Invest in
US Stocks from India

Yes, Indian investors can invest in the US stock market. Through Vested, investors can directly buy stocks and ETFs in the US market per the RBI’s Liberalized Remittance Scheme (LRS). The LRS is a policy established by the Reserve Bank of India that permits residents of India to freely remit up to $250,000 per financial year for investment and expenditure overseas.

While you can’t directly purchase individual US stocks on the National Stock Exchange (NSE) of India, there is an option through the NSE’s International Financial Services Centre (IFSC) that allows you to invest in select US stocks. However, it’s important to note that this offering is limited to around 50 stocks, and there might be liquidity concerns.

For broader access, Indian investors can look into mutual funds or ETFs that invest in US equities or track major indices like the S&P 500, available through investment platforms such as Vested.

You can buy and sell US stocks in India by opening a brokerage account with a platform like Vested, which allows you to invest in over 5,000 US stocks and ETFs​.

In the US stock market, there are several categories of stocks that cater to different types of investors, each with unique characteristics and potential benefits. Here’s a breakdown of the various types:

1. Blue-Chip Stocks: These are shares of large, well-established, and financially sound companies with a history of reliable performance. They are typically industry leaders and may offer dividends. Examples include Johnson & Johnson, Procter & Gamble, and Apple
2. Growth Stocks: These stocks belong to companies that exhibit signs of above-average growth, though they may not pay dividends. Investors buy them for capital appreciation. Companies like Amazon and Tesla are often categorized as growth stocks.
3. Value Stocks: Value stocks tend to trade at a lower price relative to their fundamentals, such as earnings and dividends, and are sometimes considered undervalued by investors. Examples include Berkshire Hathaway and JPMorgan Chase.
4. Dividend (Income) Stocks: These are known for their robust dividend payouts, often coming from companies with stable and mature earnings. Examples are Exxon Mobil and Coca-Cola.
5. Defensive Stocks: Companies in sectors like utilities or consumer goods, which tend to be less affected by economic cycles, offer defensive stocks. These can provide stability to a portfolio during market downturns. Examples include Walmart and Johnson & Johnson.
6. ETFs (Exchange-Traded Funds): While not a category of stock, ETFs are investment funds traded on stock exchanges, holding assets such as stocks, commodities, or bonds. They offer diversified exposure to various sectors, indexes, or strategies.

Platforms like Vested enable investors to tap into the expansive US market by offering access to more than 10,000 US stocks and ETFs across these categories, providing Indian investors with a gateway to participate in global economic growth.

When you invest in US stocks from India, you’ll encounter two main tax considerations:

Capital Gains Tax: Any profits you make from selling your US stocks are taxable in India. The US does not tax these gains. The duration for which you’ve held the stocks determines how much tax you’ll pay. If you’ve held the stocks for more than 24 months, they qualify for long-term capital gains tax, which is 20% with the benefit of indexation. For holdings under 24 months, the gains are short-term and taxed according to your applicable income tax bracket in India.

Dividend Tax: Dividends from US stocks are taxed differently. They incur a 25% tax in the US. Thanks to the Double Taxation Avoidance Agreement (DTAA) between the US and India, you can claim a credit for this tax against your Indian income tax liability. This means the tax you’ve paid in the US can offset the amount you owe in India, preventing double taxation.

For Indian investors, the standard trading hours for the US stock market are from 7 PM to 1:30 AM India time. This timing aligns with the regular trading session in the US, which runs from 9:30 AM to 4:00 PM Eastern Time.

Additionally, Vested Finance offers Extended Hours Trading, adding an extra 9.5 hours of market access on each trading day. This feature allows investors to execute trades during the pre-market and after-market sessions, thereby capitalizing on new information and global events that occur outside the standard trading hours.

Understanding US Stock Market Timing is crucial for Indian investors as it helps in planning and executing trading activities effectively according to the market’s operational hours.

Popular US stock market indexes include the S&P 500, Dow Jones Industrial Average, and NASDAQ Composite​

The minimum amount to invest in US stocks can be as little as $1, especially when buying fractional shares through Vested​.

No, you do not need a foreign bank account to invest in US stocks from India. You can fund your investments through Indian bank accounts under the LRS.