If you are looking for big investment opportunities, think global. International stock trading isn’t out of reach. In fact, it can be beneficial to your investment portfolio to hedge your stocks through foreign currencies.

This page will help you understand how to buy international stocks to give you access to a bigger market.

Why invest in international stocks?

All investments come with a certain amount of risk. The best way to dilute this risk is to choose a number of investments that grow wealth in different ways. This will help you recover any funds you may lose due to a downturn in one sector. Opening your investment portfolio to international trade is a solid way to diversify your assets and access a wider choice of global investments. When you consider that on any given day Apple trades twice as many shares as the entire Australian stock exchange, you get an idea of just how big the international market is.

What’s the difference between Australian and international stock trading?

International trading offers you access to more stock options from big household names and emerging projects on the New York Stock Exchange (NYSE), London Stock Exchange (LSE) and Nasdaq, to name just a few. These stocks operate outside the Australian dollar and you can buy and sell online 24/7. You will need to go through a broker to buy and sell overseas stocks. 

Options for international investments

Use a stock trading platform

Online trading and sophisticated bots open up investment options and make it possible to get hands-on with purchasing your own stocks. 

Invest in an exchange-traded fund (ETF)

There are thousands of ETFs available on international markets with classes that determine the price and risk level.

Gain exposure through contracts for difference (CFDs)

Better suited to experienced traders, CFDs are there if you want to flex your market prediction skills.

How can Australians invest in international stocks?

Getting into international stocks can be done in four easy steps to begin your investing education and journey to financial freedom.

#1 Compare brokers with access to global stocks

Brokerage fees differ; you need to match your broker with how you intend to buy your stocks to make the best of exchange rate charges and commissions. Are you making one large investment or two or frequent, multiple small ones?

#2 Open an account

You can set up your account online through your bank, broker or both. There are some criteria you need to meet such as an Australian residential address and mobile phone as well as proof of age (you need to be over 18). 

#3 Fund your account

Transferring money between online accounts is easy and usually instant. Some international trade platforms have minimum trading limits.

#4 Start trading

Your account dashboard makes viewing market performance, research and monitoring stocks easy. Be selective about where you put your money. As well as shares there are ETFs and derivatives-based CFDs to choose from.

What are the risks of investing in international stocks?

There is a risk when investing in any shares, however, Investing in multiple markets provides some protection against a market that performs poorly. As well as the shares themselves, make sure you understand the terms and conditions for broker and exchange fees and payments so you don’t get caught out.

Investing in international shares is possible for Australians, offering a wider range of assets to diversify your portfolio.