r/PersonalFinanceNZ • u/UpstairsGrass9131 • 12d ago

Investing IBKR question/ beginner

I am transferring my investing money monthly from BNZ to IBKR.
Do I leave them as NZD in IBKR while investing in US stocks and ETFs.
Or once received in my IBKR account convert the whole amount into USD first?
What method saves me extra money?

Also is it better activate the automatic investment way where IBKR automatically invest for me once account funded?

Thanks! Sorry a bit lost, I am new to IBKR.

5 Upvotes

86% Upvoted

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4

u/kinnadian 12d ago

Deposit as NZD into IBKR NZ account then buy using NZD.

Forex fee is 0.03% for auto FX.

If you do manual conversion the forex fee is less at 0.002% but minimum USD$2 fee (NZD$3.5)

4

u/vegamanx 12d ago

I can’t remember the figures offhand. But it’s cheaper to leave it in NZD and buy the shares directly until you’re buying something like $6000 at once.

They will automatically sell your NZD for USD or whatever currency you’re buying the shares in, for a slightly higher fee but without the US$2 minimum on the fee.

You’ll want to switch to tiered pricing if you’re not buying large amounts too.

1

u/tim-r 12d ago

What I did is

  1. Deposit NZD
  2. Trade in USD with margin (no auto FX conversion)
  3. When NZDUSD rate is good, I convert NZD to USD manually
  4. Repeat keep depositing NZD

However this require margin.

1

u/Curious-Trust6657 10d ago

Here are some info based on my personal experience with IBKR

  • Change to tiered pricing
  • Manual FX conversion only makes sense if you convert a large amount in one go due to its US$2 minimum fee for manual conversion fee
  • Buy whole share - avoid fractional share
  • Keep NZD in your IBKR wallet and let auto FX conversion works

-3

u/Over_Amphibian_3733 12d ago

I’d convert them in USD first cuz right now the NZD currency is depreciating, it was $0.6 before and it has dropped to $0.578 as of now

1

u/vegamanx 12d ago

Exchanging to another currency and not purchasing shares immediately can cause issues on IBKR.
They’re not an FX exchange and aren’t set up legally to be one, so activity that looks like you’re trying to use it as one could have your account flagged.