Q: Hello, I wanted to start a small position in AAPL, but didn't want to convert CDN $ to US$, would you recommend the CDR? . I noticed that since the beginning of the year both the CDR and the US listings are down about the same ~ 16% .. Are there any hidden fees with he CDR . Or would you recommend to just buy the XQQ:CA?
Thanks
Carlo
Thanks
Carlo
5i Research Answer:
CIBC does charge an f/x hedge fee, which is somewhat hidden and deducted from net asset value on its CDRs. We can't really compar an ETF such as XQQ to a single company. XQQ does have 7.3% exposure to AAPL. The CDR vs AAPL is basicall a currency call. If an investor believes the C$ will see strength then the CDR will outperform AAPL. We are comfortable with either. Generally, we see currency as another form of diversification and would side with the US version.