Tar's Portfolio and Information Attic

Unless your ticket size per investment in US direct stocks is > 1 lakh, direct investing would not make sense as

  1. There are a lot of charges in deposit, withdraw, and transfers from INR to these Brokerage Accounts. Further the transaction fees on these is not free or the ones we are used to by Zerodha and like. So you will end up paying a lot in fees and other costs if you invest which causes your required return on your investment to up by a few percentage points.

  2. US markets is more sophisticated. It’s not like our markets where an investor is protected to some extent via lower and upper circuit filters. US markets doesn’t have training wheels like that. If a stock falls it is allowed to fall and go to 0 (theoretically) at any day.

  3. Taxation becomes an issue by investing directly in US stocks. Your dividends are taxed at 25% and you then have to use the tax credits to claim tax return in India. You also don’t get any indexation benefits and filing of income tax return becomes a lot more complicated.

99% of investors are better off investing in US markets via an ETF provided by an Indian investment house. You skip all of the above issues doing that while still getting exposure to the US market. There are several Nasdaq, S&P and DJI based ETF and funds available to select from on any mutual fund app.

If you however still want to invest directly, you can check out Interactive Brokers, Groww has an offering and stockal GlobalInvesting is another platform you can use.

I don’t recommend anyone to direct invest unless they have done deep research and want exposure to one or two stocks while maintaining a ticket size of > 5 lakhs.

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