How To Buy Stocks On Ipo Day Questrade

How to buy stocks on ipo day questrade

I personally spoke with a Questrade agent about my question.

How to buy stocks on ipo day questrade

To make a long story short: in a margin account, you are automatically issued a loan when buying U.S. stock with a Canadian money. Whereas, in a registered account (e.g. RRSP), the amount is converted on your behalf to cover the debit balance.

Me:

What happens if I open an account and I place an order for U.S.

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stocks with Canadian money? Is the amount converted at the time of transfer?

How to buy stocks on ipo day questrade

How does that work?

Agent:

In a margin account, you are automatically issued a loan for a currency you do not have, however, if you have enough buying power, it will go through.

The interest on the overnight balance is calculated daily and is charged on a monthly basis.

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We do not convert funds automatically in a margin account because you can have a debit cash balance.

Agent:

In a registered account, the Canada Revenue Agency does not allow a debit balance and therefore, we must convert your funds on your behalf to cover the debit balance if possible.

We convert automatically overnight for a registered account.

Agent:

For example, if you buy U.S.

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equity you will need USD to buy it, and if you only have CAD, we will loan you USD to cover for that transaction. For example, if you had only $100 CAD and then wanted to buy U.S. stock worth $100 USD, then we will loan you $100 USD to purchase the stock.

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In a margin account we will not convert the funds automatically. Therefore, you will remain to have a $100 CAD credit and a $100 USD debit balance (or a loan) in your account.

Me:

I see, it means the longer I keep the stock, the higher interest will be?

Agent:

Well, yes, however, in a registered account there will be not be any interest since we convert your funds, but in a margin account, there will be interest until the debit balance is covered, or you can manually convert your funds by contacting us.

How to buy stocks on ipo day questrade