If you’re among the 11 crore Indians investing in the Indian stock market, you’ve taken the first step towards long-term wealth creation. The Indian economy is growing at 8.7%, and investing in it through the stock market is a way to ensure your wealth grows with the economy.
But like all good wealth management handbooks go, diversification needs to be factored in. For instance, investing in another market altogether allows you to continue growing a part of your wealth even if one market isn’t doing particularly well temporarily.
The US economy may not be growing as fast as India’s, but it is home to some of the largest tech and pharma companies in the world.
With companies like Amazon, Apple, Meta (Facebook) and others, the US stock market presents a one-of-a-kind investment opportunity. Investing in the US stock market also assures you of more stable wealth creation, given that the top US stocks have a very high market capitalisation. This means, the total pool of invested money in these stocks is to the tune of trillions of dollars, making them relatively safer to invest in.
Ways to Invest in US Stocks from India
Via Direct Investments
- Overseas Trading Account with a Domestic Broker- To start investing in the US stock market from India, you can open an overseas trading account with a domestic brokerage firm that has tie-ups with US brokers.
In this method, your domestic broker will act as an intermediary, facilitating and executing your trades. However, depending on the broker, you might have to weather trade caps and restrictions on investment vehicles.
- Overseas Trading Account with an International Broker -This route allows you to tap into the US stock market without intermediaries.
You can opt for foreign brokers like Ameritrade, Charles Schwab and others that have an Indian presence to start directly investing in the US stock market.
- NSE IFSC - You can also trade US stocks through the NSE IFSC, a wholly-owned subsidiary of the National Stock Exchange (NSE). You will need a new demat account with an IFSCA-licensed broker to start investing.
It’s important to know that investors can only invest in 25 US stock options, including Amazon, Apple, Microsoft, Walmart and others. However, the total number is set to go up to 50 in the near future.
Via Indirect Investments
- Mutual Funds - This lets you forego the costs of an overseas trading account. This investment route allows you to diversify your investment across a range of asset classes and industries.
However, currently, the MF route remains partially restricted. As per RBI directives, investment through this route is paused as international mutual fund investments have already met the 7 billion industry cap.
- ETFs -There are two ways of investing through ETFs or Exchange Traded Funds. The first entails purchasing US ETFs via a domestic or foreign broker. The second is the indirect route, where you can purchase Indian ETFs of US indices.
The lower expense ratio of ETFs makes them more favourable options than actively managed funds.
Investing Through Fi Money
Investing on the Fi app allows you to invest directly into US stocks. Fi Money partners with SEC-regulated American brokerage firms who buy and hold stocks on your behalf. Some advantages of investing in US stocks through Fi Money include:
- Real-time investing
- Zero brokerage or commissions
- Invest in fractional stocks with amounts as low as ₹100
- Paperless account creation
- Zero withdrawal charges
If you’re an existing Fi user, you should be able to start investing right away. If not, opening an account on Fi should take you all of 5 minutes, after which you should be ready to go!
Why Should I Invest in US Stocks From India?
Portfolio Diversification
Diversifying your portfolio helps weather market-linked fluctuations. By investing in US stocks from India, you essentially broaden your investment exposure. This allows you to mitigate economic risks associated with the crests and troughs in the Indian market.
Opportunity to Invest in Top Companies
Investing in the US stock market from India gives you access to several blue-chip companies like Amazon, Apple, Tesla and others. The sheer size, trade volume and investment options available in the US stock market present a unique investment opportunity.
Tapping into Innovation
As the nerve centre of innovation, the United States is home to thousands of promising enterprises. With segments like robotics, AI, ML and biomedicine flourishing, investing in US stocks helps you grow your wealth on the back of all the ground-breaking progress being made. You can tap into this growth potential of budding innovative ventures and reap the benefits of an early bird entry.
Potential Currency Gains
Currency exchange rates add to the gains you stand to derive from investing in the US stock market. The US dollar was at ₹63 in January 2018 and stood at ₹83 as of January 2023. That’s a 30% appreciation in 5 years. Investing in US stocks lets you gain from the sheer value of dollar growth as well.
Higher Returns with Less Volatility
While all markets go through ups and downs, the Indian stock market has recorded bigger swings than the US stock market. Other than the Russo-Ukrainian conflict of 2022, which shook most global markets, the relative stability and manageable cyclical changes in the US market make it a less volatile option for investors. This, coupled with the consistent appreciation of the Dollar, has ensured stable returns for investors.
Things to Consider Before Investing in the US Stock Market
If you’re thinking about starting your investment journey in the US stock market, here’s a list of things you should keep in mind:
Taxation
Your profits from investments in the US stock market are covered under the DTAA or Double Tax Avoidance Agreement. As per the agreement, the same income cannot be taxed twice. Dividend income from US stock investments is taxed at 25% for Indians and can be claimed as Foreign Tax Credit on domestic tax fillings (due to DTAA).
While capital gains are immune from taxation in the US, in India, there’s a 20% long-term capital gains tax levied for holdings of two years or more. Capital gains for a short-term holding (less than two years) are added to your annual income and taxed as per your income slab.
Investment Cap
Investments in the US stock market are regulated as per RBI’s Liberalised Remittance Scheme or LRS. The LRS mandates a yearly investment cap of $250,000 per investor. Your investments have to remain within this stated investment cap.
Ancillary Charges
Apart from taxes levied on your returns, there are other charges you’ll have to shoulder when investing in US stocks from India. From brokerage fees, FX conversion charges and transaction fees to annual maintenance fees, there are quite a few overheads to consider.
Unless you’re investing in US stocks through Fi Money, in which case you need to pay no extra brokerage or commissions.
Investment Goals
Your investment strategy should be centred around your investment goals. In other words, your approach should ideally reflect your life goals - whether you wish to relocate, fund your child’s education or simply build a corpus for your retirement. Once you’ve figured out your investment goals, you can pick an investment avenue - direct or indirect- that best suits this purpose.
Conclusion
Like most things that have gone remote after the pandemic, US stock investing can be done from India from the comfort of your home. It’s a lot like investing in Indian stocks except, you can also buy fractional shares. The top stocks in the US market have a market capitalisation that runs into trillions of dollars, making them substantially safer to invest in too! Companies listed in the US exchanges are also high on innovation ranging from tech to pharma and even infrastructure and defence. This lets you grow your wealth on the back of all the advancements being made in the global market.
Fi Money helps you to invest in top US companies — at industry-best forex rates. So you can own shares in Apple, Tesla, Microsoft, and so on! With an intuitive user interface, Fi simplifies the world of US Stocks. Besides in-app explainers, novice investors can use Curated Collections (like All-Time Favourites) to make decisions. Seasoned investors can dive deeper, apply many filters (like Stock Price) & pick from a wide range of international options. What's more, on Fi, you can buy US Stocks instantly with zero brokerage fees.
Still curious? Learn more about how to get started with investing in US Stocks through this short video: https://www.youtube.com/shorts/VywxVwa-9nM
Frequently Asked Questions
1. Can I invest in NASDAQ from India?
Yes. You can invest in NASDAQ from India via direct or indirect investment routes. As per the direct routes, you can open an overseas trading account with a domestic or international brokerage firm. Alternatively, you can also start investing via the indirect route through mutual funds and ETFs.
2. Should I invest in US Stocks for the short-term?
As such, stocks are not favourable short-term investment vehicles. Stocks tend to perform better in the long run, offering higher returns than most other investment tools. Thus, when it comes to US stocks, investing in them for the long run would be a better option.
3. How can I invest in US stocks from India?
There are plenty of ways. Apps like Fi Money are great places to begin. While they’re both fully digital, Fi Money allows you to invest at no additional cost, at real-time, and even lets you start with amounts as low as ₹100.
FAQs
You can invest in NASDAQ from India via direct or indirect investment routes. As per the direct routes, you can open an overseas trading account with a domestic or international brokerage firm. Alternatively, you can also start investing via the indirect route through mutual funds and ETFs.
Can I invest in US stocks from India? ›
The first option for Indian investors to invest in US stocks is by opening an overseas trading account with a domestic broker. Indian investors can open an overseas trading account with a domestic broker like HDFC Securities, ICICI Direct, or Kotak Securities.
Is investing in US stocks from India worth it? ›
Indians can take advantage of the US dollar's rising stature by investing in US stocks in India. As its value increases, your US stocks investments do well too. Plus, there's no cap on the amount you can invest, and the taxation policies are crystal clear. So, invest in diversifying your portfolio.
Can I invest in US stocks through Zerodha? ›
At present, Zerodha does not facilitate investments in stocks listed on foreign stock exchanges. Still need help?
Which app is best to invest in US stocks from India? ›
INDmoney makes it easy for anyone wanting to start investing in US stocks from India. Our zero-cost structure allows you to start trading without any account opening fees or commission on buying and selling. It takes less than 3 minutes to open a US stocks account with INDmoney.
How are US stocks taxed in India? ›
Indian investors are subject to a flat tax rate of 25% on earnings from dividends of US stocks, which is comparatively lower than the tax treatment for other foreign investors due to the US-India tax treaty.
Which broker is best for US stocks in India? ›
You can opt for foreign brokers like Ameritrade, Charles Schwab and others that have an Indian presence to start directly investing in the US stock market. NSE IFSC - You can also trade US stocks through the NSE IFSC, a wholly-owned subsidiary of the National Stock Exchange (NSE).
What are the disadvantages of investing in US stocks from India? ›
Taxability Risks
If the sector that you are invested in is at the receiving end of certain tax increases, then all companies can suffer and their stocks can tumble. Also, talking about tax, as an Indian investor, you need to keep the types of taxes in mind – capital gains tax and dividend tax.
Which US stock is best to buy now? ›
Best US Stocks
| Stock Name | Ticker | Market Cap |
|---|
| Microsoft Corporation | MSFT | 1.705 T |
| Amazon.com Inc. | AMZN | 1.089 T |
| Tesla, Inc. | TSLA | 642.330 B |
| Johnson & Johnson | JNJ | 432.395 B |
16 more rowsOverseas Assets –
You will not be liable to pay tax. As an NRI returning to India, you can also continue to hold your foreign earnings, foreign securities, and immovable property outside India if it was acquired when you were a resident outside India. The income from such investments can also be retained outside India.
You can directly open an overseas account with an international brokerage firm who have a presence in India. Some of the foreign brokers operating in India are Ameritrade, Charles Schwab. However, before buying stocks through these firms, you must understand the brokerage fees/structure and other costs.
How can I buy Tesla stock in India? ›
How can I purchase Tesla, Inc. shares in India?
- Directly: By opening an international trading account with Angel One. The process would include KYC verification. ...
- Indirectly: By investing in mutual funds and Exchange Traded Funds (ETF) that offers exposure in global stocks.
Yes, you can buy international (US) stocks on Groww. Log in to your Groww account. Below explore button, click on the US stocks button and start investing as per your choice of stocks.
Can I invest in US stocks from India using Robinhood? ›
You can invest in over 5,000 securities with Robinhood Financial, including most U.S. stocks and exchange-traded funds (ETFs) listed on U.S. exchanges. We're also excited to offer options trading and access to over 650 global stocks through American Depositary Receipts (ADRs).
Which is more profitable US stocks or Indian stocks? ›
With the US stock market, this is done in USD naturally. The USD is the global currency by default and is a stronger currency than the INR. Hence, any investments made with the USD in play will bear higher returns. This spells more profit for the investors who invest in US markets.
How do I withdraw money from IND money? ›
You cannot withdraw funds in your term deposit account anytime you want. Instead, your amount is locked for a particular period of time and you can only withdraw it after the end of your term. And in case you withdraw funds from your term deposit before its maturity, it can result in significant penalties.
Is money from India to USA taxable? ›
The money sent from India to the US is not taxable. However, you must declare it to the IRS by submitting Form 3520 if it exceeds US $100,000 for any given year. There are no taxes due on this form; it is merely informational. However, gift taxes in the US can be imposed if the funds are given as a gift.
Is Indian income taxable in USA? ›
Any income from dividends in India is tax-free. However, in the US, dividends are added to the total income and taxed. How to report for taxes: NRIs need to report “Interest and dividends “income in Schedule B of Form 1040. Form 1116 can be used for foreign tax credits.
How much tax do I pay on US shares? ›
Long-term capital gains tax rates are 0%, 15% or 20% depending on your taxable income and filing status. Long-term capital gains tax rates are usually lower than those on short-term capital gains. That can mean paying lower taxes on stock sales.
Which broker is No 1 in India? ›
Zerodha is the top most stock broker among all the brokers in India since 2019. Zerodha is followed by Upstox, Angel One, ICICIdirect and Groww. No records found.
What is the difference between the Indian stock market and the US stock market in terms of market size? The Us stock market commands a market capitalisation of $40.51 Trillion. The Indian stock market has a market cap of $3.4 Trillion. So, the US market is more than 10 times bigger than its Indian counterpart.
How can I invest in US stocks from India through NSE? ›
Since NSE IFSC trades are conducted in US dollars and not Indian rupees, currency conversion is mandatory to make investments in NSE IFSC US stocks. You can start trading in US stocks listed on the exchange once your funds have been transferred to the account of the IFSC-registered broker.
What is the maximum limit to invest in US stocks from India? ›
According to the mandate given by the Reserve Bank of India, all Indian mutual funds registered with the Securities and Exchange Board of India (SEBI) are permitted to invest in international markets up to a limit of $7 billion, and investments in international ETFs have a limit of $1 billion.
What is the best time to buy US stocks? ›
The opening 9:30 a.m. to 10:30 a.m. Eastern Time (ET) period is often one of the best hours of the day for day trading, offering the biggest moves in the shortest amount of time. A lot of professional day traders stop trading around 11:30 a.m. because that is when volatility and volume tend to taper off.
How to invest in US stocks from ICICI Direct? ›
How to get started?
- Login to your ICICI Direct account. You need to be existing ICICI Direct Customer to get access to ICICI Direct Global.
- Subscribe to a plan of your choice. Choose the plan which works best for you.
- Upload your Scanned Documents. ...
- Get access to ICICI Direct Global Investment Platform.
The largest stocks greatly impact the index's long-term performance and daily movement. Apple, Microsoft, and Amazon are the top three stocks in the index. Other companies in the S&P 500's top 10 list include NVIDIA, Alphabet, Berkshire Hathaway, Meta (formerly Facebook), UnitedHealth, and Tesla.
What are the top 3 stock markets in the US? ›
The three most widely followed indexes in the U.S. are the S&P 500, Dow Jones Industrial Average, and Nasdaq Composite. The Wilshire 5000 includes all the stocks from the U.S. stock market.
What are the top 3 most active stocks today? ›
Most Actives
| Symbol | Name | Price (Intraday) |
|---|
| CVNA | Carvana Co. | 21.31 |
| INTC | Intel Corporation | 32.90 |
| XPEV | XPeng Inc. | 9.86 |
| AMZN | Amazon.com, Inc. | 126.45 |
21 more rowsHow much money can be transferred from India to the USA? The US authorities do not impose a limit on the amount of money you can send from India. However, you may need to report high value payments to the IRS using IRS Form 3520.
Can I keep my US bank account if I move to India? ›
Can I keep my US bank account after moving back to India? Yes. People moving back to India can keep their US Bank Accounts. They can also keep their Credit Cards open to add to their credit score.
In short, foreign investors do not have to pay capital gains taxes to the US government on sales of American stocks. Instead, they will have to pay capital gains taxes in their home country. Every country has its own capital gains laws, some of which are more favorable to investors than others.
Can I invest in Vanguard from India? ›
Can I buy S&P 500 Vanguard ETF (VOO) shares? Yes, Indian investors can buy S&P 500 Vanguard ETF (VOO) in the US stock market by opening an International Trading Account with Angel One.
Is there S&P 500 in India? ›
The S&P BSE 500 is designed to be a broad representation of the Indian market. Consisting of the top 500 constituents in the S&P BSE AllCap, the index covers all major industries in the Indian economy.
Is Vanguard S&P 500 a safe investment? ›
Vanguard S&P 500 ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, VOO is a great option for investors seeking exposure to the Style Box - Large Cap Blend segment of the market.
What is SpaceX stock price? ›
The price of SpaceX has risen by 3,878.50% in the past 7 days. The current price is $0.000681 per SPACEX. The new price represents a new all time high of $0.000681.
How much is 1 Tesla? ›
One tesla is equivalent to: 10,000 (or 104) G (gauss), used in the CGS system. Thus, 1 G = 10−4 T = 100 μT (microtesla). 1,000,000,000 (or 109) γ (gamma), used in geophysics.
Is it worth buying 1 share of Tesla? ›
The difference is that Tesla isn't like most companies, so at its current price, buying one share of Tesla stock may have more reward potential than risk. Yes, the company could lose value, in which case that single share would lead to a small loss.
How to buy US stocks internationally? ›
However, to buy individual stocks on a foreign market, you need to open an account with an international broker—one that supports the buying and selling of international stocks. It's wise to understand the fees, available countries, and assets before selecting your international broker.
Can I invest in US stocks from another country? ›
There is no citizenship requirement for owning stocks of American companies. While U.S. investment securities are regulated by U.S. law, there are no specific provisions that forbid individuals who are not citizens of the U.S. from participating in the U.S. stock market.
Is it worth investing in US stocks? ›
Diversification. Investing in the US markets helps you diversify your portfolio as the market offers extensive avenues to invest in top sectors of Technology, Finance, Automobile and Gold. Investing a part of your assets in such markets also makes you independent of the Indian stock markets and the Indian economy.
Be 18 years or older. Have a valid Social Security Number (not a Taxpayer Identification Number) Have a legal U.S. residential address within the 50 states or Puerto Rico (exceptions may apply for active U.S. military personnel stationed abroad) Be a U.S. citizen, U.S. permanent resident, or have a valid U.S. visa*
Why is Fidelity better than Robinhood? ›
Fidelity suits most types of traders since it offers several self-directed and automated account options. However, Robinhood is a better choice for low fees, and it makes more sense for active traders, day traders, options traders, and crypto traders. Is Fidelity or Robinhood better for beginners?
How to invest in Nifty 50 from USA? ›
To have access to the Indian stock market from the US, you will have to either open an account with an international brokerage firm regulated by the U.S. Securities and Exchange Commission (SEC) or open an account with a SEBI-registered Indian stockbroker.
Is it risky to invest in US stocks from India? ›
Can Indians invest in the US stock market? Yes, Indians can invest in the US stock market. There is more than one way to buy and hold US stocks in your portfolio. Direct equities, ETFs, and mutual funds are just one of the few popular options.
How much tax do we pay in US stocks from India? ›
Indian investors are subject to a flat tax rate of 25% on earnings from dividends of US stocks, which is comparatively lower than the tax treatment for other foreign investors due to the US-India tax treaty.
Is it good to buy US stocks from India? ›
Indians can take advantage of the US dollar's rising stature by investing in US stocks in India. As its value increases, your US stocks investments do well too. Plus, there's no cap on the amount you can invest, and the taxation policies are crystal clear. So, invest in diversifying your portfolio.
Can I buy US stocks from Zerodha? ›
At present, Zerodha does not facilitate investments in stocks listed on foreign stock exchanges. Still need help?
How can NRI invest in US stock market? ›
You can invest in the US stock market directly by opening an overseas trading account with a domestic or foreign broker. Be mindful of the charges before you pick the best app to invest in US stocks.
Is it safe to invest in INDmoney? ›
Yes, the INDmoney app is secure as first of all it's a SEBI-registered financial advisory company. Secondly, INDmoney undergoes a thorough security audit by Bishop Fox, a renowned company that provides safe platforms.
Can I invest in S&P 500 from India? ›
Yes – investors from India can invest in the US stock market. If they are interested in diversifying beyond Indian stocks and financial instruments, beyond the Sensex or the Nifty 50, Indian investors can do so by investing in the S&P 500, Dow Jones, Nasdaq or other US listed companies.
The S&P BSE 500 is designed to be a broad representation of the Indian market. Consisting of the top 500 constituents in the S&P BSE AllCap, the index covers all major industries in the Indian economy.
Can I invest in S&P 500 from Groww? ›
You can easily invest in Motilal Oswal S&P 500 Index Fund Direct Growth in a hassle-free manner on Groww. The process is extremely simple, quick and completely paperless.
Is it better to invest in US or India? ›
Volatility. When compared to Indian markets, the US markets have been less volatile in the long run. Indian equities have shown great volatility, with bigger swings in returns over the years. This is another reason experts recommend diversification when it comes to investing, since risks are spread out and diminished.
How to invest in Nasdaq 100 from India? ›
They are as follows:
- EFTs and Mutual Funds Listed in India - You can start by investing in EFTs and mutual funds listed in India if you're interested in the large NASDAQ market. ...
- Direct Investment in the US Stocks - With the help of a broker, you can open a trading account and directly invest in the US EFTs and stocks.
Does Robinhood work Internationally? No, Robinhood doesn't work internationally. To use Robinhood, you must be a US citizen, a permanent resident, and have a valid US visa. You can find Robinhood alternatives for international users here.
