Apple, Google, Tesla, Amazon. Some of the biggest companies are listed in the United States, and Indian residents are legally allowed to buy their shares. There are direct and indirect methods for people looking for exposure to the international market, which can add more diversification to an individual’s portfolio that is otherwise focused only on India.
Are Indians allowed to invest in the US?
Under the Reserve Bank of India’s Liberalised Remittance Scheme (LRS), an Indian resident can remit up to $250,000 (approximately Rs 2.1 crore) per financial year for overseas investments without special approval. For most individuals, that limit is more than enough to build exposure to the US markets.
Individuals can invest in US stocks, ETFs, and mutual funds, but intraday trading and derivative trading are not allowed.
Two main routes to invest
There are two ways to participate in US markets from India: buying stocks directly or gaining exposure through funds.
1. Direct investment in US stocks
This means purchasing shares of US-listed companies in your own name.
Invest through an Indian broker with US partners
Many Indian brokerage firms partner with US brokers and offer international trading accounts. You complete the usual KYC formalities, link your bank account, remit funds in dollars, and place orders through their platform.
However, costs can be higher than domestic trading. Brokerage fees, foreign exchange conversion charges, and platform fees may all apply. Some brokers may restrict certain types of trades or limit access to specific securities. Before opening an account, it is wise to read the full schedule of charges instead of focusing only on advertised rates.
Invest through foreign broker
Another option is to open an account directly with an international brokerage that accepts Indian clients, such as Charles Schwab, TD Ameritrade, or Interactive Brokers. These firms often provide wider access to US markets and research tools.
That said, minimum balance requirements, compliance checks, and transfer procedures can be more detailed. Funds must still be remitted under LRS rules, and banks will apply currency conversion charges during transfers.
2. Indirect investment in US markets
If selecting individual US stocks feels overwhelming, indirect exposure may be more suitable.
Mutual funds
Several Indian mutual funds invest in US equities or global funds that hold American companies. You can invest in these schemes just like any other domestic mutual fund, without opening an overseas trading account or transferring money abroad yourself.
This approach places stock selection and monitoring in the hands of professional fund managers.
Exchange-traded funds (ETFs)
ETFs offer another route; one can either buy US-listed ETFs through an international broker or invest in Indian-listed ETFs that track indices such as the S&P 500 or Nasdaq-100.
ETFs usually provide diversification across many companies through a single purchase, and expense ratios are often lower than those of actively managed funds.
Conclusion
With the right platform, careful cost comparison, and attention to tax rules, Indian residents can participate in the growth of some of the world’s largest companies.
Like any financial decision, it should fit your goals, risk tolerance, and time horizon. Taking the time to understand the mechanics before sending money abroad can make the experience far smoother in the long run. It is important that you consult with your tax expert to understand the tax implications.