The world shifted to a new normal post the pandemic which hit the world in 2020. It has changed the way we invest, spend, and save money. Investors are more focused on preserving capital and not afraid of going global.
Investors can reduce the risk by diversification. ‘Diversification' is a term that is not limited to India or sectors alone. To minimize the risk, investors are investing a small part of their portfolio towards global markets – a percentage that will only be going to increase in the near future.
A big factor that makes global investing attractive is the sheer outperformance seen in the recent past. The S&P BSE Sensex might have more than doubled in the last 10 years but S&P 500 index rose more than 200 percent in the same period.
The main indexes of Wall Street — the S&P 500 (GSPC), the Dow Jones (DJI), and the Nasdaq (IXIC) — have maintained this trend over the past five years as well, more than doubling people’s investments.
One big advantage of putting money into US markets is that it gives access to investors to deploy money in companies that have a global presence. The US market is home to companies such as Facebook, Google, Apple, GM, Tesla etc.
Now, most of these companies are part of our daily lives here in India, and given the way technology has shaped up in the last one year post the pandemic – the trend will only going to increase.
US market is home to (FAANG). If you are wondering what FAANG is – let me simplify. FAANG is an acronym used for 5 most popular American technology companies: Facebook, Amazon, Apple, Netflix, and Alphabet (formerly known as Google).
Now there is one more name that is slowly getting added to the popular FAANG list is Tesla – which is associated with electric cars, solar and integrated renewable energy solutions for homes and businesses.
The pandemic has created the inherent need for investors to go beyond their home country, to safeguard themselves from volatility. Apart from the FAANG stocks, there are many more companies which Indian investors could consider are Zoom, as well as Microsoft which have become household names.
Most of the corporate meetings or classes in schools or colleges are happening either on Zoom or Microsoft Teams on a daily basis – the growth story here is much bigger than what one can see right now.Global diversification also comes in handy if you plan to send your children abroad for further studies as the returns can also be used in Dollar terms. And, in addition to equity returns investors should also keep in mind the angle of currency depreciation. In the past 10 years rupee has moved from Rs 44 per US Dollar to over Rs 70 per US Dollar.
Ways to Invest in US Stocks:
Investing in US markets is easy now thanks to various discount brokerage firms as well as specialized brokerage firms such as Stockal have opened doors to Indian investors to invest directly into stocks of US markets.
There are two ways in which Indian investors can invest in US markets. One is via direct investment and the other is indirect investments.Direct investments simply mean investing in US stock directly by opening a trading account with a domestic or foreign broker such as https://moneycontrol.stockal.com
Indirect investments are done via Mutual Funds, Exchange Traded Funds (ETFs).
And, lastly if investors are not aware of which companies to choose from or which funds to buy, then they can opt for investing in pre-curated portfolios which is exclusive to Stockal known as ‘Stacks’.https://www.moneycontrol.com/news/special-site/article/stacks-the-one-click-portfolio-investment-6562961.html
Stockal’s Stacks is one such robust offering that helps you keep your money in the right instruments and grow your wealth which given investors complete freedom.
So what are stacks? Well, Stacks are pre-configured baskets of stocks & ETFs (exchange-traded funds) that you can invest in with a single click.
You can trust stacks because these are developed by hedge funds, global asset management companies, experienced wealth management firms, and portfolio managers.
The ready-made portfolio consisting of these instruments is usually based on a theme or an idea, ranging from healthcare and electric vehicles to internet technologies, capital goods, and ESG (environmental, social and governance), among others.
For wealth to grow there are 2 things which are absolutely necessary. One is patience and the other is an investment in the right products, stocks, ETF, or funds.
Now many of us don’t have the time and energy to understand the business impact of US companies sitting here in India and that’s where ‘Stack’ comes in.
A long-term investment in such products would help you grow your investments and mitigate the risks while watching your money grow at the same time.
Stack help you diversify your portfolio, and the fact they are managed by experts, investors can be rest assured about the quality of stocks or ETFs picked up.
Considering the fact that Stacks are thematic in nature they are build to ride the ongoing wave be it is Electrical Vehicle space or consumption or infrastructure which could come into the spotlight after the multi-million dollar plan unveiled by the US Government to support the economy.Various stacks that are on offer are US Tech Bluechip Portfolio, Electric Vehicle Portfolio, The Obvious Portfolio, Peace of Mind ETF, and Global ETF Portfolio.
(This is a partnered post)
Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.