Global investing becomes cheaper as trend catches on
Platforms like Stockal, Winvesta and Vested Finance among others who offer international trading facilities have brought down their commissions even as they work towards lowering other charges.
At a time when an increasing number of Indian retail investors are looking to put money in foreign companies that are listed outside India, global investing platforms are looking at ways to reduce the overall cost of trading to boost their business and also the overall segment.
Platforms like Stockal, Winvesta and Vested Finance among others, who offer international trading facilities, have brought down their commissions even as they work towards lowering other charges that an Indian investor has to incur while trading in shares of companies that are listed overseas.
This assumes significance as many Indians now look at diversification within their equity exposure or allocation by buying shares of US-listed companies like Meta, Tesla, Amazon, Alphabet, Apple and Netflix among others.
“Most trading platforms including Stockal have reduced commissions to 1 cent/share as global investing has become an increasingly important concept for asset allocation,” says Vinay Bharathwaj, co-founder & co-CEO, Stockal, while highlighting the fact that overseas investing entails other costs like bank service charges and withdrawal fees as well.
“As we see more and more investor interest, we can certainly bring these costs down drastically. This is something which we are working very actively to bring it down and to make global investing even more affordable,” adds Bharathwaj.
The growing interest is corroborated by the fact that all such platforms have registered a significant rise in the quantum of trading in the last couple of years. Interestingly, the trend was triggered during the lock down when an increasing number of individuals – potential investors as well - were hooked onto Netflix, Amazon, Meta and Twitter among other US companies.
Initially, however, the trading cost was a huge deterrent as every trade would put the investor back by $10 to $15 – a huge cost especially in Indian currency.
“Cost of investing in the US markets is declining every year. Till a few years ago, US stock investment platforms charged as much as $10 per month and $10 per transaction. Today, the cost of investing in US stocks is a lot lower,” says Swastik Nigam CEO & founder, Winvesta.
“There is no monthly fee or trading commissions. The only charges are related to movement of money. Beginning of this year, Winvesta participated in RBI’s sandbox to help fund US brokerage accounts through UPI for zero fixed fee. When it becomes permanent, retail investors will be able to transfer as little as Rs 2,000 for no fixed fee and forex spreads under one per cent,” added Nigam.
Incidentally, Winvesta also allows free withdrawals from brokerage account to Winvesta multi-currency account (MCA) while charging only a fixed fee of $1 for withdrawal from the MCA to Indian bank account. We are looking to reduce this even further and make withdrawals completely free,” says Nigam.
Meanwhile, Vested Finance, which is one of the leading platforms in this segment, has a facility called Vested Direct wherein no fixed fees are levied on the transaction and the investor has to only bear a forex mark-up of 1.2 per cent.
“The costs have substantially come down over the years and we at Vested are committed to bringing them down further,” says Viram Shah, Co-founder & CEO, Vested Finance.
There are some withdrawal charges involved, but we will bring that down soon, added Shah.
