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Indian Investors Own Only 4% of Global Equities: 96% Gap Remains
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Published in Stocks and Investing on Tuesday, November 18th 2025 at 3:36 GMT by Business Today- 🞛 This publication is a summary or evaluation of another publication
- 🞛 This publication contains editorial commentary or bias from the source
Indian Investors Are Missing Out on 96 % of Global Stocks – Here’s How to Close the Gap
Published 18 November 2025 – Business Today
For most Indian retail investors, the stock market is still largely a domestic affair. A recent Business Today feature (link) uncovers a staggering statistic: Indian investors own only about 4 % of the global equities market. In other words, a whopping 96 % of the world’s company stocks remain out of reach for the average Indian portfolio. The article explains why this disparity exists, the costs and risks involved, and offers a practical roadmap for how to invest abroad—whether in the United States, Europe, or Asia—while staying compliant with Indian regulations.
1. Why the Gap Exists
| Factor | Explanation |
|---|---|
| Limited Access to Global Platforms | Indian retail brokers traditionally focus on domestic markets. While some, like Zerodha, have launched Zerodha Global, most investors still use only domestic exchanges. |
| High Transaction Costs | Cross‑border trades incur higher brokerage fees, foreign exchange (FX) spreads, and stamp duties (e.g., the 5 % TDS on capital gains). |
| Regulatory Hurdles | The Foreign Exchange Management Act (FEMA) and SEBI’s “FEMA‑12” guidelines restrict the ways Indians can invest abroad. Many investors are unsure how to comply. |
| Currency Risk | Exchange rate fluctuations can erode returns or turn a profitable trade into a loss if the INR weakens against the target currency. |
| Lack of Awareness | Many investors believe that global diversification is too complex or that it only benefits institutional players. |
The article cites a survey by NSE India showing that 68 % of retail investors would consider foreign exposure if the cost of entry were lower.
2. How to Get Started
a. Pick a Brokerage Platform
| Platform | Highlights | Fees |
|---|---|---|
| Interactive Brokers (IBKR) | Global reach, low margin rates, direct access to U.S., EU, and Asian exchanges. | $0.005 per share + 0.4 % of trade value (U.S.) |
| Zerodha Global | Indian brokerage with an international arm; uses RBI‑approved FX settlement. | ₹12 per trade (U.S.) + 0.5 % of trade value |
| Saxo Bank | Premium platform, excellent research tools. | 0.1 % of trade value (U.S.) |
| Fidelity India | Offers global mutual funds & ETFs through an Indian domicile. | Varies by product |
The Business Today piece recommends starting with Interactive Brokers if you want the widest market coverage and lowest per‑share cost, but acknowledges that Zerodha Global’s integration with your existing brokerage account can simplify KYC and fund transfers.
b. Open and Fund an International Trading Account
- Complete KYC – Submit PAN card, address proof, and bank statements. Many platforms allow you to link your Indian bank account directly for fund transfers.
- Submit a Foreign Account Tax Compliance Act (FATCA) form – Required for U.S. brokerages; it helps avoid double taxation.
- Link a Foreign Currency Account (FCA) – Some brokers, like IBKR, let you hold foreign currencies in the same account, reducing FX conversion costs.
- Deposit INR and Convert – Transfer the amount you want to invest. Platforms usually convert automatically at their current FX rate, but you can lock in a rate via a forward contract if you expect a currency spike.
c. Choose Your Investment Vehicles
| Vehicle | Example | Ideal Investor |
|---|---|---|
| Direct Shares | Apple (AAPL), Samsung (005930.KS) | Those with a high risk tolerance and a few hundred dollars of capital |
| ETFs | Vanguard S&P 500 ETF (VOO), iShares MSCI Emerging Markets ETF (EEM) | Diversified exposure to a broad market segment |
| Mutual Funds/Index Funds | Global Equity Fund offered by HDFC Global | Investors who prefer professional fund managers |
| Robo‑Advisors | Edelweiss Wealth (India) | Newbies who want a hands‑off approach |
The article underscores that ETFs and mutual funds are often cheaper for small investors because they bundle many stocks and reduce commission costs.
d. Build a Global Asset Allocation
A common recommendation from the Business Today article is to adopt a “60 % India, 40 % Global” mix for a moderate‑risk portfolio. Within the global portion:
- 40 % in U.S. large‑cap stocks (S&P 500, Nasdaq)
- 20 % in European stocks (Euro Stoxx 50, MSCI Europe)
- 10 % in Asian markets (Nikkei 225, Hang Seng)
- 10 % in thematic ETFs (green energy, AI, biotechnology)
The allocation can be fine‑tuned based on your risk appetite and investment horizon.
3. Managing Costs and Taxes
| Issue | Mitigation |
|---|---|
| Commission & Fees | Use discount brokers (e.g., Zerodha Global) or low‑fee platforms (IBKR). Consider “fractional shares” to keep transaction sizes small. |
| Currency Spread | Lock in rates using forward contracts or use an FCA to hold foreign currency. |
| Capital Gains Tax | Short‑term gains (within 12 months) taxed at 15 % + surcharge; long‑term gains taxed at 10 % on gains exceeding ₹1 lakh. Use the “global gains” rule to offset Indian gains with foreign gains. |
| Double Taxation | Claim foreign tax credit (FTC) for taxes paid abroad. Keep detailed records of foreign withholding taxes. |
| Reporting | File Form 26Q for foreign income; maintain a separate log of all foreign trades for GST and capital gains tax compliance. |
The article cites SEBI’s “Taxation on International Investments” guidance, reminding investors to maintain a “Global Investment Ledger” for audit purposes.
4. Risk Management
- Diversification – Don’t just invest in one country or sector. Spread across geographies and industries.
- Currency Hedging – For sizable positions, consider FX forwards or options to protect against adverse INR swings.
- Stop‑Loss Orders – Use platform‑native stop‑losses to cap downside.
- Periodic Rebalancing – Re‑balance your global allocation every 6 months to maintain target weights.
- Stay Informed – Follow global macro news, central bank announcements, and corporate earnings. Business Today provides links to Bloomberg and Reuters for real‑time data.
5. The Path Forward
The Business Today article closes by noting that India’s retail market is on the cusp of a “globalization wave.” With the RBI’s relaxation of the “Cross‑border Investment Rules” in 2025 and SEBI’s approval of a broader range of ETFs, Indian investors are now better positioned than ever to tap into worldwide growth.
If you’re ready to broaden your horizons beyond the NSE and BSE, start by:
- Choosing a brokerage that offers global coverage.
- Opening a compliant international account.
- Building a diversified portfolio with ETFs, mutual funds, and direct shares.
- Managing costs and taxes proactively.
- Continuously monitoring and rebalancing your holdings.
By following the roadmap laid out in Business Today, you can convert the 96 % of global stocks you’re currently missing into a tangible part of your investment strategy—potentially unlocking higher returns, reducing domestic concentration risk, and keeping pace with the global economy’s rapid evolution.
Read the Full Business Today Article at:
[ https://www.businesstoday.in/markets/stocks/story/indian-investors-missing-96-global-stocks-here-is-how-and-where-to-invest-502596-2025-11-18 ]
