Hi, I have an account of international IB account outside of USA and the base currency is not US dollars. I would like to buy a USA ETF. IB has approved me to buy USA stock, I assume that means I can buy USA ETF since there is no ETF option. I know I can exchange to US dollars ahead with IB FX first then buy US ETF when I want. I don't know the exact steps so it would be great if someone can share it. I also want to know how to just buy the USA ETF when I want, and do the currency exchange at the same time. I try to find out this option in TWS but don't know where it is. It would be great if someone can show me how to do this step as well.
This is from the IB website: What happens if I trade a product denominated in a currency which I do not hold in my account? The particular currency which is necessary to purchase and settle any given product is determined by the listing exchange not IB. If, for example, you enter into a transaction to purchase a security which is denominated in a currency that you do not hold and assuming that you have sufficient margin excess, IB will create a loan for those funds. Note that this is necessary as IB is obligated to settle that trade with the clearinghouse solely in the designated currency of denomination. If you do not wish to have such a loan created and incur its associated interest costs, you would need to either first deposit funds into your account in the required currency form and amount or convert existing funds in your account using either our IdealPro (for amounts in excess of USD 25,000 or equivalent) or odd lot (for amounts below USD 25,000 or equivalent) venues, both available through the TWS. Also note that once you close out a security position which is denominated in a given currency, the proceeds will remain in that currency regardless of whether it is the Base Currency you've selected for your account. Accordingly, such proceeds will be subject to exchange rate risk relative to your Base Currency until such time you either perform a currency conversion or use those proceeds for another similarly denominated product. http://ibkb.interactivebrokers.com/node/722