This Article was fact checked and last updated for accuracy on April 29, 2025 by Mani Karthik
Hello folks! Mani here. The guy who tried to maintain his US investments after returning to India. Failed spectacularly.
I came back in 2017. Wanted to keep my Apple and Tesla stocks. My US brokerage sent me breakup email. “It’s not you, it’s your Indian address.”
Let me save you from my international investment heartbreak.
Why Invest in US Stocks from India? 💰
The US market gives you access to global giants. I wanted to keep my tech stocks. Silicon Valley gave me paycheck for years. I wanted to stay loyal.
My Indian relatives thought I was crazy. “Why invest in American companies when we have our own Sensex?” Fair question. But have you seen Apple’s returns?
| Benefit | US Market | Indian Market | My Confused Portfolio |
|---|---|---|---|
| Global Exposure | Direct access to FAANG | Limited ADRs | Split between both markets |
| Sector Diversity | Deep tech, healthcare, EVs | IT, pharma, banking heavy | Accidentally sector concentrated |
| Currency Hedge | Dollar appreciation benefit | Rupee depreciation risk | Found out about this benefit too late |
I initially thought maintaining US investments would be simple. Like performing heart surgery on yourself. While blindfolded. During an earthquake.
The Direct Investing Platforms 🖥️
Some platforms let you directly invest in US stocks. I tried most of them. Created multiple accounts. Forgot most passwords.
| Platform | Fees | Minimum Investment | My Platform Drama |
|---|---|---|---|
| Vested | 0.5% forex markup | $0 | My first platform. Struggled with funding |
| Groww | ~2% forex markup | $0 | Used briefly. Confusion with tax forms |
| INDmoney | 0-1% forex markup | $0 | Discovered after opening 3 other accounts |
I once sent money to my US investing account. The transfer took so long I forgot why I was investing. By the time money arrived, the stock had moved 15%. In wrong direction. My timing remains impeccable.
The US Brokers with Indian Access 🇺🇸
Some US brokers accept Indian residents. Finding them was like searching for unicorns. With broken GPS. During fog.
| Broker | Account Type | Key Feature | My Experience |
|---|---|---|---|
| Interactive Brokers | International | Lowest overall fees | Confused by their 73-page application |
| Charles Schwab | International | $0 commission | Requires $25k minimum. I had $24k. Was rejected |
| TD Ameritrade | International | Good research tools | Applied. Got ghosted. Still waiting for response |
I tried maintaining my existing US brokerage. They sent compliance email. Then restriction notice. Then account freezing warning. Our relationship status: It’s complicated.
The Mutual Fund Route: Feeder Funds 📊
Indian mutual funds that invest in US markets. Simpler option. I discovered these after creating multiple direct accounts.
| Fund | Expense Ratio | Focus | My Fund Selection Method |
|---|---|---|---|
| Motilal Oswal S&P 500 | 0.49% | S&P 500 Index | Friend recommendation. Actually worked out! |
| Franklin India Feeder | 0.89% | US Opportunities | Random internet comment. Mixed results |
| Kotak Nasdaq 100 FoF | 0.75% | Tech heavy | Panic bought during tech rally. Learned about volatility |
I invested in US feeder fund right before US imposed investment restrictions. Fund stopped accepting money. My timing remains legendary. In wrong way.
The ETF Route: Simpler but Limited 📉
ETFs trade like stocks but hold baskets of securities. I discovered these after trying all more complicated options.
| ETF | Focus | Liquidity | My ETF Adventure |
|---|---|---|---|
| MOFSP500 | S&P 500 | Medium | Found out about this after individual stock struggles |
| KOTAKNV20 | Nasdaq 100 | Low | Tried buying. Order didn’t fill for days |
| ICICITECH | US Tech | Low | Forgot time difference. Placed order during US night |
I tried buying US market ETF during US market closed hours. Expected immediate execution. Order sat pending. Called broker asking why. They explained time zones exist. Educational moment.
Documentation Requirements: Paper Nightmares 📑
Investing in US stocks requires documents. Many documents. I had none prepared properly.
| Document | Purpose | My Documentation Saga |
|---|---|---|
| W-8BEN | Tax treaty benefits | Filed wrong version. Twice |
| LRS Declaration | FEMA compliance | Bank refused form first time. Wrong format |
| PAN Card | KYC verification | Submitted expired card initially |
I filled W-8BEN form incorrectly three times. US tax forms should come with psychological support hotline. I needed therapy after third rejection.
Fund Transfer Mechanism: The Money Bridge 💸
Getting money to US brokerages requires process. I followed wrong process. Multiple times.
| Transfer Method | Cost | Timeline | My Transfer Drama |
|---|---|---|---|
| Wise | 0.4-0.5% | 1-2 days | Discovered this after paying bank fees for months |
| Bank Wire | 2-3% | 2-3 days | Used this initially. Paid maximum possible fees |
| Platform Built-in | 0.5-2% | 1-3 days | Convenience costs extra. Learned expensive way |
I used bank wire for first transfers. Paid 3% fees. Later discovered Wise. Calculated money wasted on fees. That amount could have bought nice vacation. Instead funded bank profit margins.
Tax Implications: The Double Trouble 🧾
US investments have tax complications. I discovered most after tax filing deadline.
| Tax Aspect | US Requirement | Indian Requirement | My Tax Confusion |
|---|---|---|---|
| Dividend Income | 25% withholding | Add to global income | Reported incorrectly first year |
| Capital Gains | No US tax for non-residents | Taxed as per India rates | Failed to claim foreign tax credit |
| FATCA Reporting | Annual filing | Schedule FA in ITR | Discovered this requirement after deadline |
I once received US dividend without understanding withholding. Calculated taxes wrong. My accountant found error. Asked if I was intentionally trying to donate to both governments. Fair question.
Investment Limits: The LRS Ceiling 💼
Liberalized Remittance Scheme limits overseas investments. I discovered this mid-transfer.
| Limit Type | Amount | Reset Period | My Limit Drama |
|---|---|---|---|
| Individual | $250,000 | Financial Year | Thought it was monthly limit initially |
| Family of Four | $1,000,000 | Financial Year | Tried to use wife’s limit without her documentation |
| Transaction Minimum | Varies by platform | None | Some platforms rejected my small test transfer |
I tried sending large amount abroad. Bank called asking for purpose. I said “stock investments.” They requested 37 different documents. I provided 35. Process delayed until market had moved 12%. Again, in wrong direction.
Final Thoughts From an International Investing Mistake Expert 🧠
Investing in US stocks from India is possible. Even for returning NRIs. It just requires more paperwork. And patience. And possibly therapy.
I went from investment confusion to investment clarity. Eventually. After creating enough problems to qualify as case study in international finance textbooks.
Start simple. Prepare documents. Understand limits.
And remember: The US market will still be there after you complete paperwork. Unlike me who rushed transfers to catch stocks that immediately dropped after purchase.
Got questions about investing in US stocks from India? Drop them in comments. My expensive mistakes are your free education.
Sources and Helpful Links:
- Reserve Bank of India – LRS Guidelines: https://www.rbi.org.in/Scripts/FAQView.aspx?Id=115
- SEBI Guidelines for Offshore Investments: https://www.sebi.gov.in/legal/circulars/oct-2015/circular-on-schemes-of-mutual-funds-investing-in-overseas-financial-assets_30755.html
- Income Tax Department – Foreign Asset Declaration: https://www.incometaxindia.gov.in/Pages/international-taxation/foreign-assets.aspx
- Interactive Brokers India Residents Info: https://www.interactivebrokers.com/en/accounts/open-account.php
- US-India Tax Treaty Overview: https://www.irs.gov/businesses/international-businesses/united-states-income-tax-treaties-a-to-z
- Vested Finance Platform Data: https://vested.co.in/