Cambio at the airport

So I should shop around and compare rates at several cambios? It seems more efficient to go to an ATM where I know I will get the current “spot rate.”

As mentioned in one of your subsequent posts, this only works if you are in an area where there is an "efficient market" for pesos and dollars. Economists refer to an efficient market as a place where there are sufficient buyers and sellers to encourage healthy competition and price discovery. Airports and tourist locations are not efficient markets. Very good rates of exchange can be found in the Casas de Cambio along the San Diego / Tijuana border. Here is a presentation about how the Casas de Cambio use the "spread" between what they buy and sell pesos and dollars to earn their living.

This is exactly the same way that brokerage firms such as Robinhood earn their money. Instead of charging a commission, they get a kickback of the "spread," the difference between what the dealers/market makers are charging when they sell the stocks to the general public (the retail price called the ask price) and what the dealers/market makers pay when they buy the stocks from the general public (the wholesale price called the bid price). Sadly, many younger folks have become deluded into thinking that they can trade stocks and other securities to their heart's content since they trade for free. Wrong!

Why go to the bother of shopping for the best rate of exchange at the Casas de Cambio? Don't forget that ATM actually stands for Always Taking Money. Some of the ATM machines in Mexico charge upwards of $8 or $9. HSBC was guilty of this but I think they may have lowered their fees. And they put a limit on how much you can withdraw in a single transaction so you will be going back to the well to be pinched again all too soon. Some folks have reported that a few banks such as Schwab's bank cover your ATM fees no matter where you are in the world. I find this hard to believe but if it is true, then this is certainly one option to pursue.

Your Humble Fellow Zihua-Lover is Truly a Lucky Gringo. Many years ago before they stiffened the rules, I was able to score a Bancomer (now BBVA) account. As long as I keep MXN$4,000 pesos in the account, there is no monthly fee. When the exchange rate in San Ysidro becomes attractive, I run to the credit union in San Diego, run down to the Casas de Cambio, exchange the money, and then run back across into Tijuana and deposit the pesos. The exchange rate is often better than services such as Xoom or TransferWise (now called Wise). There is a BBVA ATM in virtually every corner of Mexico. Hence, I am able to withdraw pesos anywhere in Mexico with no ATM fee. Lucky Guy!