Buy rate, sell rate and spread: how to read an exchange rate

Why are there two rates?

On our exchange rates page, each currency has two columns, from the customer's point of view:

• Buy: what you pay, in Canadian dollars, to buy one unit of the currency. This is the rate when you're leaving on a trip.

• Sell: what you receive, in Canadian dollars, when you sell us one unit of the currency. This is the rate when you come back.

The buy rate is always higher than the sell rate. The difference between the two is the counter's margin.

Careful: some counters post their rates from their own point of view ("we buy / we sell"), which flips the words. When in doubt, just ask: "How many Canadian dollars for US$500?"

What is the market rate?

It's the rate at which big banks trade currencies with each other, halfway between supply and demand. It's also called the interbank or mid-market rate. The Bank of Canada publishes a daily average rate every business day, a good benchmark for comparing.

No banknote counter sells at the market rate: physical banknotes have to be shipped, insured and stored. But the closer a rate gets to it, the better for you.

How to calculate the spread

The formula is simple:

Spread (%) = (rate offered − market rate) ÷ market rate × 100

Example with made-up rates: the market rate is C$1.38 per US dollar and you're offered US dollars at C$1.41.

(1.41 − 1.38) ÷ 1.38 × 100 = 2.2%

On US$1,000, you pay about $30 above the market rate. That's the number to compare from one counter to the next.

What does "no commission" mean?

That no fee is added on top of the rate. The cost of the service is then entirely in the spread. A "no commission" counter with a 6% spread costs more than one with a 2% spread and a small flat fee.

At ClickExchange, there is no commission or service fee on currency exchange: our margin is the spread, shown in our rates.

Why does the rate change between booking and pickup?

Rates follow the market throughout the day. When you reserve online, the rate shown is an estimate; the rate applied is the one in effect at pickup. For a large amount, check today's rates just before you come in.

Frequently asked questions

Why are rates worse for less common currencies?

A currency in low demand costs more to source and stays in stock longer, so its spread is wider than for the US dollar or the euro.

Does the amount exchanged change the rate?

It can. Our posted rates are estimates and may vary depending on the amount actually exchanged.