⚠️ Senior Editor's Note (January 2026 Update): "Norbert's Gambit" involves buying and selling the Global X (formerly Horizons) US Dollar Currency ETF (DLR/DLR.U). While fully legal, it carries market execution risk as currency rates fluctuate during the T+1 settlement period. Trading commissions vary by brokerage (Questrade, TD, RBC, etc.).
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| Stop Paying 2.5% FX Fees! |
You want to buy $10,000 worth of Tesla or Apple stock in your RRSP. You deposit $10,000 CAD and hit "Buy."
Congratulations, you just lost $250 instantly.
Most Canadian brokerages and banks charge a hidden Foreign Exchange (FX) Fee of roughly 2.5% when you buy US assets with Canadian dollars. They don't explicitly call it a fee; they simply bake it into a terrible exchange rate.
But seasoned investors don't pay this. They use a legal strategy known as "Norbert's Gambit." In this guide, we will show you how to swap $10,000 (or even $100,000) for a flat fee of roughly $10, completely bypassing the bank's unfavorable rates.
Why You Are Losing Money
Let's compare the cost of converting $10,000 CAD to USD using the standard bank rate versus Norbert's Gambit.
| Method | Exchange Fee % | Total Cost on $10k |
|---|---|---|
| Standard Bank Exchange | ~2.5% | $250 |
| Norbert's Gambit | ~0.15% | ~$10 - $20 (Commissions) |
| Your Savings | $230+ Saved |
On a $100,000 portfolio, this strategy saves you $2,500. That is enough to fund a vacation, simply by clicking a few buttons.
The DLR.TO Strategy
The strategy utilizes a specific ETF called DLR (Global X US Dollar Currency ETF). This ETF exists in two versions that represent the exact same pile of cash:
- DLR.TO: Priced in Canadian Dollars (CAD).
- DLR.U.TO: Priced in US Dollars (USD).
Because they are the exact same asset, you can buy the CAD version and sell the USD version to convert your cash at the true "spot rate," avoiding the bank's markup.
Questrade / TD / RBC
Here is the exact workflow to execute this in 2026. (Note: You need a Margin, RRSP, or TFSA account. This does not work easily on Wealthsimple without a USD subscription).
-
Step 1: Buy DLR.TO
Use your Canadian dollars to buy shares of DLR.TO. Calculate the number of shares needed based on the current CAD price (approx $13-$14 CAD). -
Step 2: Journal the Shares
This is the crucial step. Contact your broker (Questrade has a "Chat" function; Big Banks often require a phone call) and ask them to "Journal my DLR.TO shares over to DLR.U.TO."
(Note: Some sophisticated platforms like RBC Direct Investing may do this automatically if you sell on the US side, but calling is safer for beginners.) -
Step 3: Wait for Settlement (T+1)
Thanks to the T+1 settlement rules fully implemented in Canada/US, this process is faster than in previous years. It typically takes just 1 business day for the trade to settle and the journaling to complete. -
Step 4: Sell DLR.U.TO
Once you see "DLR.U.TO" in your holdings, sell it. Since this ticker trades in USD, the proceeds will settle as US Dollars in your account.
⚠️ Important Warning
Do not use this for small amounts (under $1,000). The trading commissions (e.g., $9.99 to buy + $9.99 to sell at some banks) might cost more than the FX fee savings. This strategy is strictly recommended for amounts over $2,000 USD.
Chief Editor’s Verdict
If you are serious about building wealth in US equities, you cannot afford to ignore Norbert's Gambit. Paying a 2.5% "laziness tax" every time you move money is a wealth killer.
Your Action Plan:
1. Verify if your brokerage supports "Journaling Shares" (Questrade, TD, RBC, BMO, and CIBC all do).
2. Calculate your potential savings. If converting $3,000+, execute the Gambit.
3. Use the saved fees to compound your investments, rather than padding the bank's quarterly profits.
It takes 5 minutes of work to save hundreds of dollars. That is likely the best hourly wage you will earn this year.
LEGAL DISCLAIMER: This article is for educational purposes only and does not constitute financial or investment advice. "Norbert's Gambit" involves purchasing securities (ETFs) which carries market risk. Prices may fluctuate between the time of purchase and sale. Investors should verify trading commissions and settlement times with their specific brokerage before executing this strategy.
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