How Canadians Can Invest in US Stocks When the Loonie Is Weak Without Converting All Their Cash at Once

Canadians looking to buy US stocks while the loonie trades near 71 US cents are not limited to converting all their savings at once. By spreading purchases over time, using Canadian-listed funds and managing their exposure to currency moves, they can still invest south of the border without betting everything on a single exchange rate.

The Bank of Canada recorded an exchange rate of C$1.3960 per US dollar on 30 October 2026, putting the loonie at approximately 71.63 US cents (around €0.6392 and £0.53). At that rate, Canadian savings bought fewer American dollars than they would if the currencies were closer to parity.

As The Motley Fool Canada highlighted on 30 October, investors may be tempted to delay buying US shares until the Canadian dollar strengthens.

However, US stocks could rise before that happens, potentially leaving buyers paying higher prices.

Exchange rates also affect returns after the initial purchase. A stronger loonie can reduce the Canadian-dollar value of American holdings, even when US share prices climb. A weaker loonie can have the opposite effect.

Why Spreading Purchases Can Take the Pressure off Timing

Instead of exchanging a large amount of savings on one day, investors can divide planned purchases across several dates. This allows them to build exposure to US businesses while retaining cash for later investments.

The approach is known as dollar-cost averaging. By investing a fixed amount at regular intervals, investors may purchase more shares when prices fall and fewer when prices rise.

According to the Canadian Investment Regulatory Organization, this strategy can help investors avoid making decisions based solely on short-term market movements. However, it does not guarantee better returns or prevent investment losses.

Spreading purchases also means no single exchange rate determines the cost of every investment. Nevertheless, subsequent purchases could become more expensive if the loonie weakens further or American shares appreciate.

For Canadians buying US-listed shares directly, brokerage fees create another consideration. Currency-conversion charges and available account features vary between providers, while repeated exchanges can reduce the amount ultimately invested.

One alternative is a US-dollar brokerage account. Depending on the provider, investors can retain proceeds from selling American shares in US dollars and use those funds for subsequent purchases without converting them back into Canadian currency.

This can reduce unnecessary conversions, although it does not eliminate currency exposure or other trading costs.

The challenge is that investors cannot reliably predict exchange-rate movements. A regular investment schedule reduces dependence on choosing one particular currency rate, but it may underperform an immediate investment if markets rise.

Canadian-Listed Funds Offer Us Exposure in Local Currency

Canadians can also gain exposure to American companies through exchange-traded funds, or ETFs, listed in Canada. These funds allow investors to purchase US market exposure in Canadian dollars without personally arranging a currency conversion.

One example is BlackRock's iShares Core S&P 500 Index ETF, traded on the Toronto Stock Exchange under XUS. It provides exposure to approximately 500 large US companies, offering greater diversification than investing in a single stock.

However, purchasing an ETF in Canadian dollars does not automatically eliminate foreign-exchange risk.

XUS is unhedged, meaning movements between the Canadian and US dollars can influence its Canadian-dollar returns. If the loonie strengthens, the value of its American holdings may decline when translated into Canadian currency.

BlackRock also offers the iShares Core S&P 500 Index ETF (CAD-Hedged), listed under XSP.

Unlike XUS, XSP uses currency hedging to reduce the impact of exchange-rate movements. However, hedging cannot eliminate currency risk entirely, and its returns may differ from those of the unhedged fund.

That distinction becomes particularly important when the loonie strengthens. Hedging may reduce the currency-related drag on investment returns, but it can also limit gains that unhedged investors might receive when the Canadian dollar weakens.

Investors must also consider each fund's expenses and the costs associated with maintaining currency hedges.

Amazon Offers a Different Way to Invest in US Stocks

Canadians can also invest in Amazon without directly converting their savings into US dollars through its Amazon.com CDR (CAD Hedged), listed on the Toronto Stock Exchange under AMZN.

The receipt provides fractional beneficial ownership in pooled Amazon shares and includes currency hedging to reduce exchange-rate exposure.

Amazon's third-quarter results, released on 29 October 2026, showed 39 per cent annual revenue growth at Amazon Web Services and 11 per cent growth in advertising services. However, these gains do not guarantee future returns, and investing in one company carries concentration risk.

According to CIBC, its CDRs have no ongoing management fees, but currency hedging incorporates an average spread of up to 0.60 per cent annually.

Hedging can also cause returns to differ from those of Amazon's underlying shares, potentially by more than the spread itself. Investors should weigh these costs and