Best practice to book currency exchange for buying foreign security

Hello,

First thank you for this great software.

I have an Interactive Broker (IBKR) account in CHF (my default currency in Portfolio Performance is the CHF currency as I live in CH) and I was wondering what is the best practice and/or steps in order to book the following which as final goal is simply to buy some VT:

  1. deposit in CHF to IBKR
  2. exchange my CHF into USD by buying USD/CHF (CHF=X) in IBKR
  3. buying the VT ETF in USD using my freshly exchanged CHF

Step 1 is easy and clear but then I am already stuck at step 2… Can PP do the currency conversion for me somehow or do I need to add the CHF=X currency as security into PP? Do I need multiple deposit accounts in PP? etc…

Thank you for your help.

You would need to add another deposit account, in USD. (You can change the currency for an empty deposit account via a double click on the default currency.) Then you can transfer money from your CHF account to your USD account as normal, specifying the exchange rate that Interactive Broker used. Next, you would buy the ETF using the USD account as your reference account for the transaction.

Thank you for your answer. I already tried to do that but the problem is that the transfer function in PP is missing the „fee“. Where do I enter that commission for the exchange?

For example I bought USD 10160 for CHF 9951.51 and had to pay CHF 1.97 in commissions to Ineractive Broker.

Currently, the only option for that is to add a separate “fee” transaction (on the CHF account, in this case). You could use the comment field to explain that it was for the currency conversion.

I see, so there is an extra step I was missing in order to book the forex fee seperately using the „Fees“ option on my CHF deposit cash account.

Now I was wondering what do you typically name your deposit cash accounts when you have two different ones for each currencies? I have now named then:

  • IBKR (CHF)
  • IBKR (USD)

Sounds good? Because I guess I can’t use the same name for both accounts.