So you live in the Caribbean and you want to invest in foreign stocks? BIG STOCKS EQUALS BIG MONEY, RIGHT? What if I tell you that you can? What if I tell you that you can have shares in major US companies like Amazon and Netflix without even being a citizen of the country?! In this episode, I’ll tell you where to start, what you need, and how much money you should begin with. 

You don’t have to be a US citizen to buy stocks in US companies. Plenty of Caribbean citizens are already participating in the U.S. stock market. So why have you been missing all these great opportunities to diversify and build your investment portfolio? Should you change that now? No worries, I’m here to help you answer just that. 

First, like in any other stock market, you need a broker. You can choose an international broker or a local one that allows for foreign investments. If you prefer to go international, you can complete the process online by looking for a discount broker that accepts international investors.

Using a U.S. Broker

Interactive Brokers, for example, which was founded in 1978, is one of the biggest US-based discount brokers. It’s regulated by several financial authorities globally, and it even has a $0 minimum deposit.  That’s right, you can open that account with no money.  Other accessible brokers include Tradestation and FirstTrade Securities. 

I know a lot of you may be familiar with Robinhood, especially with all the publicity in January over the Game-Stop situation.  Robinhood is a Commission-free trading app which has become very popular in the United States.  Unfortunately, however, the app-based broker is only available to U.S. citizens or permanent residents with a legal address in the 50 U.S. States or Puerto Rico.  So womp womp on that one.  But I do have other options, so keep watching.

Of Course, these US brokers are required to first comprehensively screen any foreign persons using their services. Truthfully, as a non-national, there are a few hoops that you may have to jump through before investing in U.S. stocks because foreign owners and holders of U.S. based assets are subject to laws intended to protect U.S. interests. 

Requirements for a U.S. investment account

You’ll have to provide adequate identification with a government-issued ID and or/a social security card, and also fill out a W8 BEN form and submit these to the online broker.  

What is the W-8 form? It’s from the Internal Revenue Service (IRS – the taxman).  It’s a form that foreign individuals and businesses must file to verify their country of residence for tax purposes and certify that they qualify for a lower rate of tax withholding. 

In addition to this, you’ll also need to submit proof of employment and source of funds. 

Once your application is approved, an international stockbroker can help you to manage your investments, and ensure that they comply with all laws. Plus, a broker in the U.S. will be familiar with how to navigate the intricacies of the American stock market. 

Using a local broker

But let’s face it… doing things online or remotely may not always be ideal, especially with the expensive international calls or lack of direct communication. Some of us prefer to call locally, visit offices, and inquire about services in person. Is there a way for you to do this without signing up with an international broker? As a matter of fact, there is. You can invest in foreign accounts through investment brokers in your country. In Jamaica, PROVEN Wealth, Sagicor Investments, Ideal Portfolio Services and VM Wealth are among those that provide access to a diverse listing of both Jamaican and U.S. securities. In fact, Analysts from PROVEN Wealth and Ideal often join me on Taking Stock to talk about the US stock market. 

PROVEN Wealth offers an easy, efficient, and low-cost way to invest in the overseas stock market. Their online platform allows internet savvy investors the opportunity to trade actively in the overseas market in real-time. Clients can even access timely updates and equity research with everything at the touch of a button.

Requirements for PROVEN Global Trading Account

If you want to open a PROVEN Global Trading account, you’ll need a minimum of US$2000 to start.  You must:

1. Sign a PROVEN Global Trading Agreement
2. Log in online to the PGT platform and:

a.Complete Tax Form

1. Enter Security Questions and Answers
2. Reset Password
3. And Complete 2 Factor Authentication

After the account is activated, you can fund your PROVEN Global Trading Account through PROVEN Wealth Limited. You will then be able to trade directly on the PGT Platform or mobile app.

Investing in foreign stocks can allow you to diversify your portfolio and give you exposure to the growth of other economies. These companies can help you to navigate through investing in new markets and make your money work for you. Research the different opportunities for foreign investment available to you so that you can access larger opportunities for your money to grow. 

Categories: MoneyMondaysJA