Can Indian Citizens Buy Shares Of Companies Listed In Foreign Stock Exchanges?

Discussion in 'Stock Market Forum' started by Advisorymandi, Nov 21, 2018.

  1. Advisorymandi

    Advisorymandi Member

    Mar 2018
    Likes Received:
    Of course! Indian citizens can invest in foreign stocks and buy shares of companies listed in foreign stock exchanges. You can invest in foreign companies like Apple, Facebook, Wal-Mart, Google, and Microsoft under the Reserve bank of India (RBI) liberalized remittances scheme (LRS) of up to US $250,000 per financial year.

    However this limit is for those investors who choose to direct investments in foreign funds. Besides, if you are planning to invest in foreign funds, then you gotta pay the brokerage charges in the currency other than the country you reside in. On top of that the profits also increase and decrease in value as per the currency exchange rates.

    Even then there is a very complex method or process to do direct investments in the foreign stocks and buy shares of companies listed in foreign stock exchange.

    Method 1: To Invest Direct in Foreign Funds
    In order to invest directly in foreign funds, you need to open a trading account with your broker especially the one who has ties with the foreign brokers and can provide overseas trading facility. After that you gotta submit your separate account opening form along with your KYC. Once you done with this, you gonna need to transfer the money to the international partner of your broker through which international services are provided to you.

    Now to transfer the funds to the international partner can be proceed in this way:

    · Submit your application cum declaration form under LRS.

    · Fill form A2.

    · Once you finished submitting then you can sign a form for FEMA (Foreign Exchange Management Act) declaration.

    After the successful transferring of funds, you can easily buy and sell foreign stocks through the online platform.

    Method 2: Buy Global Mutual Funds or Exchange Traded Funds (ETFs)
    This is the alternative method to invest in the foreign stocks. If you are not interested in investing in foreign stocks directly then you can simply go for global mutual funds or ETFs. Good thing is, there is no limit of investing in global mutual funds like in direct foreign stock investments. Besides, you won’t need to open an overseas account to invest.

    You can simply buy the funds that trade globally.

    You can invest in foreign stocks either way. Decide, whichever suits your investment goals.

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