any experience buying foreign ETF i.e. PSHZF

ET91

Hi all, I am wondering if anyone has experience buying a foreign ETF such as PSHZF. I tried Vanguard and they refused my trade. I tried TD Ameritrade. First they said: You do not have enough available cash/buying power for this order due to recently deposited funds still on hold.|Only closing orders are accepted on foreign ETFs. Now TD is saying: Order rejected:Only closing orders are accepted on foreign ETFs. I tried to put a limit order. What does the latest statement mean? Thank you for your help. This is with regard to Pershing Square Holdings, Ltd (PSHZF) which is trading at a large discount but price is up today as Barron's had a favorable article recently.

JD_co

Fidelity will let you purchase this security, but they charge a $50 "foreign settlement fee" for each Buy.

msf

PSHZF is a closed end fund. There may not be a difference in how brokerages handle ETFs and CEFs, but they are different from an investment perspective. Vanguard's VERX is an example of an ETF on the London Exchange.
https://www.vanguardinvestor.co.uk/investments/vanguard-ftse-developed-europe-ex-uk-ucits-etf-eur-distributing

Fidelity provides three different ways to trade international securities: directly on a foreign exchange with foreign currency, on a foreign exchange with trades denominated in dollars, and domestically if the foreign stock is traded OTC. See pp. 3-4 of the brokerage commission and fee schedule.
https://www.fidelity.com/bin-public/060_www_fidelity_com/documents/Brokerage_Commissions_Fee_Schedule.pdf

One could purchase Pershing Square Holdings, Ltd in pounds sterling directly on the London Exchange via the ticker PSH:GB. When traded this way, there's no $50 added fee, but Fidelity does charge a £9 commission as well as a currency exchange fee.

You seem to be writing about the third method (OTC). Even there, a $50 fee is not always added. It depends on whether the DTC can process the transaction. For example, one can trade another UK CEF, Scottish Mortgage Investment Trust PLC under the ticker STMZF without incurring a $50 fee.

Here's a list of the 30 largest UK CEFs (Pershing is #6):
https://www.londonstockexchange.com/discover/news-and-insights/discover-london-listed-investment-funds-market

ET91

Thank you JD_co and msf for your replies. I got an email back from TD Ameritrade saying that I can't buy PSHZF there. It looks like the price of PSHZF is increasing now and it looks like a hassle to buy. I guess I will not pursue it further. I am still waiting to hear from Vanguard brokerage.