How to Start Investing in US Stock Market – Complete Guide

In this blog we will understand How to Start Investing in US Stock Market, US stock market has a very interesting and good part, they provide a Fraction Share option to buy shares now many of you will think, what is a Fraction Share? So we will give you every piece of knowledge about that, for that please read the full article because half knowledge is dangerous if you’re learning new things, and here you learning about How to Start Investing in US Stock Market. So you have to be very careful, if your going ahead with the half knowledge you will face a loss in the stock market. To earn a profit on your investment learn and understand everything about the market.

How to Start Investing in US Stock Market in Hindi

How to Start Investing in US Stock Market

If we often use Facebook, Microsoft, Netflix, Amazon, Google (Parent Company of Alphabet), and so on… in our daily life. we pay these companies for their subscriptions then we can invest in these companies and we can also earn profit from these companies.

So firstly start gaining knowledge about these companies because it is easy to know everything about those companies which we use often. and it is easy to start investing in these companies. and from that, we can understand How to start Investing US Stock Market.

Stock Exchange Of US Stock Market

As you all know, NSC & BSC are the Stock Exchanges of India, like the NYSE & NASDAQ, are the Stock Exchange of the US.

1. NYSE – The New York Stock Exchange

New York is the oldest stock exchange. Starting from 1792 in this stock exchange oldest companies of the US are listed.

1. Johnson & Johnson
2. AT & T INC
3. Visa Inc.
4. ExxonMobil Corporation
5. Bank Of America Corp.
6. Wal-Mart Stores Inc
7. Wells Fargo & Co.
8. Alibaba Group Holding Ltd.
9. Procter & Gamble Co.
10. Berkshire Hathway

2. NASDAQ – National Association Of Securities Dealers Automated Quotations.

NASDAQ is from 1971, and this is the oldest and first Electronic Trade Stock Exchange. Very popular companies are listed on NASDAQ.

1. Alphabet (google)
2. Tesla
3. Microsoft
4. Apple
5. Amazon
6. Netflix
7. Nvidia
8. Intel
9. Facebook
10. Zoom

US Stock Market Indices

In India, we know Nifty 50 & BSE Sensex are the most used Index like this in the US there are four major indexes.

1 Dow Jones Industrial Average (DJIA) –

This index is also known as Dow 30, The Dow Jones, and The Dow. In the Dow Jonas Industrial Average stock index, you can find the 30 stocks list as well as blue chip companies registered. The DJIA is a price-weighted index that means whose value is more, than the company is listed on top of the side.

Microsoft Corp., Coca-Cola Co., and McDonald’s Corp. are some blue chip companies listed on DJIA.

Also Read What Stocks in Dow Jones Industrial Average


2 Standard & Poor 500 (S&P 500)

S&P 500 includes the 500 largest US publicly traded companies, the first rule is to get listed on S&P 500 is that, the company should be headquartered in America, and second is the market capitalization of the company should be 12.7 billion or more, only that company will get listed on S&P 500 Index.

3 NASDAQ Composite

Don’t get confused between NASDAQ Composite and NASDAQ. NASDAQ Composite is a Stock Index and NASDAQ is a Stock Exchange

NASDAQ Composite includes 2500 companies and most of the companies are Information Technology Companies. Nasdaq Composite is Capital weighted index that means whose market value is more than the companies will be listed on NASDAQ Composite.

4 Russell 2000

Russell 2000 includes 2000 small-cap companies.

These are the main four Stock Index of the US Stock Market, other than that there are more stock indexes in the US Stock Market.

So These are some basic things to know before investing in US Stock Market. Now we will understand How to Start Investing in US Stock Market.

How to Start Investing in US Stock Market

1. Direct Investment in US Stock Market

In this option, you can open an ‘Overseas Trading Account’ from an Indian broker. Indian brokers are already tied up with the US broker. And in another option, you can directly open an Overseas Trading Account with a US broker who can avail of their service in India.

These are some list of brokers with the help of them you can open your Overseas Trading Account and start Investing in US Stock.

  1. ICICI Direct
  2. HDFC Securities
  3. Kotak Securities
  4. Grow
  5. INDMoney
  6. Vested

2. Indirect Investment – Mutual Fund

In this option you don’t have to open any brokerage account you can directly invest in Mutual Fund. For example, you can invest in Nippon India US Equity Opportunities Fund, The ICICI Prudential, US Blue-chip Equity Fund, and the Franklin India Feeder Franklin US Opportunities Fund.

3. Exchange Traded Fund (ETF)

ETF is like a Mutual Fund type Fund in this also you can buy a group of shares but with minimum charges compare to Mutual Fund.

Taxes For Investing In US Stock Market

While investing in US Stock Market there are some limitations on investing for Indians and there are some taxes to pay to the Indian government, some taxes are payable to the US government, so let’s find out what those taxes are.

1. How much Indians can invest in US Stock Market?

First, we will understand how much Indians can invest in US Stock Market, So Indians can invest US$250000 which means in rupees Indians can invest Rs.1.9 crore in one year as per the rule of the Indian government.

2. TCS – Tax Collected Source

If Indians invest in US Stock Market then they have to pay TCS (Tax Collected Source). In one transaction if the investment amount is more than seven lakhs then 5% TCS will be applicable. And that 5% TCS amount you can avail benefits at the time of Income Tax payment.

3. Dividend

In the US you have to pay 25% tax on dividends and you can avail the benefit of tax on dividends in India while paying Income Tax that could be possible because of the “Double Tax Avoidance Agreement” because of that agreement you do not have to pay tax on dividend in India you can pay only in the US.

4. Capital Gain

In India you have to pay Capital Gain Tax but not in the US.  If you hold stocks for more than two years that will be considered as Long Term Investment and for less than two years then it will be considered a Short Term Investment there is no Capital Gain Tax on Short Term Investments but you have to pay Capital Gain Tax on Long Term Investment.


Things to be noted down while Investing in US Stock Market

1. Broker Charges and Exchange Rate

While choosing a broker you have to know every piece of information about the broker like how much brokerage will they charge to maintain a brokerage account. and how they are going to count brokerage. e.g. per transaction, monthly, quarterly, yearly. How can you see the market from their App/Website? Is it easy to understand for you or not? How can you see your (Invested) product history? can the product be compared with other (competitor) products? How can you see Invested product companies’ Profit and loss, sales, demand and supply, and expert analysis all this information is easy to access or not? look out for all this information while choosing a broker.

one more important thing is that you have to check the exchange rate which could be different of every broker.

2. Market Risk

There is a risk when your investing in stocks, but when you invest outside India then you are at double risk because if you invest outside India, you are at risk of stocks up and down and one more risk is that dollar value increase and decrease so keep that thing also in mind.

3. Timing Of US Share Market

US Share Market open time is from 09.30 AM To 04.00 PM but if we compare the timing as per Indian time then the time is 07.00 PM To 01.30 AM.

What is Fraction Share?

The most important question is, what is Fraction Share, In India, you are allowed to buy at least one full share of the company but in the US you can buy a fraction of a share that is 1/10 or 1/5 share. e.g.  In India if you would like to buy a MRF share but the value of MRF one share is Rs.88890/- but you think that MRF Share will give you profit but you don’t want to invest that much amount on one share but in the US if you want to buy one apple share that is for $170 and here you can buy by spending $170/10 = $17 only.

So that is the different and low-risk thing if you want to invest in US Stock Market.

Another You Tube Video on US Stock Market do checkout

The Bottom Line

You Can Start your journey of US Investing by knowing all the terms about How to Start Investing in US Sto Market as soon as possible because time is money and early investment makes you future ready. 


How can I invest in US stock market?

You can invest in US Stock Market by two ways first is direct investment that is by opening “Overseas Trading Account” from broker and second is you can invest in Mutal Fund or ETF (Exchange Traded Fund).

Are US stocks taxable in India?

Yes, there are various taxes like TCS if you invest more than seven lakhs on one time trading then 5% TCS will be applicable. 25% tax on Dividend and capital gain tax also applicable on long term capital investment.

Which broker is best for US Stock in India

These are some list for opening brokerage account.
1. ICICI Direct
2. HDFC Securities
3. Kotak Securities
4. Grow
5. INDMoney
6. Vestedg brokerage account

Is it profitable to invest in US stock?

Yes, you can invest in US Stock Market after studying market and you will get double benefit if your share value increase then profit and other side if dollar value increase there also profit but as you all know share market is subject to market risk.

Can I buy Amazon Shares in India

You can buy Amazon Share in India by your “Overseas Trading Account”

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