International Trading

S

StockApprentice

Ok, I'm totally at a loss as to how to answer this simple question: how does a US resident open a brokerage account outside of the USA (Europe, Austrailia, etc.)?

I would, of course, like to keep costs at a minimum. I just want to be able to have 2-3 accounts and transfer money between them (or through an intermediary) when desired.

I'm not sure if I need to incorporate here in the US and then (somehow) become an international company... or maybe have two related but separate corporate structures... I'm really quite lost.

If anyone has any information or suggestions to share, especially in regard to online resources, I would greatly appreciate the input.
 
Quote from poyayan:

No. You don't. If you don't trade a lot, etrade has access to 6 global markets.
More...

I'm pretty well aware of the many United States brokers who could give me access to international exchanges... but in my situation I'm not interested in them. I actually want to hold funds off-shore.

And no this isn't a scheme to avoid taxes of any kind. I'm actually interested in learning about how to open a foreign account.. and how taxes would be treated, etc.
 
If you are doing this in small size you'll be dealing with the retail side of the brokerages/banks and they require proof off domestic residence in most countries. This is a local utility bill and lease/mortgage.

Once you get past that hurdle consider the following.

Most European countries (I have many relatives who haved moved around Europe) tell me that banking and brokerage over there is a tedious, expensive and bureaucratic process.

In some, retail stock trading is non-existent because fees and taxes to the little guy make it impossible. For example in the UK if you are not registered with the FSA (ie you are not "institutional") you get slapped with stamp duty on each and every stock trade. This is why you have CFDs in the UK. It stands for "contracts for difference" and is a derivative contract designed to get the little guy into the action.

If you are doing this as a foreign LLC or corporation i.e US LLC in Europe, you will need to spend real money getting local legal and tax advice. Do not do it by getting comments off a message board.

If the idea is to trade stocks not listed in the US but oversees, it is of course possible. US mutual funds and hedge funds do it mostly through the big boys (Goldman Citigroup Merrill and their foreign relationships). It's a big boy game though. Not for the shrimp.

As for taxes, be prapered for a night-mare. Again talk to an internation tax/law firm. You'll likely run far away and consider an E-trade account.
 
KGI in Hong Kong and Phillip in Singapore seem to have the widest range of countries available after US brokers like IB. Can open an account without being resident in either country.

UK brokers are idiots who can require things like a "letter of reccomendation from your bank" (like we were in the last century and still wearing top hats and whiskers or something) or proof of salary from a corporation (so how do you trade for a living?). Mainland European brokers are probably worse. HSBC in Channel Islands seems to offer wide range of markets - investing rather than trading fees and service levels.

If a US broker fits your needs, stick with a US broker. Unless you are an institution or a member of one of Europes elite families levels of service are generally very very poor outside of US e.g I have had to go to Director level to get accounts opened in a reasonable timeframe.
 
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