Every year, plenty of students fly overseas to pursue their education in their dream universities abroad. Despite the pandemic and restrictions in place, the Ministry of Foreign Affairs estimated nearly seven lakh Indian students flying abroad for their studies. The Liberalized Remittance Scheme (LRS) of the Reserve Bank of India (RBI) showed that Indians remitted an average of $10 billion for the purpose of foreign education over the last three years. Foreign universities are generally expensive compared to universities in India. It is wise to plan financially well in advance. Here is why and how to invest in international stocks from India.
Why Invest in International Stocks?
Typically, most people invest in the Indian market to gain profits through payouts, dividends, and other means, However, the Indian Rupee has depreciated in comparison to the dollar. This makes the process of gaining wealth more challenging. Currency depreciation is a key parameter to consider while financially planning to cover tuition fees.
In 2020, according to the Ministry of External Affairs, nearly 261,406 Indian students continued to pursue their education abroad. In 2019, this number increased more than twice to 588,931. However, the Indian Rupee as a currency has been depreciating in value. So, it would be a smart choice to buy international stocks to experience the benefit of an increase in valuation and fund international education without any hassle. You can also experience several other benefits such as the following:
1. Outperformance
The U.S. stock market has outperformed almost every other global market over the past 25 years. In 2017, the DOW index increased in value by 25% and S&P stocks increased by 19% in value. In the same year, the Argentina stock market rose exponentially by 77% hitting a record high in the final week of 2017.
2. Currency Fluctuation
With the continuously depreciating value of the Indian Rupee, investing in foreign markets can be extremely lucrative. Even in cases where the price of a particular stock may not increase greatly, the difference in the currency exchange prices can provide an increase in profits.
3. Global Growth
It is key to note that, with respect to international investing, most markets are mature markets and that growth is cyclical. So, you can capture high profits from shifting economic cycles if you buy international stocks.
4. Portfolio Diversification
Investing outside of India can offer you a wider choice of investment instruments. By investing in such stock, you can diversify your portfolio and reduce the overall risk involved with your portfolio.
How to Invest in International Stocks from India
There are plenty of stockbrokers in the Indian stock market that facilitates international investing. So, ensure that you create a Demat and a trading account with a broker that supports international investing. You also have the option to open an account with an international broker. It is always best and more convenient to invest in global stock through a streamlined process and a single platform. International investing has been made easy by Globalise with an additional advantage of several globes for different financial goals. Get started right away to reap the most benefits.
In a Nutshell
Buying international stocks can be helpful when it comes to planning finances for your child’s study abroad needs. With the plethora of benefits provided by the international markets, you can not only experience high returns but can also mitigate your risks by diversifying your portfolio. You can invest globally to build wealth to further support your child’s education with Globalise.