It is a known fact that diversifying your portfolio helps minimize risk when investing in stocks. While many diversify their portfolios by investing in different sectors and across the range of market capitalizations, global investing is another option for building and diversifying your stock portfolio.
Refresh your portfolio with international investments
As a country with a booming economy, India plays a crucial role in the growth of many international MNCs, including Amazon, Google, Facebook and Apple. As these companies grow in India, and globally, they are generating substantial returns for their investors. However, for Indian investors, access to the global markets has traditionally been an expensive affair with limited options.
Taking investment across borders involves a set of regulations and guidelines issued by the Reserve Bank of India (RBI) under the Liberalised Remittance Scheme (LRS). In addition, one should also be acquainted with the taxation laws of the foreign country where one is investing. In India, the United States of America (USA) is the most preferred international investment destination; as of January 2021, the US stock market accounted for 55.9% of the world equity market value and is home to a number of the largest and most popular global companies, such as the FAANG stocks (Facebook, Apple, Amazon, Netflix and Google).
There is an assumption that investing in US stocks from India is a cumbersome process and can be expensive. However, associating with Globalise, a platform devoted to providing its clients with end-to-end global investing services, makes the process simple and secure, while reducing costs and friction along the journey. With no minimum investment amount, one can build a diverse portfolio with utmost ease.
Why invest in the US stock market from India?
As per reports, the NASDAQ 100 fund yielded 52% over the last year, resulting in the valuation of US stocks skyrocketing. Now, it has become one of the most favored funds among Indian investors. Furthermore, expert strategists forecast a recovery growth in earnings-per-share across all regions in the coming year. S&P 500 is expected to experience a 27% growth in 2021. As per a survey conducted nationally, 35% of the Indian consumer population chose to increase investments in the stock market, on par with public equity, for the coming three years. Thus, investing in the global stock market can have several benefits, particularly for Indian investors. With the right knowledge and patience, one can build a robust portfolio that can potentially yield superior returns while reducing overall risk. Here are a few of the reasons to invest in the global share market, especially in US stocks:
- As a hub for innovation, the US is home to many companies that are leading the next generation of technology, such as cloud computing, artificial intelligence, and biotech. By investing in the US market, you can invest in these companies and participate in their growth.
- Many leading global companies such as Microsoft, Apple, Toyota, and Alibaba are listed on the US stock market, offering a more diverse investment avenue.
- The US stock market has demonstrated more stability as compared to the Indian stock market – over the past years, and particularly during since the Covid pandemic began, the volatility in the US stock market has been lower as compared to the Indian market.
- Save in US dollars! With your money growing in the US market, you can accumulate cash in dollars which makes it easier for you to spend when studying or traveling in the US.
How to invest in US stocks from India?
Given the numerous reasons for investing in the US stock market, the natural question is: How to buy US stocks from India? Before starting your investment journey, it is important to identify your goals and finances. Another basic requirement is to have access to a US brokerage account that is fully compliant with laws in India as well as the US. With a focus on providing a guided international investing experience, Globalise helps investors simplify their investment journey. We also provide access to an SEC-regulated US brokerage account for direct access to the NASDAQ and NYSE stock exchanges via paperless onboarding. Once a Globalise customer, you can trade in US stocks from India, and access various features such as:
- Over 4,000 stocks, ETFs, and ADRs to choose from.
- Access to curated portfolios for investing in US stocks.
- Real-time curated news and information on all US market stocks
- Fractional investing, which enables investors to build a flexible and diverse portfolio.
With a few simple steps, investors can set up their account, and start investing in an array of instruments available on the NASDAQ and NYSE from the comfort of their homes.
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