World Stocks
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.
Investing in US stocks or ETFs by Indian investors is permissible under the RBI’s Liberalised Remittance Scheme (LRS), by using purpose code S0001 (fun fact: you can also open US bank accounts under this purpose code).
Investing in the US can be an easy way to invest in other international markets. For example, you can easily invest in the Chinese economy through investing in the US market. The fast-growing Chinese economy – driven by a growing middle class and rapid technology adoption – has led to the creation of some of the world’s leading technology companies. However, instead of going public in China, more and more of these Chinese technology companies are choosing to list in the US. Furthermore, there are ADRs (American Depositary Shares) of Chinese companies that enable USD-based buying and selling, where the underlying shares are held by multinational Banks or Brokers.
For Indian investors, another benefit of investing through the US stock market is that the ecosystem is very well regulated, with strict controls on financial reporting, transparency, and standardised governance practices, making it easier for the investors to evaluate the different opportunities.
For more information, please contact us.