Stock markets often give people fear because they think it is tricky to understand. Not to worry because they are not as tricky as you thought. Nowadays it has become really easy to invest in global stocks while in any part of the world. Let’s have a look at how can you do this while staying in UAE.
How to create an account for trading directly in the global stock exchange?
In current times, the online fight in terms of the stock exchange has become even more fierce and the real beneficiaries are the traders involved. With this, the trading cost has also been reduced to a certain extent.
- Method 1 to open your account – Local broker method
You can hunt and look for the best local based broker who has access to the international stock market near you. You will find many so compare and choose the best for you and the one nearest to you.
- Method 2 to open your account – Online brokerage company
The next way is to search for an online brokerage company from amongst the top companies which allow access to the global stock market. Once you find the company which suits you the best, just get in touch with it and get your trading account open.
How are local brokers better than foreign brokers?
Local brokers offer you one a shop stop, to get access to your trading account, and let’s expand your access from UAE and Saudi Arab to major global stock markets like New York Stock Exchange (NYSE) and London Stock Exchange (LSE). Foreign brokers may have better online access and can provide better customer service but it’s still better to stay with a local broker because they provide competitive rates on execution cost. Nowadays, almost every broker, locally or abroad, who has access to the international stock market can help you open a trading account without any hassle.
Local brokers deal with local entities and not abroad-based entities. They make the transfer and withdrawal of funds easy as this takes place from the local banks. In these terms, foreign brokers provide a more customer-friendly platform and have low executive costs. However, with foreign brokers, funds will be handled outside the resident country which can prove to be an added disadvantage.
Other Ways to invest in the foreign stock market.
It is always a good idea to look at several options that are available to you in terms of investments. Though this generation has access to business news 24/7 still they run at a risk of fake news and chaos. You still have stress and tension about any loss that might come your way. So if you are ready to risk a principal amount to get a good profit, here we have some options to ease your research work. As you already know by now, that investment is not bound by geography so here we bring to you some ways which are suitable for all types of investors.
- Global Depository Receipts (GDR) – This is a type of depository receipt, in which a depository bank issues shares of the international market and makes them available to global investors. These are traded, cleared, and settled in the same way as domestic stocks. Most GRDs use the dollar as a denominator while some also use the euro.
- Global Mutual Funds – If you are looking for a hassle-free method to explore the international trade market then this is the perfect option to do so. In terms of benefit, they are more a kind of mutual fund but they hold a portfolio of foreign stocks rather than domestic stocks. The way of its working is also similar to regular mutual funds. These funds have a variety including something for everyone. This includes international index funds, global funds, international funds, and regional funds.
- Exchange-Traded Funds (ETFs) – This is a very convenient way for interested investors to invest in the foreign market. You just need to pick up the right ETF according to your need and lifestyle. You will find a variety of options in categories such as investment style, investment sector, market capitalization, and geographical region. You should consider cost, fees, liquidity, portfolio, and taxation before investing in international ETFs.
- Multinational Corporations (MNCs) – This option is for those investors who are not comfortable with both depositaries and directly buying methods of shares. They can look for domestic companies that have a large number of their sales and revenues overseas. These companies are termed Multinational Corporations (MNCs), for example, McDonald’s and Coca-Cola Company in the USA. These will not give true international diversification but will surely give you a stake in international growth.
So this was some important information that you need to know once you have made up your mind to invest in international stocks. Otherwise, also, this information can be helpful for general awareness. Now you know the options that you need to munch on when you want to invest your hard-earned money and want to see it multiply. Have a happy investment journey ahead.
Disclaimer: All content provided on this blog is for informational purposes only. The owner of this blog makes no representations as to the accuracy or completeness of any information on this site or found by following any link on this site. The owner will not be liable for any error or omissions in this information nor for the availability of this information. The owner will not be liable for any losses, injuries, or damages from the display or use of this information. We recommend that you independently research and verify, any information that you find on our Website and wish to rely upon
