Transcript

Hi, this is Viram from Vested, and today we are going to be talking about why you should be investing in the U.S. stock market.

We at Vested strongly believe that international investing is a need rather than a choice in today’s age. And here are the top five reasons why:

Diversification standpoint

The first reason is purely from a diversification standpoint. There are four main pillars of diversification: There’s Asset-based, time-based, Industry-based, and Geography-based.The fourth pillar which is geography-based diversification is missing from the majority of our portfolios. This kind of diversification allows you to move away from single country or single currency risk.

Largest stock market in the world

Secondly, The U.S. market is the largest stock market in the world! It controls 56% of the global market cap and the NYSE and Nasdaq together are $ 42 trillion in market cap. This large market gives a lot of different optionalities in terms of investments and also provides tons of liquidity.

U.S. market has outperformed Indian market

Third, from a return standpoint, the U.S. stock market has actually outperformed the Indian stock market over the last 10 years.

Say for example, you had invested INR 10,000 in the Sensex as well as the S&P 500 10 years ago, today that INR 10,000would be worth INR 28,000 in the Sensex whereas it would be worth INR 37,000 in S&P 500.
That doesn’t seem that big a difference right? But actually, these are both different currencies.

The Sensex is in rupee whereas the S&P 500 is in dollars. Now, if you bring them both in the same currency, that 10,000 that you invested in the Sensex would actually be worth only INR 17,000 whereas the investment in the S&P 500 would stay the same.

Why? Because the rupee has actually depreciated by 63% over the last 10 years as it has moved from 45 rupees for one dollar to now close to about 72 to 73 rupees per dollar.

Access to global brands

Fourth, is access to companies that are available in the U.S. Now we all know global brands like Apple, Facebook, Google, Nike, Starbucks all of those are available on the U.S. stock markets. But along with these companies also what is available to invest in is companies that are working at the cutting edge in their field, fields that are going to grow over the next few years. Such as Artificial Intelligence, CRISPR in healthcare, cloud computing, electric vehicles. All of these sectors have amazing companies that are up and coming and are available in the U.S. public markets for one to invest in.

Fulfil your aspirational goals

Lastly, we are all aspirational. We all have global ambitions like studying abroad, living abroad or even traveling abroad. So why not save in the same currency to ensure that you don’t take any currency risk.

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Our team members at Vested may own investments in some of the aforementioned companies/assets. Different types of investments involve varying degrees of risk, and there can be no assurance that any specific investment or strategy will be suitable or profitable for an investor’s portfolio. Note that past performance is not indicative of future returns. Investing in the stock market carries risk; the value of your investment can go up, or down, returning less than your original investment. Tax laws are subject to change and may vary depending on your circumstances.

This article is meant to be informative and not to be taken as an investment advice, and may contain certain “forward-looking statements,” which may be identified by the use of such words as “believe,” “expect,” “anticipate,” “should,” “planned,” “estimated,” “potential” and other similar terms. Examples of forward-looking statements include, without limitation, estimates with respect to financial condition, market developments, and the success or lack of success of particular investments (and may include such words as “crash” or “collapse”). All are subject to various factors, including, without limitation, general and local economic conditions, changing levels of competition within certain industries and markets, changes in interest rates, changes in legislation or regulation, and other economic, competitive, governmental, regulatory and technological factors that could cause actual results to differ materially from projected results.

This video is meant to be informative and not to be taken as an investment advice and may contain certain “forward-looking statements” which may be identified by the use of such words as “believe”, “expect”, “anticipate”, “should”, “planned”, “estimated”, “potential” and other similar terms. Examples of forward-looking statements include, without limitation, estimates with respect to financial condition, market developments, and the success of or lack of success of particular investments (and may include such words as “crash” or “collapse”.) All are subject to various factors, including, without limitation, general and local economic conditions, changing levels of competition within certain industries and markets, changes in interest rates, changes in legislation or regulation, and other economic, competitive, governmental, regulatory and technological factors that could cause actual results to differ materially from projected results.