Yes, under the Liberalized Remittance Scheme (LRS) of the Reserve Bank of India (RBI), Indian residents can remit up to USD 250,000 per financial year for investments and other purposes. This means you are legally allowed to invest in US stocks, ETFs, and other financial instruments.
How Indians Can Invest in the US Stock Market
1. Through Indian Brokerage Tie-ups
Numerous Indian brokers have partnerships with foreign brokers, including ICICI Direct, HDFC Securities, Axis Securities, Kotak Securities, Motilal Oswal, and Groww.
- ✅ Easy account opening
- ✅ Allows direct investment in US-listed stocks like Apple, Amazon, Tesla
- ❌ Higher brokerage/forex charges compared to global brokers
2. Through International Brokerage Platforms
Global brokers like Interactive Brokers, Vested, INDmoney, Webull allow Indians to open an account and directly trade in US stocks.
- ✅ Access to multiple US exchanges (NYSE, NASDAQ)
- ✅ Better trading features, fractional shares
- ❌ May require more documentation (KYC, bank details)
3. Purchasing US-focused mutual funds and exchange-traded funds (ETFs) in India
If you don’t want to open an international account, you can invest in Indian mutual funds that invest in US stocks/ETFs.
Examples:
- Motilal Oswal Nasdaq 100 Fund of Fund
- Franklin US Opportunities Fund-Franklin India Feeder
- ICICI Prudential US Bluechip Equity Fund
- ✅ A US trading account is not required.
- ✅ Managed by Indian AMCs
- ❌ Higher expense ratios compared to direct US ETFs
4. Indian Exchange-Traded Funds (ETFs) Monitoring US Indices
Some ETFs listed in India mirror US indices. For example:
- Motilal Oswal Nasdaq 100 ETF
- Nippon India US Equity Opportunities Fund
- ✅ Traded on Indian exchanges like NSE/BSE
- ✅ Purchasing through your Indian broker is simple.
- ❌ Limited US stock coverage compared to direct investing
Costs & Considerations
- Forex Charges – Every remittance from INR to USD incurs forex conversion charges (approx. 0.5% – 1%).
- Taxes –
- Dividends from US stocks are taxed at 25% TDS in the US.
- Capital gains are taxed in India as per your slab (since India and US don’t have double taxation on capital gains for individuals).
- Brokerage Fees – Varies depending on the broker (Indian or international).
- Regulatory Limit – Cannot exceed USD 250,000 per year per individual under LRS.
Benefits of Investing in US Markets
- 🌍 Global Diversification – Reduce risk by spreading beyond Indian markets.
- 💡 Exposure to Global Giants – Own shares of Apple, Amazon, Microsoft, Tesla, Google.
- 📈 Currency Hedge – The US Dollar usually appreciates against the Indian Rupee over time, boosting returns.
- 🚀 Access to Innovative Sectors – Tech, AI, healthcare, and EV companies not listed in India.
Risks You Should Know
- Currency Risk – If INR strengthens against USD, your returns may reduce.
- High Costs – Forex, brokerage, and tax on dividends can eat into returns.
- Market Risk – US stock markets also face volatility, inflation, and recession risks.
Conclusion
It is possible to invest in the US stock market from India, either directly through brokers or indirectly through Indian mutual funds and exchange-traded funds (ETFs). If you want direct exposure and control, opening an account with an Indian or global broker is the best choice. If you prefer simplicity, US-focused mutual funds in India may be better.
👉 The key is to start small, understand costs and tax implications, and then gradually build your global investment portfolio.
