Originally Posted by
Gaucho100K
If you are taking a 3% hit for trading Euros to Dollars in Euroland then you should perhaps be looking at who you are banking with. Retail exchange rates are one thing, but that kind of spread seems excessive... its like you are almost getting raped. Who do you bank with...? Have you compared this with a local money changer...? Do you have a brokerage or securities account...? Many times ForEx spreads are smaller if you trade from a Investment account rather than from regular commercial banking accounts. I suggest you check with your account manager at your FI and see what options you have.
I can certainly do much better if we are talking electronic transfers or other dematerialised operations but I would struggle doing massively less for purchasing physical banknotes. My (French) bank is Société Générale and they are, as far as I can see, pretty much in line with others. French Online moneychangers are slightly better at about 2.5% but that would not be practical for me for various reasons. There may be alternatives that I am unaware of but my general experience with retail financial services in France is that opportunities to significantly do better (at retail level) than what the banks do on forex are limited.
Spreads here in London tend to be tighter. On GBP/USD or GBP/EUR, I could get banknotes with a 1.5% spread from median inter-bank rates but since I would have to change twice (EUR>GBP>USD), that would defeat the purpose.
Happy to hear any practical suggestion for obtaining physical USD banknotes starting from Euros held in a French account at a rate significantly lower than 3% (bearing in mind that I live most of the time in London and do not plan to spend any time in the US other than changing planes before my next trip to Argentina).
In Buenos Aires, the Euro to Peso is traded through the US Dollar, you get a double hit on the bid/ask spread. Also, since the Euro to US ForEx market in EZE is very small, the spreads are abnormally high. Its hard to calculate with a proper degree of certainty what spreads you will face since this will depend on where you trade (here in EZE).... its not the same if you transact at a market-maker in La City or if you are dealing with a sub dealer, etc.
Hope the above helps.... and hope you have a great trip!!
^
OK, so from what you and
britenbsas say, it would in all likelihood be better to convert to USD in advance.
Thanks to both of you. This is very helpful indeed. And even if I end up paying 1 or 2% too much, it should still end up pretty good value.