In what would help India’s retail investors get a pie of the volatile but highly lucrative big tech stocks from the US, NSE has announced trading in select US tech stocks through a new derivative product – NSEIFSC Receipts.
The exchange shared the list of NSEIFSC receipts for which the trading will commence from Thursday, March 03, 2022 which includes eight US stocks – Alphabet (Google), Amazon, Tesla, Meta Platforms (Facebook), Microsoft, Apple, Netflix, and Walmart. As mentioned before, the offering will be in the form of unsponsored depository receipts.
While this still does not translate to an active trading of these lucrative US stocks like it is done for locally listed companies, it still brings India’s retail investors, much closer to actively trading in the same. There are certain startups who provide the ability to trade in US stocks, but it is the first such concerted push, that too coming in from the country’s second largest (world’s 10th largest) stock exchange.
Investors will be able to hold the depository receipts in their own demat accounts opened in GIFT City and will be entitled to receive corporate action benefits pertaining to the underlying stock.
“This initiative is a first of its kind at IFSC where Indian retail investors will be able to transact on the NSE IFSC platform under the Liberalized Remittance Scheme (LRS) limits prescribed by the Reserve Bank of India (RBI),” NSE IFSC’ circular in August had said.
As per NSE IFSC, this route makes the entire process of international investment easy and at a low cost for Indian retail investors. Investors will be provided with an option to trade in fractional quantity value when compared to the underlying shares traded in US markets making it affordable to them.