In today’s globalized world, limiting your investment portfolio to just domestic stocks can mean missing out on major growth opportunities. International stocks offer exposure to fast-growing economies, industry leaders outside your home country, and currency diversification. But how exactly do you invest in international markets?
In this comprehensive guide, we’ll explore how to invest in international stocks, the benefits, risks, and top platforms to get started.
✅ What Are International Stocks?
International stocks are shares of companies listed in stock exchanges outside your home country. For example, if you live in India and invest in Apple Inc. (listed on NASDAQ, USA), that’s an international stock for you.
🌍 Types of International Stocks:
- Developed Markets – U.S., Europe, Japan
- Emerging Markets – China, India (for non-Indian residents), Brazil
- Frontier Markets – Vietnam, Kenya, Bangladesh
📈 Why Invest in International Stocks?
🔹 1. Diversification
Spreading your investments globally reduces your portfolio’s dependence on your home economy.
🔹 2. Currency Advantage
A strong foreign currency (like USD) can boost your returns when converted back to your local currency.
🔹 3. Exposure to Global Giants
Invest in companies like Apple, Microsoft, Nestlé, or Toyota—industry leaders not listed in your home market.
🔹 4. Hedge Against Domestic Volatility
International exposure acts as a buffer during local economic downturns.
⚖️ Risks of Investing in International Stocks
While international stocks offer benefits, they also come with certain risks:
| Risk Type | Explanation |
|---|---|
| Currency Risk | Changes in currency exchange rates can affect your investment returns. |
| Political/Regulatory Risk | Foreign markets may have unstable governments or unpredictable regulations. |
| Information Asymmetry | Lack of access to reliable data in foreign markets can make analysis difficult. |
| Tax Complications | Withholding taxes and double taxation may apply. |
🛠️ How to Invest in International Stocks from India (or Any Country)
🔸 1. Through Domestic Brokers with Global Tie-Ups
Many Indian brokers have partnerships with foreign brokers, allowing Indian investors to invest globally.
Examples:
| Broker | Partner Platform | Markets Available |
|---|---|---|
| Zerodha | Vested | US Stocks |
| Groww | DriveWealth | US Stocks |
| ICICI Direct | Interactive Brokers | US & Global Stocks |
| HDFC Securities | Stockal | US Stocks |
Pros:
- Easy onboarding
- Seamless INR to USD conversion
- Integrated with Indian KYC
🔸 2. Investing via International Brokerages
You can directly open an account with a foreign brokerage.
Popular Options:
- Interactive Brokers
- TD Ameritrade
- Charles Schwab
- Saxo Bank
Pros:
- Access to multiple global markets (Europe, US, Asia)
- Advanced trading tools
Cons:
- Complex onboarding
- Higher minimum deposits
🔸 3. Through Mutual Funds or ETFs
If direct stock picking sounds risky, consider investing in international mutual funds or ETFs.
Examples:
| Fund Name | Region | Type |
|---|---|---|
| Motilal Oswal NASDAQ 100 ETF | USA | ETF |
| Franklin India Feeder – US Opp Fund | USA | Mutual Fund |
| PGIM India Global Equity Fund | Global | Mutual Fund |
| Vanguard Total International Stock ETF (VXUS) | Global | ETF (USA based) |
Pros:
- Professionally managed
- Lower risk than individual stocks
- No need for foreign brokerage account
🔸 4. Using Liberalized Remittance Scheme (LRS) – For Indians
Under RBI’s LRS, Indian residents can remit up to USD 250,000 per financial year for investing abroad.
Steps to Use LRS:
- Fill Form A2 with your bank.
- Provide PAN, passport, and investment intent.
- Convert INR to USD.
- Transfer to international broker platform.
💡 Tip: Your domestic broker may help with this process.
💸 How Much Should You Invest in International Stocks?
A balanced portfolio might include 10% to 30% international exposure depending on your:
- Risk appetite
- Time horizon
- Domestic market correlation
| Investor Profile | Recommended Global Allocation |
|---|---|
| Conservative | 10–15% |
| Moderate | 20–25% |
| Aggressive | 30–40% |
🔍 Top International Stocks to Watch in 2025
| Company | Country | Sector | Why Watch |
|---|---|---|---|
| Apple Inc. | USA | Technology | Consistent revenue & innovation |
| Alibaba | China | E-commerce | Growth potential in emerging Asia |
| Nestlé | Switzerland | FMCG | Stable dividend & global presence |
| Toyota | Japan | Automotive | EV shift & global market leadership |
| ASML | Netherlands | Semiconductors | Monopoly in EUV lithography |
📊 Performance: International vs Domestic Markets
| Market | 5-Year CAGR (Approx.) | Key Index |
|---|---|---|
| Indian Market | 12–14% | Nifty 50, Sensex |
| US Market | 10–12% | S&P 500 |
| Global Emerging | 8–10% | MSCI EM Index |
| Europe | 6–8% | FTSE, DAX |
While domestic markets like India have outperformed recently, long-term international exposure helps reduce risk.
🧮 Taxation on International Investments
📌 For Indian Residents:
- Dividends: Subject to 25–30% withholding tax (can be claimed under DTAA).
- Capital Gains:
- <24 months: Taxed as per your slab rate (Short-Term)
- >24 months: 20% with indexation benefit (Long-Term)
✅ Always consult a tax advisor for optimal tax planning.
📱 Best Apps for International Investing
| App Name | Platform | USP |
|---|---|---|
| Vested | Android/iOS | Simple US stock investing |
| Groww | Android/iOS | Mutual funds + US stocks |
| INDmoney | Android/iOS | Tracks all global assets |
| Webull | US-based | Advanced trading tools |
| Interactive Brokers | Multi-platform | Professional-grade investing |
🧠 Things to Consider Before Investing Globally
- Know Your Investment Goal – Long-term growth, passive income, or diversification?
- Understand Currency Movements – USD, EUR, JPY, etc. affect returns.
- Check Withholding Taxes – Country-wise tax rules may vary.
- Evaluate Fees & Brokerage Charges
- Start Small, Scale Later – Especially when new to global investing.
🔄 International Stocks vs Domestic Stocks: Quick Comparison
| Factor | International Stocks | Domestic Stocks |
|---|---|---|
| Growth Potential | Moderate to High | High (India in 2025+) |
| Currency Exposure | Yes | No |
| Risk Level | Medium to High | Medium |
| Access | Limited, but improving | Easy |
| Regulation Knowledge | Must stay updated | Familiar |
🏁 Conclusion: Is It Worth Investing in International Stocks?
Yes—international investing offers diversification, access to global innovation, and hedges against domestic market volatility. While it’s not without risk, smart investors can balance global exposure with domestic holdings for a more resilient portfolio.
✨ Final Tips:
- Start with ETFs or mutual funds if you’re a beginner.
- Use apps like Vested or INDmoney for easy access.
- Always consider currency and tax implications.
- Think long-term, and don’t chase hype.
❓ FAQs: How to Invest in International Stocks
Q1. Can I buy international stocks directly from India?
Yes, through platforms like Vested, INDmoney, and Groww.
Q2. Do I need a USD bank account?
Not necessarily—many brokers convert INR to USD automatically.
Q3. What are the risks of investing globally?
Currency fluctuation, regulatory differences, and foreign taxes.
Q4. Are international mutual funds safe?
They are generally less risky than individual global stocks, as they’re managed by professionals.
Q5. How much tax will I pay on global stock gains?
Typically, 20% long-term with indexation or as per your income slab for short-term.
