Need Balanced DAC with optical and coaxial inputs for 2 channel home theater system

For my 2 channel home theater system (only), I am considering replacing my Musical Fidelity M1 DAC A with a better sounding DAC.  My needed inputs are one cable box using optical and one Sony Blu-ray player using coaxial.  I need balanced outputs (XLR) to connect the DAC to my Ayre AX-7e integrated amplifier.

The Wyred 4 Sound DAC-2 ($1,500) and the Parasound Zdac DAC ($2,500) are on my review list.  Any comments on these units?  Or, what other DAC's should I add to my list?   Considering my two input sources, will I really get better sound if I replace the Musical Fidelity M1 A DAC?

The sound quality using the Musical Fidelity M1 DAC is much better than than using the cable box RCA outputs direct to the Ayre AX-7e amp (my system is wired using both options using the source switch on the M1 DAC).  

Since the Parasound Zdac v.2 DAC is priced at $2,500 that is my top budget but I really prefer to keep the cost under $2,000.  Your comments and suggestions are appreciated.

I heard very high praises for Yggdrasil.  With 15 days no question asked return policy, you got nothing to loose except two way shipping cost.
Hi Lalit, Thanks for the above suggestion.  I also received an email suggesting I look at the NAD Masters M51, Essence HDACC DAC and the Benchmark DAC1 HDR.  
I have received suggestions for the "Schiit" Yggdrasil, Lyngdorf TDAI 2170 ($5,000 integrated amp with DAC), NAD Masters M51 DAC, Wyred 4 Sound DAC-2 DSDse ($2,600) and the exaSound e22 DAC $3,500).  I am sure all of these DAC’s are excellent choices and I am still reviewing my options.

Since I am using the Ayre AX-7e integrated amplifier, I looked at the Ayre Codex DAC but it has USB and Optical (Toslink) inputs only.  My Ayre retailer recommends I change my cable box connection from the DAC to the TV since it eliminates the need for the coaxial input.  I can then use the Ayre Codex DAC. This means I connect my TiVo cable box using HDMI to the TV and use an optical cable from the TV to the DAC. This simple solution eliminates the need for the coaxial connection, simplifies the wiring and eliminates the need for switching sources on the DAC.  Does anyone have any comments on this type of connection?

I like the synergy between the Ayre AX-7e amp and the Ayre CodeX DAC.  Another retailer highly recommends the exaSound e22 DAC and has offered me an attractive price. I have never heard of exaSound Audio Design before his recommendation. exaSound Audio Design was founded by a group of Canadian audio enthusiasts who also happen to be electronics engineers, software developers, musicians and entrepreneurs. Their hardware and software is designed in-house from the ground-up. exaSound products are hand-built and engineer-tested in Canada.   Based on my positive experience with Ayre products, my gut reaction is to buy the Ayre Codex DAC.

Does anyone have any comments on the exaSound e22 DAC vs. the Ayre Codex DAC?   Any comments are welcomed.  Thanks.

I just purchased the Mytec Manhatten.  I haven't heard the others on your list.  I suggest you give that a look.
I changed my mind.  I am going to pass on the Ayre codex DAC (USB and optical inputs only) since I have decided to keep the optical cable going from my TiVo cable box to my DAC.  I do not like using an HDMI cable from the cable box using to the Pioneer TV and then an optical cable going to the DAC.  I prefer the audio signal coming direct from the cable box to the DAC using one optical cable.  The Wyred 4 Sound DAC-2 DSDse DAC looks very interesting to me.  Does anyone have any comments about this unit?

I love my's a killer DAC.   I am using it in a Sub/Sat speaker system and it great with movie soundtracks.    TV, Netflix, BluRay all sound awesome through this DAC .   What was really suprising is how well Pandora sounds through it,  much better than through my OPPO 103d.   
I wouldn't take the Codex off your list just yet, until you had chance to listen to it.  I recently finished burning in my Ayre Codex DAC and after 500 hours, the music the DAC produces is exceptional. I agree that the number and types of inputs are not ideal, the sound this device can produce is unbelievable. Well worth it for me to work inside it's input limits.  I've heard many DAC ranging from $300 to $10000 and Arye has made something special with this model.  Honestly, I get more impressed everyday.  Personally I think it sounds better than the Ayre QB-9 DSD.   Someone told me to wait until it gets to 700 hours and the DAC will sound even better....I can't wait.  I would definitely recommend that you go and hear a demo before deciding.  If possible, go and listen to a bunch of different DACs before buying one and bring a CD you know intimately; one where you can notice the differences in the sound.  Good luck!  
Hi Nycjlee, I agree the Ayre Codex is an excellent DAC and I wish I could buy it. However, the sound quality on my 2-channel home theater system is much better when going "direct" from my TiVo cable box to the M1 DAC and not running the HDMI cable to the TV and then an optical cable to the DAC (as needed for the single input on the Codex).

Another important item is that I need to easily switch the DAC in and out of the system. I cannot do this if I connect the TV direct to the DAC. Based on my research so far, the Wyred 4 Sound DAC-2 DSDse has gone to the top of my list for more research. I have spoken to them several times and they have been very helpful. I heard their equipment at the 2015 THE Show in Newport Beach and liked it.

I am disappointed the two current Ayre DAC models (QB-9 & Codex) do not support both optical and coaxial inputs. The new Ayre model scheduled to be announced shortly is probably more than what I want to spend. Thanks again. Cheers, Howard
From what I have read and what I have been told by owners who did A/Bs the $869 Gustard X20 has sonically eclipsed the Yggdrasil, Wyred for sound DAC 2DSD SE, Nad 51 and Ayre QB-9.  I do mods on the Gustard so you can take that into consideration.....However, all the A/Bs were done with both units stock.   
Did I miss something?  I thought the Parasound Zdac is only $500, yes the version 2.
Based on my research, the NAD Masters M51 DAC is now at the top of my list.   I considered the W4S DAC-2dsdSE DAC and the exaSound E22 DAC but for the money the NAD M51 DAC looks very good.  I am planning to demo a unit shortly. 

As I understand it, I could run HDMI from the TiVo cable box to the M51 DAC and run another HDMI cable from the DAC to the TV for video only.  My Sony CD player would also connect HDMI to the DAC. The DAC runs balanced cables to my Ayre AX-7e amp.  I think I might be better off keeping my existing cable connections and forget the HDMI.  The HDMI cable carrying video might be better going straight from the cable box to the Sony TV.   Any comments?

Do you have any additional comments on the NAD M51 DAC? 

I have my TV connected via the M51 and HDMI from the cable box to the TV, that way my wife and kids can watch TV independently from the stereo.   My Blu Ray is via HDMI to the M51 and I plan on connecting a Bluetooth Receiver to coax.   
It is a good thing I am in no hurry since I changed my mind again on a possible DAC selection.

The exaSound DAC e22 Mark II ($3,500) has gotten great reviews but it is expensive and I prefer to buy from a USA Company. This unit is very interesting but I prefer not to have two boxes in my family room.

The Wyred 4 Sound DAC-2 DSD SE is very good but it is priced beyond what I want to pay ($2,765).  

The NAD Master M51 DAC ($2,000) seems to be popular but I had problems getting pre-sale product information.  If I have a problem with the M51 pre-sale info, getting after sale technical support could be a problem. In addition, I prefer a USA made product.

The Ayre QB-9 DC and the Ayre Cordex DAC are both excellent products but neither has the necessary optical and coaxial inputs I require.  As I stated above, I am not willing to change my wiring connections to HDMI as required by the Ayre Codex. I am disappointed the Ayre DAC's do not have the two input connections I require.   

The Benchmark DAC2 HGC has been highly recommended by friends and it looks excellent. It is made in the USA and priced at $1,999. The unit has four balanced 32-bit D/A converters that are summed together to create each balanced analog output.  Does anyone have any comments on the Benchmark DAC2 HGC?

It seems I am changing my mind every week but this is based on new facts and product information. I am reading all the various posts and reviews I can find.   Once I decide on a product, I will bring it into my system to see how it sounds.  Thanks again for all your help.
demoed at home for 2 weeks the Benchmark Dac2 and Mcintosh D100, kept the Mcintosh, it's beautiful.  New D150 (same as D100 but does DSD) is $3k.

good luck

 Here is a solution for multi source coax and opt inputs with Opt output for convenience while still maintaining Ayre Codex level performance.
   1177A zu opt/coax switcher.
Hi audioconnection,  Thanks for your suggestion for a optical/coaxial switcher box.  It is an interesting concept but I prefer not to add an addition box to my family room cabinet (and prefer a single box solution).

After additional review, I decided to pass on the Benchmark DAC2 HGC because it is NOT FULLY balanced AND requires the DAC’s internal jumper cables to be adjusted to match my Ayre AX-7e integrated amplifier.  My Ayre AX-7e integrated amplifier requires a high quality balanced input so I need  fully balanced DAC. 

I am now researching the Wyred 4 SoundDAC-2 DSDse. It is fully balanced, has good quality sound, has XLR outputs including optical and coaxial inputs. The reviews are very good and it should work fine in my 2-channel home theater system.  Thanks again for all your help.  

If you like laid back,lush, and polite sound take a look at the Luxman DA-06.  A Japanese version can be had on Ebay for about $2800.  

I had the Nad M51 for a week to demo. There was a lot of good going for it but I thought it was not worth $2000 but definitely $1100 used. It is lacking in the lower frequencies and uses a switching power supply vs linear.  It easily bested my Oppo HA-1 but was no where close to my Lite Dac 60 that I modified heavily.  BTW, the Lite Dac was the best audio purchase I ever made. 
A comment of limited help, perhaps.  Anyway, I have a PS Audio PWDII and really like it.  I haven't compared it to your other options, but they're going for between $1000 & $1500 and I really like mine.  I've only compared it to their award winning DSD, but actually preferred the PWD (enough to re-buy one).  I thought it sounded more natural, definitely a better fit for my system (coincident speakers/amps), other ears agreed.  In any case, with the DACs pushing down the price, they're a good deal right now.
P.S. I’m in a similar two-channel w/ TV & movies (the last Kuro Plasma) situation. I run a macmini (usb), PS4 (optical), DirecTV (coax), & cd/dvd player (xlr coax) through mine. All are both audio and video sources. 
I have the essence HDACC.

You can extract high resolution audio from blu-ray and DVD via the HDMI input and output.

As a stand alone DAC, I am very impressed with the sound quality.

That said, there are no returns or refunds as all sales are final. The unit will be replaced for warranty issues only. 
Hi Zipbang, Are you saying that the Essence DAC HDACC allows me to run a HDMI cable from my cable box to the Essence (video & audio) and another HDMI cable fro the Essence DAC to my Pioneer Plasma TV for video?   I would then run balanced cables (XLR) from the Essence to my Ayre AX-7e integrated amplifier for the audio.  Will the use of a HDMI cable from the cable box to the DAC to the amplifier result in higher sound quality (than my optical cables)?   My Sony Blu-Ray player will continue to use a coaxial from the Sony to the Essence DAC for audio (already has HDMI to the TV), correct?

As you have already seen, you're going to get lots of opinions and recommendations. Honestly, there are so many good sounding DACs out there, you're just going to have to narrow it down based on reviews and take a leap of faith, or buy something new from a dealer who has a trial period. 

That said, I will add one more suggestion to the mix: I recently switched from a Parasound ZDAC (which I liked a lot) to a PerfectWave DAC II,  which I absolutely love. I am running it straight into my amp (Parasound Halo A21) and it sounds wonderful. Good luck! 
I'll recommend one more: the Wyred 4 Sound DAC-1 LE with the Femto clock and super cap upgrade options.  At $1,274, it is much less expensive than the DAC-2 DSD SE, but is very similar; no remote option and has a different display.  I do have this and think it is very good, but to be fair, I have not heard the DAC-2 SE.
Thanks again for al the above suggestions.  I have added the Resonessence Labs Veritas DAC to my list ($2,850).  Resonessence Labs latest Audio DAC product, VERITAS, will start shipping shortly.  The Veritas DAC includes the new ES9028PRO series chip.  The VERITAS DAC includes USB Audio 2.0, DSD and DXD, XLR outputs, RCA outputs, Optical input, etc.  The exact specifications are expected to be posted to their web site soon (maybe at the end of the month).

I am going to THE Show in Newport Beach (June 3-5) and hope to audition various DAC's to help me make the right decision.  In any case, I will borrow a DAC to use in my home system to ensure I make the right decision.  Thanks again.
At THE Show I discovered Prism Sound.  This was the first time I heard of this British company.  I listened to their Callia DAC every day, enjoyed the sound quality and asked them many, many questions.  They were very helpful and answered every question I asked, in detail.  The Callia DAC is fully balanced and includes USB, optical and coaxial inputs.   It also has XLR outputs for connecting to my Ayre AX-7e Integrated Amplifier.  The Callia DAC also has a volume control and a 2nd volume control for a headphone.   Please see:

I was very impressed with musical sound quality and also the people from Prism Sound.  I ordered the Prism Sound Callia DAC and it is expected in three weeks (estimated).   

Some of these DAC's mentioned above were not brought to the show, or were damaged in shipment or I did not like their presentations.   I wanted a DAC from a strong, experienced company that would support me and their products.   Of course, the main thing is the DAC had to sound excellent and have the input connections I needed.   These are some of the reasons why I purchased the Prism Sound Callia DAC.   Thanks again for all your suggestions above.
My Prism Sound Callia DAC arrived and installed perfectly.  I had a couple of operational questions and Prism Sound Customer Support answered them very quickly.  The Callia DAC sounds very good but, yes, it needs more burn in time before I can comment. Please see:

The Callia includes a volume control for direct input to a power amplifier. Unfortunately, I cannot use this since I need to control my volume using my TIVo remote. My Callia DAC is running balanced into my Ayre AX-7e integrated amplifier.  My sources are my TiVo cable box and Sony Blu-ray player.   The Callia DAC is small (285x242x50mm including feet) and is a very nice looking unit.

The Callia DAC comes with a Quick Start Guide and the Operation Manual is on the USB that is delivered with the unit. The stick contains the manual and a software tool that will enable you to load firmware updates in future. You need not install the firmware loader tool until you need it, but you should take care not to lose the stick. It will also be possible to download the loader tool from the website. There are no updates as yet. The Operation Manual is excellent and I strongly suggest you read it. It contains useful information when you plan on using a PC or MAC computer.

For standby mode, press and hold the button on the right for about 5 seconds then release. Since I am using the volume control on my Ayre AX-7e integrated amplifier, I wanted the Callia DAC volume control disabled. This means you set the DIP switch #1 to “OFF” (Up) on the back of the unit. This is very easy to do (use a paper clip) and worked fine.

My unit is set to the automatic mode and defaults to the incoming signal. In automatic source selection mode (indicated by the 'Auto' LED being lit), sources are selected automatically according to sensing of valid audio at the inputs. In automatic mode, the current source remains selected until it is silent (or otherwise absent) for more than four seconds whilst another input is playing - in that case the other input is selected. The four second delay is to prevent spurious switching during silences between tracks.  If needed, you can also set the input direct to the source (bypass automatic mode selection).

The Prism Sound Callia DAC is sold direct from Prism Sound. I have owned the Callia DAC for one day and already like it very much. It is very easy to use and their customer service is excellent. My Callia DAC needs more time to break in but it does sound very good and I recommended you give it a listen.