offshore brokerage account – The International Investor

The best offshore fund supermarkets

FAQs

Update: The site now has a comparison table of offshore fund supermarkets. Read that to compare what’s available, read this article to understand why the choice is so limited.

If you prefer to search out the best funds on offer rather than just buy what’s being advertised heavily, you may be very frustrated by the limits your fund supermarket imposes on you.

Perhaps you want to invest in funds that aren’t distributed in your home country. Or you may be an expat, looking to invest in the same funds you used before, but can’t get an account at home because you’re no longer resident.

Given how easy it is to open an account with a foreign stock broker that trades multiple international markets, you may be wondering if it’s possible to do the same with funds. Are there any offshore fund supermarkets that let you buy funds from around the world?

Frankly, choices for retail investors in this area are slim. International fund supermarkets are an underdeveloped niche, probably because the number of people who have this need is relatively small, while regulation can make the idea awkward. But let’s take a look at what’s available.

How US residents can open foreign bank and brokerage accounts

FAQs

For residents of most developed countries, opening bank and stockbroking accounts abroad is not difficult. But for US residents, it can be a bit more awkward.

On the domestic side, there is little to stop you opening offshore accounts. US law only forbids you from sending money to a small number of countries: Iran, Cuba, North Korea and so on.

And you must declare your accounts and pay US taxes when required (see below for an important warning on this). But assuming you stick to these rules, the US government doesn’t care much where you put your money.

The problem arises at the foreign banks and stock brokers, many of whom refuse to deal with US clients. And responsibility for this lies with some overly broad rules implemented by the Securities and Exchange Commission (SEC) – plus the threat of new tax legislation.

How to open an offshore brokerage account in Singapore

FAQs

Many international investors have an overseas stock broking account in either Singapore or Hong Kong. This allows them to invest in Asian markets cheaply and easily, while still doing business in English with reputable firms in a sophisticated financial centre.

The simplest option for offshore accounts is Singapore and that’s what this article will focus on. However, the international stock broker guide also includes a comparison of the best Hong Kong stock brokers and one of those would also be a good choice.

The good news is that opening a non-resident Singapore stock broking account is extremely easy. Most stock brokers welcome foreign clients of all sizes. You do not need to be investing tens or hundreds of thousands of dollars – a couple of thousand will get you started.

If you are a US citizen or resident looking to open any kind of financial account anywhere outside the US, see this article on the added problems you face. However, at the moment it seems that some Singapore brokerages will still do business with you.