Direct transfer from US USD to HKD in Hong Kong?
Or transfer US USD to USD in Hong Kong, then do the exchange?

What I found out is you are better off doing the second option.  Don't do any kind of money change when transferring, the rate is better if you exchange currencies at the target bank.  These are my findings from HSBC US to HSBC HK, USD to HKD conversion

Direct Deposit for HK Accounts

Setting up direct deposit is a bit more complex in Hong Kong. They will want the Bank Code, Branch Code, and account number of your account. Here's how to find these numbers in HSBC account statements, but should be applicable to other HK banks.

For HSBC, the bank code is 004. You will need to look up your bank code on the internet (this link was useful for me: http://www.sfaa.gov.hk/pdf/common/Form/tsfs/Bank%20Code%20List%20(as%20at%2029.1.2010).pdf )

For the branch code, check your bank statement. It should be the first 3 digits of your full account number.

Your account number will be the middle 6 digits of your bank statement.

To deposit into savings, the last 3 digits for Premier is 888 (PowerVantage is 833). I wanted to deposit into checking, so my last 3 digits was 001.

In total you should have:

3 digit Bank Code

3 digit Branch Code

6 digits for your account number

3 digit account type (001 Checking or 888/833 Savings)

Applying Game Theory to a Sunday Night return from Macau

Sunday nights around 11PM at the ferry terminal in Macau are chaotic, where you can see groups of people moving from gate to gate. At this time, there are ferries leaving every 15 minutes or so, and there are way more prospective passengers than available spaces on each boat. I arrived at the ferry at 11PM, but could only get a 2:30 AM ticket. Now what?

People who have tickets for the proper time have no problem getting on, but the ticket vendors allow you to use tickets purchased for later times on earlier ferries. To do this, you need to wait on their standby line. This allows them to fill up each ferry to capacity even when there are no-shows.

The problem is there's a magical cut off in the standby line after which no one gets on. As the time nears for the ferries departure, the inevitable late comers arrive and fill up seats on the ferry. Ticketholders are allowed to board right up till the scheduled time of departure (the ferry actually leaves around 5 minutes after the scheduled time). Only after the scheduled time are the hopefuls from the standby line allowed to board.

Some thoughts:

• Standby lines for the ferries soonest to depart are the longest.
• You can look into the waiting room for each of the gates to gauge how full they are... but they all get pretty full even 15 minutes before leaving (standing room only)
• There's no sure fire way to know how many standby spots are available, BUT I don't think you need to know this to have a good strategy.
• People on standby lines often have tickets for the next outbound ferry (I saw a fair amount of people holding the 1230 ticket on the 1215 standby line). If you know Cantonese you can try exchanging your ticket for theirs, as any future ticket is valid for the standby line. They lose nothing and you get a ticket for the next ferry.
  

From my experience, there's on average 10-20 standby spots available per ferry. This is a small number considering the standby lines can get to be 100 persons long or more. However, from my experience, most people do not know this (Game Theory's Nash Equilibrium doesn't exist at the ferry terminal). You can use this to your advantage.

The size of the standby lines dramatically decrease the further out the scheduled time to depart is. I've found that ferries 30 minutes ahead have decently short lines.

In looking for a standby line, I would look for any line that is dramatically shorter than the one immediately earlier than it. However, if this line still has 30 or more people, go ahead to the next line.

Investment Stuff - alpha, beta, sharpe ratio

The HSBC fund fact sheets have all these figures that I didn't know what they meant, so I did some googling and found out.

Alpha - The higher the better. A positive alpha means this fund outperformed the benchmark by that percentage (1 = 1 percent better). A negative number is bad.

Beta - measures volatility. The lower the better. A beta of 1 means this fund is as volatile as the market. Utilities and bonds have a low beta, tech stocks have a high beta.

Sharpe Ratio - higher the better, measuring risk adjusted performance. Wikipedia has a good example so I'll just plagiarize here:

"As a guide post, one could substitute in the longer term return of the S&P500 as 10%. Assume the risk-free return is 3.5%. And the average standard deviation of the S&P500 is about 16%. Doing the math, we get that the average, long-term Sharpe ratio of the US market is about 0.4 ((10%-3.5%)/16%). But we should note that if one were to calculate the ratio over, for example, three-year rolling periods, then the Sharpe ratio could vary dramatically."

So you should look for funds with at least a Sharpe Ratio of 0.4, if not more.

The ideal fund would have a high alpha, low beta, and a high sharpe ratio. In English that means you want a fund that outperforms its benchmark, has low volatility, and has a higher risk adjusted return than the S&P 500 (10%) as compared to 30 year Treasuries (3.5%).

Best way to automatically invest if using HSBC in HK

First, if you go to the branch and talk to a wealth manager, they will steer you towards their Wealthinvest Insurance plan, which blows.

Of course, what's not clear online is the 'early encashment charge' which is what they charge you if you withdraw before 10 years. During year 1, it's 50%, and it rapidly goes down (50%, 30%, 21%, 17%, 14%, 12%, 10%, 8%, 6%, and finally 0%), but it's definitely not flexible. Add on top the 2% fee/year you are paying for their platform, and you can quickly conclude that this is not a good plan.

The better plan (which they will steer you away from) is the Unit Trust Monthly Investment Plan. The reason they will use is that you will get charged 5% every time you buy a fund. Of course, they neglect to mention (and they tell me actually that you can't actually buy) their no fee funds with the UTMIP :

The 27 No Fee Unit Trusts available from HSBC HK as of 6/23/2011

The UTMIP plan can be stopped at anytime (I set mine to stop after 1 year automatically), has a 1000 HK minimum per fund, and if you buy the no fee funds there's no 5% fee. You only pay for the funds management fee (which is the same with Wealthinvest) and if you stop before the year is up there's another 1% charge.

This is a much, much better deal than the Wealthinvest plan. The Wealthinvest plan is only worth it if you love the 44 funds in the plan they are offering, and don't plan on touching it for 10 years, and like the idea of paying for some capital preservation insurance if you die (basically, if the amount of investments goes below your principal and you die within the 10 years, there's a death benefit that covers the difference, up to 500k USD).

I emailed my wealth manager a screenshot of my confirmation screen buying my no fee fund of choice using UTMIP, just to make sure he knows for sure that what his colleague was telling him was not true.

Just changed RMB

Went to the HSBC counter here in Tsuen Wan. The rate I got was 117.150.

According to google, the spot rate today is 116.695734.

So I paid about 4/10ths of a percent

Buying RMB

There's some things you should know if you are trying to buy RMB in Hong Kong.

Generally, you can only buy RMB with HKD. Any other currency you want to use to buy RMB must be converted to HKD first.

Then, there's a daily purchase limit of 20k RMB per day for HSBC (and BOC HK, and probably all other banks). Yes, there are restrictions even though the RMB account does not reside in China.

The rate you get if you buy RMB at HSBC isn't as good as the street money changers. The difference is negligble though - only a .1% difference last I checked (.874 from HSBC vs .875 from money changer). In total, it's a .6% charge from HSBC vs a .5% charge from street money changer compared to spot rate.

However, the main benefit to using a money changer is that they don't care about your identity, so you can change as much as you want at a time (provided they have the cash). This means you will be carrying cash though, so depending on your situation it may not be worth it.

Here are the 'indicative rates' from HSBC for today 3/15/10:

1 USD = 7.745993385 HKD from USD to HKD

1 CNY = 1.144 HKD from HKD to RMB (You get 874 RMB if you exchange 1000 HKD)

Here are the spot rates according to google for today 3/15/10:

1 USD = 7.75819265 HKD

1 RMB = 1.13651316 HKD (You get 875 RMB if you exchange 1000 HKD)

Best way to move money from US to HK

There's a couple of ways to move money around, but some are better than others.

From doing some internet research and some of my own investigation, here's the best way to do it if you use HSBC.

First, for your local Hong Kong HSBC account, be sure to setup a USD denominated account. You will transfer money to this USD account first. There should not be any charge for this service (if you transfer 10k from your US HSBC account, 10k will appear in your HK HSBC account). I transferred money using the Global View feature of my online account.

Now, if you were to try to do a transfer from your US HSBC account into your HK HSBC account directly from USD to HKD in one shot (transfer initiated from your US based online account), the charge will be about 1% over the current spot rate.

If you instead transfer from your US HSBC account to your HK HSBC account as USD first, then exchange from USD to HKD locally (using your HK based online account), the charge is about .15% over the current spot rate.

PCCW Blackberry Enterprise Service now charging for GPRS data

Be sure to get the 18hkd/month 30mb plan for local gprs data if you use Google Maps or any other 3rd party application that uses data, as grps data is now being billed. This was not the case previously.

There is no such plan for non-local data, so if you are overseas try to restrict your usage to plain blackberry browser usage.

Kodak Fotomax to print and scan documents

Lots of people in Hong Kong don't have a printer/scanner. I sure don't. So when HSBC emailed me some documents to sign and email back, I had to find a place to do it.

Luckily, my local Kodak Fotomax center which is usually a place to get photos developed can also print and scan documents off a thumb drive.

The cost is modest - $8 HKD per document to print (no minimum), and $10 HKD per document to scan, minimum of 3.

The scanned documents get burned onto a CD, which explains the minimum charge... I asked if they could just put the scanned docs onto my thumbdrive, but the staff said that they normally burned the scans onto CD.

Everbank sucks

I thought they were the solution to my overseas banking problem... but they aren't.

I am in the process of closing my Everbank because:

They've been silently charging me USD $9/month on my yield pledge money market because they changed their balance requirements back in June '09. Gee, it would have been nice to get notified, don't you think?

They also now charge for online bill pay if your checking balance is below USD $5000. Gee, when did this start happening?

Direct deposit counts for nothing? No problem.... I'm shutting it down and direct depositing with my HSBC account. This will also allow me to build an income history for when I want to take a mortgage out here in Hong Kong.

Details on HSBC Premier Credit Card and ATM (Debit) Card

Direct from my US Relationship Manager:

The Premier World Mastercard credit card has a 0% foreign transaction fee, 0% interest on purchases for the first year until December 2nd of 2010 and almost 20% interest on cash advances (not recommended of course since all credit cards have a high APY when you do a cash advance).

The debit card will not incur a foreign transaction fee when you withdraw money from other banks internationally since it is a Premier card but the other banks will charge you a per withdrawal fee. If you withdraw from HSBC HK, you will not incur any fees whatsoever.

Our Premier Support team stated that Hang Seng may not be reimbursed.

EMS SpeedPost = USPS Express Mail International

For people sending mail to the US via Hong Kong's EMS SpeedPost, the tracking number given is usable at the usps.com (US Postal Service) website once the package arrives in the US.

Of course, the Item No is trackable at the hongkongpost.com website.

Once your package arrives in the US, you can track it using the hongkongpost.com website or the usps.com website. The usps.com website will provide more info however.

For my package, USPS attempted a Saturday delivery to the title company which of course was unsuccessful. Additionally, a delivery notice wasn't left, so the title company had no reference no. to use to track the delivery attempt. I had to keep tracking the usps.com website and notify the title company that the delivery was unsuccessful, at which point someone from the title company went to their local post office to pickup the package. They had to email usps.com to get the reference no first.

Notes on getting documents Notarized in Hong Kong

I got my HSBC closing docs a week ago and had to get a few of the docs notarized. Here are some of the things you should know.

1) You should first make an appointment to get your docs notarized at the US Consulate. You actually can walk in without an appointment (I had to do this since one of my docs wasn't marked properly so I had to go back for a walk in). They have a lunch break from 12-130PM so they'll make you wait outside until 130PM, then they give you a plastic placard to show that you are a walk-in.

2) It costs $30 USD for the first notarized document, $20 for each document thereafter.

3) Go through all your docs to make sure you know what you need to get notarized. Two of my docs had yellow stickies signifying that I had to get them notarized. But as I was signing and initial'ing the rest of my docs at the post office, I found one additional document that wasn't stickied at all. I ended up having to go back to the US Consulate the same day, without an appointment to get it signed. This added 2 hours to my ordeal.

4) While HSBC doesn't require your last two years tax returns, one of the forms they'll have you sign is a release giving them permission to get tax return transcripts direct from the US Government. I guess this is actually better for them as there's no opportunity to forge documents.

5) I paid HKD 127 to send the closing documents back to San Francisco by SpeedPost. They say it takes 3 days to get delivered, but in actuality, it takes 3 days to get back to the US and pass customs. From there it gets delivered to the local post office and delivered. If you take the breezeway to the Central Post Office, you'll need to go down one flight of stairs to send the parcel via SpeedPost as those are sent out from the ground floor.

Corner money changer exchange rates HKD to RMB

The local money changer was offering to buy 1 HKD for .880 RMB.

I checked google and the spot rate at the time was 0.880902804 RMB per HKD. So I think the local money changer gives a pretty good rate.

Overall I did the calculation... I paid 1137 HKD for 1000 RMB... if I went by the actual spot rate it would have cost 1135 HKD... so not even 2/10ths of 1 percent of a mark up!!

HSBC Premier Part 2

I opened an HSBC Premier account with 100 dollars cash, with the understanding that my 5/1 Interest Only 500k loan is pretty close to being funded.

Some issues though:

1) The appraisal came in at 770k, but since there were no furnishings, the appraiser marked the unit as 'vacant' on the report. This will need to be rectified before the loan can be funded.

2) I will need to write a letter to explain why there are no furnishings and to confirm that I will in fact be living in the unit.

As for ordering (whether I can get the loan and the discount prior to opening an HSBC Premier account), the answer is:

The loan officer needs to refer to the HSBC Premier account number when finalizing the loan in order for the discount to take effect. I started the loan process first but then a week later went into their office on 601 Montgomery to open the HSBC Premier account (you have to physically meet with a relationship manager before they can open the account).

So, the ordering I guess is flexible since the loan process takes so long...and there are a fair number of steps before they'll even send out an appraiser.

I had to supply the following to start the loan process:

-Copy of 2007 & 2008 W2
-Copy of October and November paystubs
-Copy of 2 months bank statements of bank accounts
-Copy of insurance policy for condo project
-Completed Project Questionnaire attached below

Note that Bank of America requires last 2 years signed tax returns as well!

HSBC Premier

Spoke with an HSBC Premier relationship manager today in San Francisco, here's what I found out:

You can qualify for Premier with a mortgage balance of 500k from them BUT you need to have 24 months of mortgage payments (in straight checking, in IRA, in brokerage? I dunno). I'm also not sure if that 500k can be a mix between mortgage and equity line.

401k (He probably meant IRA) balance of 100k can count.

If I can get a mortgage via HSBC Premier, the mortgage application fee is waived, and I can get .25% off their best rate.

The ordering is tricky though... if I am trying to qualify for HSBC Premier via a mortgage, I'm not sure I can get the Premier mortgage benefits at the same time (meaning I need to be a Premier member before trying to get a loan).

Also need to establish 3mos to 12mos of credit history before it can be transferred to an international office.

Exchange Rates and Opening a HK Account

I brought some cash with me from the US to open an account here with HSBC. Here are the details.

The exchange rate they give you is 7.707 (I exchanged 9k USD). They said this was a favorable rate but I wasn't so sure.

I went down to the street level money changers and the rate they advertise is 7.5 HKD to 1 USD, which is even worse! I asked them if I were to exchange in bulk (1k USD) how much would it be, and even then they said the rate would be 7.6.

The going rate for that day was:

2009-01-30 Friday, January 30 7.75585 HKD

HSBC was charging .04885/7.75585. This works out to be a charge of .63%. This is actually not bad - Everbank charges a rate of 1% for an international ATM withdrawal (which is much better than the industry standard 3%). The only thing better for exchanging money is to use the Capital One card which charges 0% but isn't really a money exchange.

Withdrawing from China ATM = Bad Deal!

On top of a 3% ATM Foreign Fee charge, I got charged a flat $4.50 Non-Citi ATM Fee as well!! Here's the detail breakdown for withdrawing $1000 RMB from a Standard Chartered ATM in Shenzhen:

NONCITIBANK ATM WITHDRAWAL 07:06 3016 $ 146.94
NONCITI ATM FEE $ 4.50
FOREIGN FEE 07:06 3016 $ 4.41

CapitalOne Platinum Visa Rocks!!

Just got charged the following amount for an $80 HKD box of cookies from HK Disneyland:

November 03, 2008 HONG KONG DISNEYLAND LANTAUISLAND Merchandise $10.32

80/10.32 = 7.75

That makes it a no cost transaction!!!! WOW!