Investing in the US stock market can be an attractive option for Indian investors looking to diversify their portfolios and gain exposure to global markets. However, for many the process can be confusing. In this article, we will inform you how to invest in US stocks from India and the things they need to consider before doing so.
How to Invest in US Stocks from India? Full Guide
In India, we have two stock exchanges that are Bombay Stock Exchange and National Stock Exchange. Similarly, the US also has two stock exchanges which are New York Stock Exchange and NASDAQ.
Now earlier you just had an asset class division that you could choose and benefit from, however, today you can enter newer markets and invest in newer stocks and asset classes to make profits from them.
Coming back to the question of how to invest in US stocks from India. You can as an investor go ahead and invest in US stocks via mutual funds, ETFs, direct equities, etc. There are two ways to go about investing in US stocks and they are direct and indirect. To understand either route, continue reading ahead.
Direct Investment Route
Under the direct investment route, there are only two options available to you and they are as follows.
1. Global Trading Account with Domestic Agent
A lot of domestic brokers also work as an intermediary for your trades by collaborating with US stockbrokers. So via one of these brokers you can, you can go ahead and open an International trading account.
All you have to do is submit all the documents you are asked for and you will get an account if the process goes smoothly. However, there are chances that the number of trades you can execute or the kinds of investments you can utilize might be restricted.
2. Opening an Overseas Trading Account with a Foreign Broker
The other option you have is to set up a trading account for international markets with an international broker that has a presence in India. Check the costs and terms and conditions of such brokers before you proceed.
Once you have selected the best broker go ahead and start buying US stocks from India. However, you should know beforehand that signing up for a direct investment route might be costlier since there are brokerages and exchange rates to be taken into consideration.
Indirect Investment Route
There are quite a few ways by which you can invest in US stocks when you choose to do so using the indirect investment route. Here your options include,
1. Mutual Funds
There are international mutual funds programs that you can be a part of. This overseas investment option can be a way for you to invest in US stocks.
2. ETF
ETFs or exchange-traded funds are units that are traded on the stock exchange during the trading hour. And so buying or selling an ETF can be done just as you would do with a stock.
You need to have a Demat account with a brokerage house to be eligible to trade in ETFs. Many ETFs get you access to NASDAQ and other important international indices.
You can use an Indian or international broker and an Indian ETF of a worldwide index, this should get you access to US ETFs.
3. Investment Apps
Today there are tons of apps for any and everything. You have various start-ups coming up with various apps that allow you to invest in US stocks as an Indian investor.
There might be regulatory restrictions and other stuff that might stop you from executing intraday deals or other things, however, there is a range of such apps and so you need to look for and choose the best one among them.
While earlier the answer to how to invest in US stocks from India would end here, recently, a third option has emerged which allows you to invest in US stocks through NSE.
4. NSE IFSC
Barely 7 years old, NSE International Financial Service Centre located in Gujarat’s Gujarat International Finance Tech City made it possible for Indian retail investors to invest in US stocks starting from 3rd March 2022.
So far there are only 8 stocks available for Indians to invest in but the number is expected to rise to 50 gradually. Trading in this market takes place from 14:30 to 20:00 IST which matches the time of the NYSE.
Your domestic Demat account won’t work here and so you need to open a special trading and Demat account with an IFSC-registered broker. The funds will be transferred from your Indian bank account to the broker’s IFSC registered account. Currency conversion comes into the picture here as the deals take place in dollars and not rupees.
Also Read: How to Buy Apple Shares in India? Full Guide
US Stocks To Buy
So far NSE IFSC has 8 US stocks for Indians to invest in as mentioned above and this number will increase to 50 in the future. As of now the US stocks to buy for Indians are,
1. Microsoft
Microsoft and the other companies on this list are in no need of any introduction. Founded by Bill Gates this tech company has enjoyed immense success over the years and so it makes sense for it to be one of the US stocks available to invest in for Indian retailers.
The stock is currently placed well between 280 and 300 dollars. In the last trading session, the stock saw a downward movement but it remains close to its 52-week high price.
Apart from being profitable from last year to date, the stock has been profitable in the short as well as long run. It is a very bullish stock and has a positive TTM EPS on a Y-o-Y basis and an average PE and so Indian investors shall look to invest in this stock.
2. Netflix
The streaming giant has got to be one of the top picks for Indian retailers when it comes to US stocks. The stock is currently priced at more than double its 52-week low price.
The stock lost some value in the last trading session but its average PE is a good indicator for the future. The stock is very bullish. In just 6 months the stock has provided the holders with almost 50% profit.
The company revenues have somewhat been stable while the total assets and equities have increased. The debt-to-equity ratio is also stable and can be said to be on a decline which is another good thing about this stock.
3. Apple
With the kind of reputation that this tech company enjoys in India, it won’t be hard to make a case to convince people to go for this stock.
Comparatively the least-priced stock on this list so far Apple stock is well placed between 160 and 170 dollars and is close to its all-time high price. The stock saw a downward movement in the last trading session but that doesn’t stop it from being very bullish at the moment.
In the last 5 years, this stock has given almost 300% profits to the shareholders. The stock PE is average which is another good indicator of things to come.
And since this article has told you how to invest in US stocks from India you shall not waste any time in checking out this stock and maybe even investing in it because with Apple you can always be certain of a profit coming your way shortly.
4. Amazon
Priced at just above 100 dollars per stock, Amazon stocks might be a bargain for Indian retailers. This e-commerce company is number 1 in the world and so there is little doubt about the potential that its stock carries.
If you could just send half of the money on the stocks of this company that you send on their platform then you might seriously benefit from it in the long run.
Though the share value fell in the last trading session the stock is far from its 52-week high price and so there is scope for a lot of gains. The stock has been said to be very bullish as of now which is a positive indication of future gains.
People who invested in this stock in the past week, month, or even three months saw their portfolios grow.
5. Walmart
Values almost at 150 dollars per stock, Walmart is one of the biggest brands in the US and also has a global presence. So far on this list, this is the only stock to have gained some value in the last trading session.
To add to that the stock is also said to be very bullish at the moment and so investors can expect to see profits in their portfolio if they choose to invest in this stock.
This stock has been delivering profits for the past 5 years which should tell you why it is a good stock to invest in. The PE of this stock is also average which is another good indicator of why you should consider investing in this stock. Also, this stock is closing in on its 52-week high price.
Also Read: How to Buy Google Shares in India? Full Guide
6. Alphabet (Google)
Priced above 100 dollars per stock this stock by Google has got to be on your mind when you consider investing in US stocks as an Indian retail investor.
The share lost some value in the last trading session but that should not paint the wrong picture. The stock has a low PE and a bullish rating to indicate that gains are just around the corner.
In the past 5 years, this stock has given more than 100% of profits to the investors, and also the current price of the stock is closer to its 52-week low price than its 52-week high and that suggests that there is more room for the stock value to rise. Even if we ignore all that Google is not a company that you should just look past.
7. Meta (Facebook)
Priced just above 210 dollars this stock is not the one that you should miss out on. The stock may have seen its value go down a bit in the last trading session but that should not be the only thing you consider about it.
The stock is said to be very bullish and the investors of this stock have been seeing profits for quite some time now.
The stock has an average PE and the year-to-date profit that the share has given to the shareholders is 75.74%. The share is closing in on its 52-week high price.
The company’s revenue has grown along with its total asset holding and the equity has been somewhat stable and so the company might be profitable anytime now for investors.
8. Tesla
Tesla is currently leading the EV revolution in the US and it has a very dynamic leader as its head which is why this company is always a good investment option.
It is priced in the mid 180 dollars and saw a fall in value in the last trading session and is also the only stock on this list to be rated as bearish as of now, however, it still is a good company to co sides investing in.
The stock is more than halfway down from its 52-week high price and so there is some scope there. The stock has low PE and boasts a TTM EPS that is up by 80.09% on a Y-o-Y basis.
This stock has given investors more than 730% in profits in the past 5 years and so that should tell you why you need to keep an eye on this stock.
US Stock Brokers in India
So now that we know that you can invest in US stocks from India and the stocks that you can invest in it is time to look at some of the US stock brokers in India that allow you to do so.
1. TD Ameritrade
You need a minimum deposit of 0 dollars to open an account with this broker. This broker allows you to deposit money via bank transfer and withdraw via bank transfer.
The withdrawal fee charged to the user is 0 dollars and the account can be opened in 1 to 3 days. It is a great trade platform with excellent customer support selection and selection of mutual funds.
The platform also has zero-dollar stock commissions, zero-dollar ETF commissions, and zero-dollar account minimum.
2. Fidelity
If you are an everyday investor then this platform might be the correct one for you. However, new investors can also use this platform. The user interface offered by this platform is great and they provide various tools and resources to help investors.
You can open an account in 1 to 3 days on this platform. It is a very affordable option. The company does extensive and comprehensive stock research and provides data about the same to you. They also offer vast educational resources.
3. Charles Schwab
This is one of the best brokerage and trading platforms around and is good enough for casual as well as expert investors. Here you get access not only to educational tools but also to calculators and research.
You can open an account in just 1 day on this platform. Here you can trade not just in stocks but also in ETFs for free. They also offer great customer support, robo-advisory services, and much more features and facilities to their users.
Also Read: How to Invest in Amazon Shares from India? Full Guide
4. Interactive Brokers
If you are a professional or seasoned investor then this is the platform you should be on. Now that we know how to invest in US stocks from India you might want to choose to use this platform also because this platform gives you the option of investing in assets like futures, stocks, options, forex, funds, and bonds.
You have to make 0-dollar investments and are charged 0 dollars for withdrawals. The margin rates on this platform are low and commission rates are also zero to low.
5. E*Trade
This happens to be one of the first trading platforms in the US. It is a platform where from novices to an expert everyone can be. They have an extensive collection of educational resources.
The platform charges zero comparison fees, asks for zero minimum deposit, and provides customer support including through branch offices among other things.
And so with that, we have not just answered the question of how to invest in US stocks from India but have also mentioned all the US stocks to buy and some of the US stock brokers in India who can help you do so. So quit waiting and start investing in US markets already.
