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Trading only USD stock on ISA account. Need clarification on currency conversion


tuquoge5401

Question

Can someone help clarify my understanding on the currency conversion?

Background

1. I have share dealing account and ISA share account.

2. Completely new accounts created this month.

3. I intend to trade only the US stock for now.

Questions I have

1.  I made a transfer with USD to my account, referencing my ISA account id. But the money is transferred to the share dealing account, not ISA account. Is this expected? (but this probably doesn't matter as I can easily move money between 2 accounts)

2. The money is auto-converted to GBP. From my research, it seems impossible to set a base currency to USD for these 2 types of accounts. So is it correct that I cannot avoid such auto-conversion?

3. If I move GBP money to ISA account, then buy a US stock. When I sell the US stock, will I get back the money in GBP or USD? i.e. If I buy a US stock, then sell, then buy again. How many conversions will it happen?

Thank you very much for answering!

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Hi @tuquoge5401

Thanks for the query. 

1. That should not be the case, if you correctly reference your ISA account ID then the funds should be deposited to your ISA account. Yes you can however easily move the funds between the accounts. 

2. Yes one cannot change the base currency on a share dealing or ISA account. You can however convert your share dealing account into a multi-currency account. This will allow you to hold multiple currencies in your share dealing account. Making it possible to deposit in USD without the need for conversion fees. To make this change go to My IG>live accounts>currency conversion. Then change from instant to manual. Before making this change be aware that it will disqualify you from commission discounts as mentioned in the following link: https://www.ig.com/uk/investments/share-dealing/costs-fees. Multi-currency account is not permitted on the ISA account. 

3. On the ISA account the funds will be auto-converted every time you trade US stocks. That would mean the funds would be converted to USD when you buy then back to GBP when you sell.

All the best, 

Anda 

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