Investment in the stock market is booming as the cloud around the stock market is getting clear of misconceptions. Indian Stock market is predicted to overtake major stock markets in capitalization in the coming few years. The number of investors in India has witnessed a surge in the last 2 years as new retail investors are getting encouraged with the market performance. Not only the market performance, but the number of IPOs is also increasing every year, indicating a good sign of the growth of the stock market as well as investors.
As an investor, you can also invest in the international stock market such as the US Stock market. Investing in the US Stock market has some promising benefits, benefits such as:
1. Access to Global Companies
Investing in US stock will allow you to get access to some of the best global companies such as Facebook (now Meta), Apple, Google, Amazon, and various others. Purchasing shares of these companies is simpler and practically identical to purchasing shares of Indian corporations on Indian stock markets. What sets it apart, though, is that the purchase is made through an international brokerage business, and as an investor, you must follow the RBI's foreign currency laws.
2. Invest in a fraction of US stock
You may hold US equities in fractions, unlike in India. After all, owning a single share in Amazon is out of reach for most people. You may buy a piece of the company for as little as Rs 5,000 or even less. With limited money, you can collect more or construct a portfolio of US equities over time.
3. Getting US Stock Market Returns
By investing in the US Stock market, an investor gets the profit, dividend, or both that an investor receives on his or her stock market investment in India. The US Stock Market return is higher in comparison to the Indian Stock Market. The New York Stock Exchange not only lists corporations in the United States but also companies from throughout the world. Investments in US Stock help you get a good US stock market return as global companies are there and the return you get will be high contributing to various factors.
4. Gains from US Dollar Currency Appreciations
The Indian Rupee has been declining against the US dollar, as seen by historical statistics, and there is a chance that it will continue to decrease. The exchange rate between the rupee and the dollar affects the profits you make from overseas equities. If dollar-denominated assets such as US equities appreciate, any depreciation of the rupee helps to improve profits. If the rupee declines versus the dollar, you benefit even if overseas markets underperform or remain unchanged.
5. Diversifies Your portfolio
Companies across the world are listed on all of the major US stock market making it a promising investing destination. When you invest in US Stock Market, you not only invest in global companies, but you also diversify your investment portfolio. A national emergency might bring the index down. However, the effect would be minor. Indian corporations, on the other hand, dominate Indian indexes. Even minor turmoil in the country might cause the indexes to plummet. The stock market in the United States is diverse, and it has proven to be resilient in the face of hardship. In the case of India, however, this is not the case.
It makes sense to invest in the US markets because of these above-mentioned benefits. However, there is also a warning for the potential investors. Large firms have significantly higher resistance to such challenges and, on average, bounce back faster. Furthermore, by investing in US markets, Indian investors benefit from the rupee's fall against the dollar, making investments significantly more appealing. In the previous ten years, the rupee has lost a significant percentage of its value against the dollar.