The benefits of purchasing US stocks in Singapore

Singapore has long been one of the world’s most attractive destinations for foreign investment. The city-state offers a stable and business-friendly environment and a highly educated workforce. Singapore has also become increasingly popular with international investors in recent years due to its favourable tax regime. This article will discuss the benefits of investing in US stocks from Singapore.

The benefits of purchasing US stocks in Singapore

Here is a look at the benefits of purchasing US stocks.

Diversification

One of the primary reasons to invest in US stocks from Singapore is its potential for diversification. When you purchase stocks based in the United States, you can tap into a much larger pool of companies and industries than if you only invested in Singaporean stocks. This diversification can help to mitigate risk and improve returns.

Liquidity

Another key benefit of investing in US stocks from Singapore is increased liquidity. The US stock market is the largest in the world, with a daily trading volume of over $200 billion. It means there is always a buyer for your shares, no matter what day. In contrast, the Singapore stock market is much smaller, with a daily trading volume of just $5 billion. Such differences in liquidity are unlikely to prevent retail traders from selling, but they may increase the price impact of large trades.

Tax benefits

Another advantage of investing in US stocks from Singapore is the available tax benefits. If you are a resident of Singapore, you will only be taxed on any capital gains you earn on your US investments if those gains are brought into Singapore. It means you can defer taxes on your investment income by reinvesting it in the United States. Additionally, there are no estate or inheritance taxes on US-based assets held by Singaporean residents.

Access to leading companies

When you invest in US stocks from Singapore, you gain access to some of the world’s leading companies. It is home to many of the world’s largest and most successful businesses, such as Apple, Facebook, Amazon, and Google. By investing in US stocks, you can participate in the success of these companies.

Expertise

Investing in US stocks from Singapore also gives you access to the expertise of experienced US-based investment professionals. These professionals can provide valuable insights into which stocks will likely perform well in the future, and they can also offer guidance on when to buy and sell shares.

Currency hedging

Another benefit of investing in US stocks from Singapore is that it can help you to hedge against currency fluctuations. When you invest in US dollars, you effectively hedge against the Singapore dollar, and it can protect your investment from losses if the Singapore dollar weakens against the US dollar.

Geopolitical stability

Investing in US stocks from Singapore also offers you the benefit of investing in a country with a stable political environment. The US has a long history of peaceful transitions of power and a commitment to the rule of law. It makes it an attractive destination for foreign investors looking for stability.

Economic growth

The United States is one of the world’s leading economies, and it is expected to continue to grow. This growth provides opportunities for investors to profit from rising stock prices.

How to start purchasing US stocks?

If you are based in Singapore and want to start purchasing US stocks, there are a few things that you need to do.

First, you need to open a brokerage account with a US broker. Many online brokers offer access to the US stock market. Once you have opened your account, you must fund it in US dollars. You can transfer money from your Singapore bank account into your brokerage account.

Once your account is funded, you can start buying and selling US stocks. It is important to remember that you will be subject to US taxes on any capital gains that you make on your investments.

If you are looking for a broker that offers access to the US stock market, there are a few things that you should consider. First, you should check to see if the broker offers competitive commissions. You should ensure that the broker provides good customer service. Finally, you should make sure that the broker offers a platform that is easy to use.

Conclusion

The benefits of investing in US stocks from Singapore are clear. If you are looking to diversify your portfolio and access the world’s leading companies, the United States is an ideal destination. The country also offers a stable political environment and strong economic growth prospects. Additionally, there are significant tax advantages for Singaporean investors. So if you are considering investing in foreign stocks, the United States should be at the top of your list.