Stock market is one of the best investment opportunity available in the world. There are mainly three things that have power to make you rich i.e. starting your own business, investing in stock market, and investing in real estate. Here, we will talk about 2 ways to invest in US stocks from India.
Topics Discussed in This Article:
- How Big is US Stock Market?
- Benefits of Investing in US Stock Market
- 2 Ways to Invest in US Stock Market From India 2022
- How to Make Payment When Investing in US Stock Market
- Key Difference Between Indian Stock Market and US Stock Market
- Why US Citizens Prefer Investment in Stock Market Than Any Other Investments
Investment in US stocks can be highly profitable for the investors. World famous investor ” Warren Buffet ” is also from USA and has become one of the richest person of the word just by investing is US stock market.
US stock market is is considered as one of the powerful financial institution of the world. So, in this article, I have discussed about how big is US stock market, benefits of investing in US stock market, 2 ways to invest in US stock market, and how to make payment when investing in US stock market. So, let’s get started.
How Big Is US Stock Market?
The US stock market is the largest equity market in the world. The two largest US stock exchanges, the New York Stock Exchange and Nasdaq, have the shares of the world’s largest companies listed such as Amazon, Tesla, Microsoft, Google, etc.
Various indices related to the US market such as the S&P 500 Index, the Dow Jones Industrial Average and the Nasdaq Composite Index are used to understand the US and the world economy from an investor’s point of view. Along with this, their direction also has a big impact on other markets of the world. Companies from other countries also get their listing done in the US market for various reasons.
Benefit of Investing in US Stock Market
- Easy availability of figures and transparency of accounting methods.
- Strict rules over publication of facts and figures by corporations in the world
- Companies have to publish reliable information and historically relevant data every 3 months to public to help for best investment decision.
- USA has the largest free market economy in the world.
- World’s biggest companies are listed in US stock market.
- Leading technological developments are produced by US companies.
2 Ways to Invest in US Stock Market From India 2022
1. The first way is by direct investment. The investor can buy and sell stocks of any company by registering with the broker just like what they do in India. Nowadays Indian brokerage companies also tie up with American brokerage houses for the purpose of providing easy investment facility to the Indian investors. Investors can also register for trading in the market directly with a US brokerage company with the necessary PAN card and ID verifying home address.
2. Another way can be investing through mutual funds. Many mutual funds in India run US market based funds. They invest such funds either directly in stocks listed in US stock exchange or other mutual funds associated with such markets. There is no need of any separate registration and deep market understanding.
How to Make Payment When Investing in US Stock Market?
For investment in the US market, Indian currency has to be converted into US dollars. Due to foreign exchange related activity, it is necessary to follow the rules of Liberalized Remittance Scheme (LRS) of RBI. Under the rules, a person can invest up to $ 2,50,000 or about Rs 18 million in a financial year outside the Indian border without special permission.
The Government of India levies tax on the money made from investment in any market. As per the rules, short or long term capital gains tax can be levied depending on the tenure. However, the tax on dividend is levied by the US Government.
Key Difference Between Indian Stock Market and US Stock Market
-The Indian stock market is a much more volatile market than the US stock market. The Indian stock market is also less liquid.
-India has the highest number of listed companies in the world. The Indian Stock Market is also known as being one of the best places to invest in emerging markets.
-The US stock market has a higher capitalization and liquidity than India’s, which means that investors have more options when it comes to investing their money.
-The Indian stock market is more regulated than the US stock market. The Indian government has more control over the exchanges.
-US investors have less restrictions on how much they can invest and when they can invest.
-US investors are subject to taxes on their capital gains, whereas Indian investors are not.
Why US Citizens Prefer Investment in Stock Market Than Any Other Investments
Investing in stocks is a popular choice for many Americans. The stock market is often seen as a good way to grow your money, and it can be an easier option than investing in other assets like real estate or gold.
The reasons for this preference are as follows:
-It is easy to understand, which makes it more accessible for people who don’t have the time or knowledge to learn about other forms of investment like real estate or bonds.
-It has a higher potential return than any other form of investment and it also offers more liquidity, which means that you can sell your shares whenever you want without incurring heavy penalties.
-It is less risky than other forms of investments because if the company goes bankrupt, the investor still gets their money back.
-It does not require much work on behalf of the investor because there are many financial firms that invest in stocks on behalf of clients and they provide them with regular reports about their performance.
So, this is all about todays article. In this article I have main purpose of providing 2 ways to invest in US stock market from India in 2022. I hope the information that I have share in the article will be helpful for you. Please do not forget to give your valuable suggestion or feedback in the comment section below. Thank You !
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