{"id":63380,"date":"2014-11-09T17:18:12","date_gmt":"2014-11-09T22:18:12","guid":{"rendered":"http:\/\/countingpips.com\/?p=63380"},"modified":"2014-11-09T17:18:12","modified_gmt":"2014-11-09T22:18:12","slug":"your-passport-to-profits-overseas","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2014\/11\/your-passport-to-profits-overseas\/","title":{"rendered":"Your \u2018Passport\u2019 to Profits Overseas"},"content":{"rendered":"<div id=\"inves-1125808733\" class=\"inves-below-title-posts inves-entity-placement\"><div id =\"posts_date_custom\"><div align=\"left\">November 9, 2014<\/div><hr style=\"border: none; border-bottom: 3px solid black;\">\r\n<\/div><\/div><p>By <a href=\"http:\/\/www.MoneyMorning.com.au\" target=\"_blank\"><u>MoneyMorning.com.au<\/u><\/a><\/p>\n<p>The <a href=\"http:\/\/www.moneymorning.com.au\/category\/stock-market\/stocks-and-bonds\" title=\"More on the stock market\"><strong>US stock market<\/strong><\/a> is back on track. The benchmark S&amp;P 500  Index is once again hitting record highs after jumping 8.6% in the past three  weeks. <\/p>\n<p> You may be wondering how you can make money from US stocks. <\/p>\n<p> A few weeks ago, one of my colleagues asked me exactly that  question \u2014 &lsquo;<em>How can I bet on it? I don&rsquo;t  have an international trading account.<\/em>&rsquo; <\/p>\n<p> My colleague wanted to know the easiest and cheapest way to  take a punt on the US market taking off. He&rsquo;s young and is willing to take  risks. He had some extra cash and he wanted to gamble.<\/p>\n<p> Well, the easiest and quickest way to invest in the US market is to buy Exchange Traded Funds (ETFs) on <a href=\"http:\/\/www.moneymorning.com.au\/category\/stock-market\/australian-share-market-stocks\" title=\"More on the Australian share market\">the ASX<\/a>. <\/p><div id=\"inves-3419242656\" class=\"inves-in-content inves-entity-placement\"><hr style=\"border: 1px solid #ddd;\">\r\n<div id=\"inpost_ads_header\">\r\n<p style=\"font-size:10px; float:left; color:#666;\">Free Reports:<\/p><\/div>\r\n<div id=\"inpost_ads\"> \r\n<p style=\"font-size:15px; float:left;\"><a href=\"https:\/\/goo.gl\/1ApBOV\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/investmacro.com\/wp-content\/uploads\/2018\/06\/graph_techs_PD.png\" align=\"left\" width=\"80\"  height=\"55\"\/><\/a>\r\n\t     <a href=\"https:\/\/goo.gl\/1ApBOV\"><b><u>Get Our Free Metatrader 4 Indicators<\/u><\/b><\/a> - Put Our Free MetaTrader 4 Custom Indicators on your charts when you join our Weekly Newsletter<\/p><br><br>\r\n<br>\r\n<br>\r\n<p style=\"font-size:15px; float:left;\"><a href=\"https:\/\/goo.gl\/f3RrHX\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/investmacro.com\/wp-content\/uploads\/2019\/01\/cot_pie_80.png\" align=\"left\" width=\"80\"  height=\"55\"\/><\/a>\r\n\t    <a href=\"https:\/\/goo.gl\/f3RrHX\"><b><u>Get our Weekly Commitment of Traders Reports<\/u><\/b><\/a> - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis.<\/p><br><br>\r\n<\/div>\r\n<hr style=\"border: 1px solid #ddd;\">\r\n<br><\/div>\n<p> Members of the <em>Albert  Park Investors Guild<\/em> are well and truly familiar with ETFs. The <em>Guild<\/em> has a portfolio entirely made up of ASX listed ETFs and Listed Investment Companies. <\/p>\n<p> ETFs are products that combine the features of managed funds  with that of regular shares. They typically aim to mimic the performance of a  certain market index \u2014 in this case, the S&amp;P 500 Index in the US. <\/p>\n<p> The ETF buys all the companies that are a part of the index.  In the case of the S&amp;P 500, that includes stocks like Apple and Exxon  Mobil. <\/p>\n<p> The ETF then issues units in the fund. These can be bought  and sold like regular shares on the stock exchange. The advantage to you is  that it gives you access to a broader range of <a href=\"http:\/\/www.dailyreckoning.com.au\/category\/investing\/\" title=\"More on investing\">investments<\/a> than would be  available otherwise. <\/p>\n<p> They also help manage your risk. ETFs have lower risk than  individual shares because they are diversified. They are also cheaper, more  transparent, and easier to buy and sell than traditional (unlisted) managed  funds.<\/p>\n<p> Some of the Australian ETFs that invest in the US market are <\/p>\n<ul type=\"disc\">\n<li>\n<p>The <strong>iShares Core S&amp;P 500 ETF [ASX:IVV]<\/strong> which tracks the       performance of the S&amp;P 500 Index. Management costs are 0.07% per year,       and it pays a quarterly dividend. <\/p>\n<\/li>\n<li>\n<p>The<strong> Vanguard US Total Market Shares Index       [ASX:VTS]<\/strong> provides exposure to more than 99.5% of the US stock       markets, so includes large, mid, small and micro-cap shares traded on the       NYSE and NASDAQ. It also pays dividends quarterly and has management fees       of 0.05% <\/p>\n<\/li>\n<li>\n<p>The <strong>iShares Core S&amp;P Small-Cap 600       ETF [ASX:IJR]<\/strong> holds more than 600 US shares with market caps of US$300       million to US$1.4 billion. It charges management fees of 0.14% per year. <\/p>\n<\/li>\n<li>\n<p>The <strong>iShares Core S&amp;P Mid-Cap 400       ETF [ASX:IJH]<\/strong> invests in 400 mid cap US stocks with market caps of       between $1 billion and $4.4 billion. It pays quarterly distributions and       also has management fees of 0.14%. <\/p>\n<\/li>\n<li>\n<p>The <strong>iShares Russell 2000 ETF [ASX:IRU]<\/strong> is another small cap focussed ETF. It invests in 2000 small cap US stocks       that make up the Russell 2000 Index. Management fees are 0.20%. <\/p>\n<\/li>\n<\/ul>\n<p>I recommended one of these US focussed ETFs in the <em>Albert Park Investors Guild<\/em> in August.  Thanks to the rising US market and favourable exchange rate, it&rsquo;s returned <em>Guild<\/em> members 11.3% to date. That  certainly beats the ASX&rsquo;s flat return since then.<\/p>\n<p><h2>\n    <strong>Your second option to profit from international stocks<\/strong><br \/>\n  <\/h2>\n<\/p>\n<p>\n  You could also consider opening an international trading  account. This will allow you to buy individual company shares listed overseas.  Australia simply doesn&rsquo;t have the opportunities available abroad. The ASX only  makes up 2% of the <a href=\"http:\/\/www.moneymorning.com.au\/category\/stock-market\/world-markets\" title=\"More on world markets from Money Morning\" target=\"_blank\">world&rsquo;s stock markets<\/a>. <\/p>\n<p> An international trading account also gives you access to a  much wider range of ETFs that are not on offer at home. The US has 1,375,  offering an array of investment opportunities. There are close to a hundred  ETFs listed on the ASX. <\/p>\n<p> Here are a few that you won&rsquo;t find at home: <\/p>\n<ul type=\"disc\">\n<li>\n<p><strong>Russell 1000 High Volatility ETF       (HVOL)<\/strong> \u2014 holds the 200 most       volatile US stocks.<\/p>\n<\/li>\n<li>\n<p><strong>ProShares UltraShort Gold (GLL)<\/strong> \u2014 takes a leveraged short position in gold.<\/p>\n<\/li>\n<li>\n<p><strong>Credit Suisse Global Warming ETN       (GWO)<\/strong> \u2014 invests in companies with       products or services tied to combat global warming.<\/p>\n<\/li>\n<li>\n<p><strong>Global X Lithium (LIT) <\/strong>\u2014invests in lithium mining companies and lithium       battery manufacturers.<\/p>\n<\/li>\n<\/ul>\n<p>Opening an international trading account isn&rsquo;t hard. A number  of Aussie broking firms offer international share trading. Some reputable ones  are CommSec Online Trading, Westpac Online Investing, e*Trade, and Bell Potter. <\/p>\n<p> Your current broker may even have access to international  exchanges. If you&rsquo;re not sure, call them and ask. <\/p>\n<p> All you&rsquo;ll need to do is complete some paperwork. It might  take a couple of days for you to be set up and ready to trade. <\/p>\n<p> The broker should also give you a form \u2014 a W8-BEN \u2014 that  will reduce the withholding tax on US dividends to just 15%. This tax will be  paid before you even see the dividends in your account. You might want to ask  if about how to take advantage of the Australian-US tax treaty, allowing you to  offset this tax against your Australian taxes.<\/p>\n<p> Remember to check the broker&rsquo;s fees. They&rsquo;re generally  around $60 per trade, plus you&rsquo;ll be charged currency conversion fees. These  costs are higher than trading <a href=\"http:\/\/www.dailyreckoning.com.au\/category\/australian-share-market-1\/\" title=\"More on the Australian stock market from The Daily Reckoning\" target=\"_blank\">stocks in Australia<\/a>, so be aware of them, but  don&rsquo;t let that put you off. <\/p>\n<p> Even if you don&rsquo;t wish to bet all you money on the US  market, it&rsquo;s a good to have some foreign investments in your portfolio.  Diversifying across economies and currencies and into sectors not available  locally can help boost your returns and reduce your risk. Sounds like good  investing to me. <\/p>\n<p> Regards, <\/p>\n<p><strong>Meagan Evans,<\/strong><br \/>\n  <strong>Investment Director, <em>Albert Park Investors Guild<\/em><\/strong> <\/p>\n<p><strong><a href=\"https:\/\/plus.google.com\/106516983215198267222\/about\" title=\"Join Money Morning on Google Plus -- and read about the things we can't always fit into our regular essays\"><u>Join Money Morning on Google+ <\/u><\/a><\/strong><\/p>\n<p>The post <a rel=\"nofollow\" href=\"http:\/\/www.moneymorning.com.au\/20141108\/passport-profits-overseas.html\">Your \u2018Passport\u2019 to Profits Overseas<\/a> appeared first on <a rel=\"nofollow\" href=\"http:\/\/www.moneymorning.com.au\">Stock Market News, Finance and Investments | Money Morning Australia<\/a>.<\/p>\n<div class=\"feedflare\">\n<a href=\"http:\/\/feeds.feedburner.com\/~ff\/MoneyMorningAustralia?a=pSyfD83HdQA:QjqEgAbSZsQ:yIl2AUoC8zA\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/MoneyMorningAustralia?d=yIl2AUoC8zA\" border=\"0\"><\/img><\/a> <a href=\"http:\/\/feeds.feedburner.com\/~ff\/MoneyMorningAustralia?a=pSyfD83HdQA:QjqEgAbSZsQ:V_sGLiPBpWU\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/MoneyMorningAustralia?i=pSyfD83HdQA:QjqEgAbSZsQ:V_sGLiPBpWU\" border=\"0\"><\/img><\/a> <a href=\"http:\/\/feeds.feedburner.com\/~ff\/MoneyMorningAustralia?a=pSyfD83HdQA:QjqEgAbSZsQ:gIN9vFwOqvQ\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/MoneyMorningAustralia?i=pSyfD83HdQA:QjqEgAbSZsQ:gIN9vFwOqvQ\" border=\"0\"><\/img><\/a>\n<\/div>\n<p><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~r\/MoneyMorningAustralia\/~4\/pSyfD83HdQA\" height=\"1\" width=\"1\" \/><br \/>\nBy <a href=\"http:\/\/www.MoneyMorning.com.au\" target=\"_blank\"><u>MoneyMorning.com.au<\/u><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>By MoneyMorning.com.au The US stock market is back on track. The benchmark S&amp;P 500 Index is once again hitting record highs after jumping 8.6% in the past three weeks. You may be wondering how you can make money from US stocks. A few weeks ago, one of my colleagues asked me exactly that question \u2014 [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-63380","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/63380","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=63380"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/63380\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=63380"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=63380"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=63380"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}