How to invest in US stocks from India

Investing in the US stock market from India offers a fantastic chance to broaden your financial horizons. By adding US stocks to your portfolio, you get exposure to top global companies like Nvidia, Amazon, Microsoft and more, many of which lead in fields like technology, healthcare, and consumer goods. 

Diversification brings added stability, as your investments span beyond local markets. Holding assets in USD can provide currency-related benefits if the rupee depreciates. Whether you are aiming for high-growth tech stocks or looking to invest in solid blue-chip companies, getting started is simpler than it might initially appear. 

Let's dive into the different methods of how to invest in US stocks from India. However, before this, let’s understand why one must consider US stocks.

Why consider US stocks?

For Indian investors, US stocks offer exciting benefits. First, they provide an opportunity to diversify internationally, spreading risk across a different market—particularly a robust one like the US. 

This exposure includes access to globally influential companies and innovative sectors, boosting your portfolio with high-quality names. Plus, investing in US stocks means your holdings are valued in dollars, allowing for potential currency gains if the USD strengthens against the INR.

How to buy US stocks from India?

Open a trading account with a foreign broker

One of the easiest ways is to open an account directly with a US-based brokerage firm that caters to Indian investors. Here’s how:

Choose a brokerage platform

• Research and select a reputable US brokerage that accepts clients from India.

Open an account

• You will need identification documents like a passport, PAN, and bank details for verification.
• Fund your account
• Transfer funds using the Liberalised Remittance Scheme (LRS), which lets Indian residents remit up to $250,000 annually for investments abroad.

Start investing

• Once your account is funded, you can buy stocks directly from the US stock market through the broker’s platform.

Invest via Indian brokerages 

• Some Indian brokers and trading platforms offer a seamless way for Indian investors to invest in US stocks from India. Steps include:

Open a three-in-one account

• These accounts link your savings, trading, and demat accounts, simplifying international transactions. 

Buy fractional shares

• For high-priced stocks, some brokers offer fractional shares, so you can invest smaller amounts.

Review fees

• Check the fees and commissions involved, as these may differ significantly across brokers for international trade.

Invest in ETFs or mutual funds

• For those who prefer a hands-off approach, US-focused Exchange-Traded Funds (ETFs) or mutual funds offer exposure to the US stock market without requiring individual stock selection.

US-focused ETFs

• Indian mutual fund companies often offer ETFs tracking US indices like the S&P 500, which helps diversify across the US market.

Mutual funds

• International mutual funds focused on the US are another option.

Key considerations before investing

• Exchange rate risk
• Your returns can fluctuate with changes in the INR-USD exchange rate.
• Platform fees
• Compare fees and charges between brokerage platforms to avoid high fees that can eat into returns.
• Do your research
• Just like with investing locally, a sound understanding of the US stock market is essential before making investment decisions.

Ending note

Investing in US stocks from India is not just about reaching global markets—it is about securing your financial future with a diverse and resilient portfolio. By accessing top-tier companies in the US market, you open doors to industries and opportunities that can withstand local fluctuations and even benefit from currency shifts. 

Whether you choose direct brokerage accounts, Indian brokers with US ties, or diversified options like ETFs, each path offers unique benefits. With informed choices and careful planning, you can enjoy the growth potential and stability of the US market, building a truly global portfolio from the comfort of your home.