currency exchange

[jersey..authentix]

Anyone know why we are paying more than the actual Canadian conversion rate.  As of right now we are at around 75 cents to the USD, or what the inverse rate of 1.33 CDN to the USD. Should the inverse rate not be $1.25 CDN?

I am about to sent off 1000USD , in CANADIAN funds, which should be around $1250. If we are truly at $.75.

I used a currency converter and found that I have to pay 1333 CDN. Doing the math. this actually puts are dollar at $.67. I dont get it. Is are CDN dollar at $.75 or $.67

1,333.00 CAD	=	1,000.92 USD
Canadian Dollar	↔	US Dollar
1 CAD = 0.750877 USD	1 USD = 1.33178 CAD

[pocomocomputing]

1 / 0.75 = 1.333

You can't use 25% like 1.00 + 0.25 = 1.25 or 1.00 - 0.25 = 0.75.  That is simple addition and math does not work this way.

You must use 1/x for inverse.

[pierrelebel]

Currently, US$1.00 = Cdn$1,333

or looking at it in reverse, Cdn$1.00 = US$0.75

So sending US$ 1,000 to Cdn$ should cost approximately Cdn$1,330.00 + fluctuations + conversion fee (typically 2.5%)

[mr.elmwood]

You are using one formula to do two different conversions.  US to Canada is one formula, Canada to US is a different one.

[femmefan1946]

There is no actual  conversion rate.

The rate published in newspapers is the rate banks use between themselves on multi-million dollat/euro/yen/rembi/ rupee/ pound exchanges.

It is useful and many 'retail' customers use it -- for example, that was the rate I was instructed to use when calculating exchange on government expense accounts.

If you go to your local bank, you will get a different rate. And if you go the next day, another different rate. And if you go across the street to the credit union, you will get another rate. The bank next door will have yet another rate, and so will the foreign exchange store along the block.

The multi-national rate changes minute by minute, although most institutions only change their rates once  a day. (Unless you are in a country like Zimbabwe where event the 'retail' bank rate can change hourly.

Also -- all those institutions have different buy and sell rates and charge a commission on the service.

[decal-fx]

To Further illustrate Femmefan's Point TD Canada Trust updates their currency exchanges rates hourly, at least that's what I was told by  manager.  Of the actual B&M backs I've found TD to have the best rate for buying US$, ymmv

[jersey..authentix]

Realistically then our dollar really is only worth $.67 ??

If the conversion rate is $1.33 then our dollar isn't at $.75. Strange way of calculating.

[pierrelebel]

"Realistically then our dollar really is only worth $.67 ??"

No.

A Canadian dollar is currently worth US$0.75

Disregarding conversion fees for a moment, let us assume you go to the bank with Cdn$ 100 and ask the teller for US$.

The teller will give you US$75 because one Canadian dollar is worth US$0.75

Now, you turn around with your US$75 and ask for Cdn$

The US$75 will be multiplied by 1.333 to arrive to the original Cdn$ 100

[ricarmic]

Hi Jersey:

If it helps....

If the Canadian dollar is worth 75c USA $ the conversions are accomplished by multiplications:

$100 $C x .75 = $75 USA$
(AxB=C)

which is the same as:
$100 $C = $75 US$/0.75
(A=C/B)

If one wants to know how much $100 US$ becomes:

?$C = $100 US$/.75
(A=B/C)

?C$ = $133.33