Investing in US stocks from India has never been easier. With platforms offering fractional shares and zero account opening fees, a retail investor in Mumbai can now own Apple, Microsoft, or an S&P 500 ETF from their phone.
Legal Framework: LRS (Liberalised Remittance Scheme)
Indian residents (not NRIs) can invest in US stocks under RBI's Liberalised Remittance Scheme. You can remit up to USD 250,000 per financial year for investment purposes. This covers stocks, ETFs, and international mutual funds.
💡 Pro Tip: LRS remittances above ₹7 lakh attract 20% Tax Collected at Source (TCS) under the 2023 Budget, which can be claimed back when you file your ITR.
Route 1: Direct US Brokers via Indian Platforms
Platforms like Vested Finance, INDmoney, and Groww partner with US brokers (DriveWealth, Alpaca) to give Indian investors seamless access. You open a US brokerage sub-account through the app.
- Vested Finance — largest selection, fractional shares, ₹0 account fees
- INDmoney — integrated with Indian portfolio tracking
- Groww US — integrated with existing Groww account
- HDFC Securities International — bank-integrated option
- Winvesta — multi-currency account with US stock access
Route 2: International Mutual Funds (No LRS Needed)
SEBI-registered mutual funds with international mandates are the simplest route. No forex, no LRS paperwork. However, SEBI has capped overseas MF investments.
- Motilal Oswal NASDAQ 100 ETF / FoF
- Mirae Asset NYSE FANG+ ETF
- Nippon India US Equity Opportunities Fund
- Franklin India Feeder – Franklin US Opportunities Fund
Tax Treatment for Indian Residents
| Aspect | India Tax Rule |
|---|---|
| Holding < 24 months | Short-Term Capital Gain, taxed at slab rate |
| Holding ≥ 24 months | Long-Term Capital Gain at 12.5% (no indexation) |
| Dividends from US stocks | Added to income, taxed at slab rate |
| US dividend withholding | 25% withheld by US; can claim DTAA credit in India |
| TCS on remittance | 20% TCS above ₹7L LRS — refundable via ITR |
For NRIs: Even Simpler
NRIs with US bank accounts can directly open accounts with US brokers like Fidelity, Schwab, or TD Ameritrade (eligibility varies by visa/residency status). They can also invest through NRE accounts via LRS from India.
What to Invest In: A Starter Portfolio
- VOO / SPY — S&P 500 ETF (core US market exposure)
- QQQ — NASDAQ 100 ETF (tech-heavy)
- AAPL, MSFT, GOOGL — Individual mega-cap stocks
- VTI — Total US stock market ETF
- SCHD — Dividend-focused US ETF
⚠️ Important: Currency risk is real: if USD weakens against INR, your USD-denominated returns shrink when converted back to rupees. USD/INR has historically trended with USD strengthening, but this can reverse.
Key Risks to Consider
- Currency risk: USD/INR fluctuations impact your actual returns
- Regulatory risk: SEBI/RBI can change LRS rules
- Estate planning: US assets require a US will; subject to US estate tax for large holdings
- FATCA compliance: Your Indian bank may report US account activity to the IRS