks. My question is about the process of buying. There is an option to buy the US stock and do the currency exchange(gbp to USD) in one transaction or alternatively I can convert the GBP to USD an then do the stock purchase. Am I wrong in thinking it would best to convert the money then buy the shares because I would know exactly what rate I am getting for the currency conversion ? Also why is the rate given that I looked at today $0.03 less than the current market rate?

[servodude]

What's reported as "market rate" is the middle of where they think the market is at that point in time.
What rate you'll get will depend on how much you are converting at a given time (you'll get a better rate if you convert more) and how much your broker has decided to keep for themselves.

Ultimately as you're using the same broker to do the exchange as buy the shares it really comes down to whether you think you save more in fees (by transferring a larger amount to USD then you need) than you might lose (in opportunity cost or exchange variation) by having the excess being held in USD. Bearing in mind if you decide it's better off in blighty you'll be be hit with changes going back

-sd

[Alaric]

Am I wrong in thinking it would best to convert the money then buy the shares because I would know exactly what rate I am getting for the currency conversion ?

If you are investing outside of an ISA, ii will open a dollar cash account in your name. If you are anticipating dividends and further dollar investments, perhaps such an account will be useful. As far as exchange rates are concerned, you are stick with whatever ii will offer.

[monabri]

You've submitted your W8-BEN form to ii?

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You've submitted your W8-BEN form to ii?

Hi

Yes I did thanks

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Am I wrong in thinking it would best to convert the money then buy the shares because I would know exactly what rate I am getting for the currency conversion ?

If you are investing outside of an ISA, ii will open a dollar cash account in your name. If you are anticipating dividends and further dollar investments, perhaps such an account will be useful. As far as exchange rates are concerned, you are stick with whatever ii will offer.

I invested within a SIPP