The great thing about investing is that it doesn’t come with boundaries. Even if you’re based in India, you can invest in Chinese, American, and European companies. You can buy their shares in a few different ways and be part of their success story. Investing in overseas companies is also quite profitable, which gives you the chance to balance out the losses in your portfolio.
How to invest in international stocks?
There are a few different ways to invest in international stocks. The most common methods are listed below:
1. Open an Overseas Account with Indian Brokerage
Domestic brokerages like 5paisa, Vested Finance, ICICI Direct, Reliance Money, and Kotak Securities allow investors access to foreign stocks as well. Many retail investors use this route to invest in foreign stocks. Remember, however, that the overseas trading services provided by these domestic brokerages will have some restrictions. Based on the brokerage that you go with, you might have some restrictions on certain investment vehicles or the number of trades that you can make.
2. Open an Account with a Foreign Broker
You might be pleased to know that certain international brokers allow Indian citizens to invest in securities listed on their country’s stock exchange. For instance, stockbrokers like Charles Schwab International Account, Interactive Brokers, and TD Ameritrade give Indian investors the chance to open an account and trade in US securities and mutual funds. Some foreign brokers also have offices in India, where you can go and clear your doubts.
3. Buy Indian Mutual Funds/ETFs with Global Equities
All things considered, investing in international stocks isn’t easy. Chances are, you won’t be familiar with the economy of the country you’re planning to invest in and neither will you know which company is, or will, perform better. Hence, it is best to let the experts do it for us. This is why investing through Indian mutual funds and Exchange-Traded Funds (ETFs) with global equities makes sense.
It is, by far, the easiest way to invest in foreign stocks. You won’t need to open any overseas trading account and neither is there a need to invest a hefty amount. Compared to direct investing in foreign stocks, where you might be asked to maintain a minimum of $10,000 deposit, investing in mutual funds/ETFs are cheap. ICICI Pru US Bluechip Equity and Kotak US Equity Fund are funds you can invest in.
4. Invest in Foreign Stocks Through Apps by Startups
Many new and established startups identified Indian investors’ lack of exposure to foreign stocks. To bridge that gap, they’ve come up with innovative apps that allow you to trade in overseas stocks in a single click. GROWW, Vested Finance, and Webull are some of the prominent apps Indians can use to invest in international stocks.
Vested Finance is easily the best of the lot. It is a US Securities and Exchange Commission (SEC) registered investment advisor, while investments made through it are secured by the US government itself. So even if the startup goes down someday, your money will be safe.