Global investing · Guide
Avenues: US stocks, ETFs, and India-listed wrappers
Direct US access via LRS, international mutual funds, and NSE/BSE ETFs — with trade-offs on cost, minimums, liquidity, and complexity.
Route A — US brokerage via LRS
How it works: Complete KYC with an Indian entity tied to a US broker (or a standalone global platform). Remit under LRS; USD lands in your brokerage account; you buy US-listed stocks and ETFs.
Best for: Specific US companies, broad ETFs (VT, VOO, QQQ), and tax-loss harvesting in US wrappers where supported.
Watch-outs: FX on every funding event; US estate-tax exposure for large US situs assets (seek advice if net worth is material); fractional shares may have odd tax lots.
Examples of access patterns Indians use: full-service banks with global desks, discount brokers with US tie-ups, and app-first platforms marketing zero-commission US trades.
Route B — International mutual funds (India domiciled)
How it works: You buy units of a fund registered in India that invests overseas (often via a feeder into a Luxembourg or US mother fund). SIP in INR; no annual LRS tracking for the underlying investment.
Best for: Hands-off global equity or debt, small ticket sizes, investors who do not want a US brokerage login.
Costs: Total expense ratio (TER) often 0.5%–1.5% plus embedded fund charges; less transparent than a single ETF TER but simpler operationally.
Liquidity: Redemptions settle in rupees on T+3-ish cycles; NAV is once daily.
Route C — India-listed ETFs
How it works: Buy an ETF on NSE/BSE that tracks a foreign index (Nasdaq 100, S&P 500, Hang Seng, gold, etc.). Trades like a stock; iNAV vs market price can diverge intraday.
Best for: Tactical allocation, intraday liquidity, pairing with existing demat account.
Costs: TER + brokerage + tracking error; premium/discount to iNAV matters — use live iNAV tools before large orders.
Tax: Treated as equity or non-equity depending on the ETF’s underlying classification — confirm with the factsheet; misclassification hurts at redemption.
Route D — GIFT City (IFSC)
How it works: Invest through funds or platforms operating in Gujarat’s International Financial Services Centre with USD books.
Best for: Specific offshore funds, some AIFs, and investors already working with private bankers.
Watch-outs: Separate KYC, minimum ticket sizes, and a thinner product shelf than US markets.
Choosing among routes
Monthly ₹10,000–₹25,000 global SIP: international MF or India-listed ETF usually beats repeated LRS micro-transfers.
Concentrated US tech sleeve: LRS into US ETF.
Need to see live premium to iNAV: India-listed ETF with an iNAV tracker.
You already file Schedule FA: any route works; pick the one with cleanest statements for your CA.