There are two different methods of investing in US Stocks from India. These are:
- Direct Investment in US Stock
- Indirect investment in US Stock through mutual funds or ETFs
Let us understand these two methods in detail.
Direct Investment in US Stock
Investors can directly open overseas trading accounts with domestic or Foreign brokers. Let us know how to open an overseas account with the domestic or Foreign Broker.
Opening The US or Overseas Trading Account With a Domestic Broker?
Many domestic stockbrokers such as HDFC Securities, Motilal Oswal, Geojit, and fintech platforms like Stockal provide US investing facilities to their clients. They play the role of intermediaries and execute a trade for their clients. You can open your overseas trading account with such brokers. You might have to submit essential documents to open the trading account.
However, it should be noted that this facility has some restrictions. Based on the brokerage firm, you might have some restrictions on certain numbers of trades you can make at a time or restriction of investment in certain companies. The cost of investing in US stock can be high, considering the brokerage and currency conversion charge. Hence, it is important to know about such costs before opening an account.
Opening The US or Overseas Trading Account With a Foreign Broker
You can also open your US or an overseas trading account with the foreign brokers whose presence is in India. Such brokers are Ameritrade, Interactive Brokers, Sasko Bank, Tastyworld, etc. Make sure to understand the brokerage fees and charges before opening your trading account.
Indirect Investment In US Stock
Similar to domestic investment, you can have an indirect investment in US stock without investing them directly through two different options i.e Mutual funds and Exchange-traded funds. Let us understand these terms in brief.
Investing in stocks listed on an exchange outside India can be easily done through mutual funds. You are not supposed to open an overseas trading account or maintain a minimum deposit that is mandatory to maintain with some stockbrokers offering the direct international investment.
There are numerous mutual funds that invest in US stocks. Some of the mutual funds that invest in US stocks are Nippon India US Equity Opportunities Fund, ICICI Prudential US Bluechip Equity Fund, DSP US Flexible Equity Fund, Aditya Birla Sun Life International Equity Fund, etc. You can invest in such funds if you want to save your precious time and money, and also helps you to choose the right stock for investing. Make sure to understand the expense ratio of the mutual fund scheme in which you are investing before buying.
You can enjoy exposure to US stock by investing in Exchange-traded funds. These are direct or indirect modes available for ETFs. You can buy US ETFs directly through domestic or foreign brokers or buying domestic ETFs of international indices.
Investing Through Latest Mobile Apps
There are different mobile apps that are launched by startups that help Indian investors to easily invest in the US- stock market.
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