NSE IFSC to allow trading in US stocks! Should you invest?

Indian retail investors will now be able to buy and sell stocks of companies like Apple, Google, Alphabet and other known listed US companies.
 
NSE International Exchange (NSE IFSC), which is a wholly-owned subsidiary of the National Stock Exchange (NSE), had announced trading in US stocks which will be facilitated through the NSE IFSC platform.
 
To begin with, NSE IFSC is offering trading for Alphabet (Google), Amazon, Tesla, Meta Platforms (Facebook), Microsoft, Apple, Netflix, and Walmart.
 
NSEIFSC Receipts on US Stocks will be traded in US Dollars. Minimum price movement in NSEIFSC Receipts on US Stocks in either direction shall be set as one cent (US $ 0.01).
 
The trading shall be conducted over two calendar days and such trading cycle shall be considered as one single business day.
 
Sharing the opinion on NSE IFSC, Hemang Jani, Head Equity Strategy, Broking and Distribution, Motilal Oswal Financial Services Ltd said, "Indian retail investors will be able to transact on the NSE IFSC platform under the Liberalized Remittance Scheme (LRS) limits prescribed by the Reserve Bank of India (RBI)."
 
"Under the LRS framework of RBI, it permits the resident individuals to remit up to $2,50,000 per financial year for any permitted current or capital account transaction," he added.
 
Talking about the benefits, he said that it's an additional investment opportunity for Indian investors with an easy investment process and at a low cost.
 
Investors will be able to hold the depository receipts in their Demat accounts opened in GIFT City and will be entitled to receive corporate action benefits pertaining to the underlying stock.
 
Also, he highlighted that there is also an option to trade in fractional quantity/value when compared to the underlying shares traded in US markets.
 
"The listing of foreign stock derivatives on NSE IFSC will make investing in foreign stocks more accessible. Currently, the route to invest in US stocks is cumbersome and expensive, making the process much easier and low cost," Sonam Srivastava, Founder at Wright Research told Business Today.
 
"The users can also trade fractional quantities as the shares are listed with fractional lot sizes. This listing will help Indian investors access the new asset class of US equities in a more meaningful way. This facility starts only with eight stocks and is soon planned to expand to 50 stocks," she added.
 
Trading holidays for NSEIFSC Receipts on US Stocks will be as per US Trading Holidays as well as Trading Holidays at the Exchange as communicated through circular from time to time.
 
Wondering how to invest? Well, Hemang Jani just made it easier for you!
 
Step 1: Open trading and Demat account with NSE IFSC registered brokers. (Presently 36 brokers are registered)
 
Step 2: Transfer funds from your local bank account to NSE IFSC registered broker’s bank account
 
Step 3: Once the fund reflects in your broker's account, you are ready to trade in NSE IFSC US Stocks.