Cost-Effective Ways to Purchase Overseas Stocks

Successful investors, over time, have stressed on the importance of not putting all your eggs
in one basket. Have you ever looked at the American market, with its stocks, bonds, and currencies, as a single basket? While this might not seem like the case, especially when the market is going great guns, bear in mind that the American market witnesses downward spirals too.

If you ignore investment opportunities outside of the country, you are basically missing out on a significant chunk of the developed global investable stock market. It comes as no surprise that an increasing number of Americans are looking at investing in foreign shores, although not everyone know how to make their trades cost-effectively.

If you hoped to buy international stocks a decade or two ago, the process would have been cumbersome and anything but cost-effective. With technological advances, this is no longer the case. Now, you get to choose from different options that include American Depository Receipts (ADRs), Global Depository Receipts (GDRs) and direct investing. Matters get a little tricky if you choose to go the direct investing way. What helps is that the competition has ensured high levels of service coupled with reduced costs.

Turn to Your Broker Account

If you have an existing account with a mainstream brokerage firm, there is a good chance you might be able to use it to trade in overseas stocks. The cost involved may be a factor, though, because you will pay fees for the deal as well as for conversion of currency. Depending on the account you have or plan to open, you may also have to deal with minimum balance requirements. Fidelity, for example, requires that you hold at least $2,500 in your account at all time.

Turning to the internet may be a good idea as there is no dearth of reliable online brokerage companies from which to choose. NerdWallet’s list of best online brokers for stock trading in 2017 includes TD Ameritrade, Charles Schwab, E-Trade, OptionsXpress, Merrill Edge, and Fidelity.

Another option is to open a broker account in the country where you plan to trade. Examples include OCBC Securities in Singapore and Boom’s offering in Hong Kong. When it comes to funding these accounts, you get to save money in fees and exchange rates by turning to overseas fund transfer specialists such as TransferWise and WorldFirst.

Open an Account in a Foreign Currency

Setting up an account in another currency is usually a more cost-effective way when compared to using your regular American trading account. TD Ameritrade and Charles Schwab provide this service in the United States.

If you live outside of the U.S. and wish to open a trading account in the country, doing so is possible through a number of institutions. In such a scenario, you may lose money when transferring funds to your U.S. dollar account, which you can avoid by using specialist fund transfer companies. These companies tend to come with lower fees and typically better exchange rates when compared to most banks.

The Trading

After you load funds into your trading account comes the time to buy stocks. While you will need to provide details of the stock you wish to buy as well as how many you wish to purchase, you may also need to choose between market orders and limit orders. The former comes with instructions to carry out your trade as quickly as possible, at existing market rates. With a limit order, you get to set the maximum you are willing to pay for a stock, and this ensures that you do not end up overpaying.

Conclusion

A number of factors may affect the cost-effectiveness of trading in international stocks. Pay attention to the brokerage account you open, how you fund your account, how you withdraw funds from an overseas account, and how you actually carry out trades.

*Photo Credit: GotCredit (Creative Commons)

How To Raise Financially-Savvy Children in the Philippines

Parenthood is a unique career. You don't get to resign. You're not entitled to retire. It's a role that you commit yourself into until the end. Your child may have attained the age of majority, started paying his taxes, and have settled down with a family of his own, but your guidance as a parent remains as important as ever. It's your task to ensure that the lessons you impart will serve them in the future.

In the Filipino culture, children tend to live under the protection of their parents even when they reach adulthood. The Filipino family, in consonance with Asian practices, is close-knit. While this strengthens kinship, the safety net offered by an ever-supportive family can be detrimental to a child's readiness to face the challenges of the “real world.”

Help your child make sound financial decisions when he enters college and embarks into adulthood. Here are invaluable tips for you.

What You Need to Know About The Benefits of Comprehensive Car Insurance (Infographic)

As a car owner, you’re bombarded with many decisions – oftentimes small ones – concerning your vehicle and its needs. What brand of gasoline will give me the best mileage for its cost? How dark should the window tints be? Should I keep the leather upholstery bare or cover it up? What kind of gadgets will make my driving experience better? Is my car tire still fine or do I need to have it replaced already? What should I do with the scratches and paint chips?

Everything you need to Know about Microinsurance in the Philippines

People with low income are highly vulnerable to health problems and the destruction of their assets, harvest or livestock and homes due to natural and man-made catastrophes. And there is, of course, the looming danger of a sudden accident or death that practically every human being are all at risk.Unfortunately, low income people often do not have insurance coverage to protect them. This does not have to be the case though, as many different types of affordable and accessible microinsurance policies are now available. You can even purchase a microinsurance policy for as low as P20 in a nearby Palawan Pawnshop! Read more to learn about microinsurance and your options.

Photo courtesy of Geralt via Pixabay

4 Tips for an Easier Credit Card Approval

Qualifying for a credit card doesn’t mean that your application is approved. It means that you have basic qualifications like job tenure and income in order to apply for the credit card you’ve been eyeing.

Banks that issue credit cards will usually look at your credit history, records that all banks have access to which show whether you’ve had debt, how much was your debt, and if you were able to pay them off on time.

If you want to get your credit card approval without hassle, here are things to keep in mind:

Pay bills on time

Image source: wonderwomanimnot.com