There is a growing interest of Indian investors in US stocks, driven by the desire to diversify and invest in global companies. As of today, the S&P 500 has gained more than 15% over the last 12 months, while the Nifty 50 is down by nearly 1.25 percent. After adding Rupee depreciation, the returns for an Indian investor investing in US stocks jump further.
But then, what to buy and how to go about buying US stocks most cost-effectively is equally important apart from the idea of diversification. Nikhil Behl, CEO of INDmoney’s Stocks Vertical, discusses Indian investors’ investments beyond the US, popular stocks, risk management, and common mistakes in an interview with Financial Express Online.
Given that Indian markets have been heading lower, and the rupee has been depreciating, has the flow of money by Indian investors into US stocks increased?
For Indian investors, investing in US stocks isn’t just about diversification—it’s about gaining a front-row seat to the next big revolution in technology and innovation.
Time and again, US companies have been ahead of the curve in shaping new industries, from the internet and social media to AI and electric vehicles, with large-cap and mega-cap giants leading the charge. The ability for someone sitting in India to identify these trends early and ride the wave of exponential growth is what makes US markets so compelling.
The past few years have provided clear examples, Indian investors who backed companies like Tesla, Meta, and Nvidia have seen staggering returns, with many more examples in the mid-cap space. As platforms simplify access and awareness grows, more investors are poised to benefit from these opportunities.
The returns from currency fluctuations are a bonus as they have historically worked in favor of Indian investors, further amplifying returns. And when they choose to redeem, the money sent out not only grows but also returns to India at a higher value, creating a powerful wealth-building cycle.
How has the overall interest in investing in the US changed over the years, if you can share data going back pre-covid to now?
The appetite for US stocks among Indian investors has undergone a dramatic shift over the years. Pre-COVID, investing in foreign stocks remained largely stagnant for nearly a decade, with access primarily limited to HNIs and ultra-HNIs.
However, post-2020, the landscape transformed. COVID, coupled with fintech platforms making US stock investing more accessible, acted as a catalyst driving a surge in retail interest in US stocks.
Since 2021, annual investment volumes have quadrupled, with over 2.5 million new Indian retail investors entering the space. And with US markets in a strong bull run, this surge has translated into significant wealth creation for Indian investors.
Would you be able to share the most popular sectors, stocks Indians are buying internationally?
Most Indian investors are buying the large-cap tech companies like the MAANG stocks—Meta (formerly Facebook), Apple, Amazon, Netflix, and Google (Alphabet). In addition, Nvidia and Tesla have been the most bought stocks over the last 18 months.
Indians that are investing regularly are also setting up SIPs in various ETFs that invest in themes and sectors. Amongst them QQQ (invests in Tech), SOXX (Semiconductors) and SPY (invests in S&P 500 stocks)
How’s the interest for other markets like China?
One of the lesser-known advantages of investing in US stocks is the ability to use US-based ETFs to gain exposure to global markets outside the US. Indian Investors have leveraged this route to invest in markets like Argentina, Germany, and Mexico. Investments in China-focused ETFs have remained relatively low under 5% largely due to the underperformance of Chinese equities and the impact of trade sanctions in recent years.
What’s your advice to Indians about investing abroad? And how would you suggest they go about it, if at all.
For Indian investors, investing abroad isn’t just about diversification, it’s about grabbing the opportunity to build wealth by investing in industries that are shaping the future. Some of the world’s most influential companies like Tesla, Microsoft, and Meta, are leading the charge in AI, cloud computing, and other breakthrough innovations that are set to define the new economy.
The next wave of wealth creation is unfolding in sectors like AI, semiconductors, and automation, where US companies are expected to take the lead.
Getting started is now easier than ever. Indian platforms have simplified the process significantly—account opening is free, there are zero AMC charges, and preferred banking partners enable seamless fund transfers in just a few clicks. Investors can directly invest in US stocks to gain exposure to these industry giants, or opt for US-based ETFs that offer a diversified approach.
While global investing requires a long-term perspective, the case for investing in the US market is stronger than ever. It’s not just a hedge—it’s a chance to be part of the companies and technologies that Indians engage with daily, and that are driving the future of innovation. And with easy access now available, there’s never been a better time to get started.
Finally, if you can share some dos and don’ts for international investing.
DOs
Choose the right platform – Select a platform that offers zero account opening fees, zero AMC charges, and zero deposit and withdrawal fees. Look for one that also simplifies the money transfer process with real-time tracking for a seamless experience.
Understand taxation – Be aware of capital gains taxation and TCS to ensure you invest in a tax-efficient manner.
Think long-term – Currency fluctuations and market volatility are inevitable, but global investing works best with a multi-year horizon.
Also Read: Elon Musk’s politics and Tesla’s performance: Are they driving the stock down?
DON’Ts
Don’t concentrate all your investments in one stock or sector – Even the biggest tech names have faced corrections. A well-diversified portfolio, especially one that includes ETFs, helps manage risks effectively. Opt for a platform that allows you to invest in US stocks via SIPs, ensuring a systematic and disciplined approach.
Don’t ignore forex charges – Transferring money directly can often be more expensive due to hidden fees. Choose a platform that partners with preferred banks and offers pre-negotiated forex rates, allowing for cost-efficient and hassle-free money transfers.