Can I Invest If I Live Abroad?

Can I invest if I live abroad? Many people ask that question assuming that living abroad limits their ability to invest, but in reality, expats have access to a wide range of investment opportunities across global markets.

While some challenges exist, such as tax implications, brokerage restrictions, and currency exchange risks, these hurdles can be managed with the right knowledge and strategy.

If you are looking to invest as an expat or high-net-worth individual, which is what I specialize in, you can email me (advice@adamfayed.com) or WhatsApp (+44-7393-450-837).

This includes if you are looking for a second opinion or alternative investments.

Some facts might change from the time of writing, and nothing written here is financial, legal, tax, or any other kind of individual advice, or a solicitation to invest.
 

Investing as an expat requires an understanding of local and international regulations, brokerage account accessibility, and tax obligations in both your home and host countries.

Some expats may also find their existing brokerage accounts restricted or inaccessible after relocating, while others may need to explore offshore investment options for tax efficiency.

This article will explore how to invest while living abroad, what happens to your investments if you move, and whether expats should consider international investments.

How to Invest When You Live Abroad

Investing as an expat involves several steps, from determining your eligibility to selecting the right investment platform and understanding tax implications.

Determine Your Investment Eligibility

Not all investment opportunities are available to expats due to residency and tax regulations. Some countries impose restrictions on foreign investors, while others limit access to local brokerage accounts. Before investing, consider:

• Can you legally invest in your host country? Some countries, like China and India, restrict foreigners from trading in local stock markets without special permissions. Others, like Singapore and the UK, allow expats to invest freely.
• Do you need a local or international brokerage? If your home country broker does not support expat accounts, you may need to open an international brokerage account that allows trading from different countries.
• How will your tax status impact your investments? Some countries may tax foreign-held assets or impose capital gains taxes on investments made while living abroad.

Choose the Right Investment Platform

The best investment platform depends on where you live, your investment goals, and how frequently you trade. Expats have several options:

• International Brokerages – Platforms like Interactive Brokers, Saxo Bank, and Charles Schwab International allow users to trade across multiple countries and hold multi-currency accounts.
• Local Brokerage Accounts – Some expats may prefer investing in local stock markets if their host country allows foreign investors to open accounts.
• Offshore Investment Platforms – Offshore brokers and wealth management firms provide tax-efficient investment solutions for expats looking to manage assets globally.

When choosing a platform, look for:

• Global market access – Can you trade across multiple stock exchanges?
• Multi-currency support – Does the platform allow you to hold and invest in different currencies to reduce forex risks?
• Regulatory compliance – Is the platform licensed and regulated by reputable financial authorities like the SEC (U.S.), FCA (U.K.), or MAS (Singapore)?
• Fees and costs – Consider trading fees, currency conversion charges, and withdrawal fees.

Expat Investments Options: Can I invest if I live abroad?

Expats can invest in a variety of asset classes, each offering different risk levels and returns. The most common options include:

• Stocks & ETFs: Investing in equities through global stock exchanges allows expats to participate in market growth and dividend income. ETFs provide diversified exposure to different markets.
• Mutual Funds & Bonds: Mutual funds are a good option for long-term, diversified investing, while government and corporate bonds offer fixed-income stability.
• Real Estate: Many expats invest in property for rental income or capital appreciation. Some countries have restrictions on foreign ownership, so it’s essential to research local laws.
• Offshore Investment Accounts: These are structured to provide tax-efficient, cross-border investment solutions, often used by high-net-worth expats.

Expat Taxes When Investing Abroad

Taxes are one of the most complex aspects of investing as an expat. Key tax concerns include:

• Capital Gains Tax (CGT): Some countries tax capital gains on stocks, real estate, or other investments. Expats should determine whether they are liable for CGT in both their home and host country.
• Dividend & Interest Taxation: If you invest in stocks or bonds, dividends and interest payments may be subject to withholding taxes in the country of issuance.
• Double Taxation Agreements (DTAs): Many countries have DTAs to prevent expats from being taxed twice on the same income. Expats should check if their home and host country have such an agreement.
• Offshore Tax Benefits: Some expats invest through offshore jurisdictions to take advantage of lower tax rates, but this requires careful legal and financial planning.

Currency Exchange Risks

Expats earning in one currency but investing in another are exposed to forex fluctuations, which can impact returns. To manage this risk:

• Use multi-currency investment accounts that allow you to hold funds in different currencies.
• Invest in assets denominated in strong, stable currencies (USD, EUR, CHF, etc.).
• Hedge against forex risks by using currency hedged ETFs.

What happens to my investments if I move abroad?

Moving abroad does not automatically affect your existing investments, but it can introduce new complications.

It’s essential to review how relocating impacts your investment accounts, tax liabilities, and portfolio strategy.

Before moving, consult a professional to determine whether you need to:

• File tax returns in both countries.
• Report foreign-held assets under tax transparency laws (e.g., FATCA for U.S. citizens).
• Restructure your portfolio to minimize tax exposure.

Managing Investments Across Borders

Not all investment platforms support cross-border access. Some brokers restrict account access or close accounts when a client moves to a country where they are not licensed.

To ensure continuity:

• Check if your brokerage allows expat accounts or if you need to switch to an international broker.
• Update your residency information with your broker to stay compliant with regulations.
• Consider opening a new brokerage account in your host country if investing locally is beneficial.

Currency fluctuations may also impact your investments. If your portfolio is denominated in a different currency than your expenses, fluctuations in exchange rates could affect real returns.

Holding multi-currency investment accounts or investing in assets denominated in your new local currency can reduce this risk.

Restrictions & Compliance Issues

Different countries have unique rules about foreign investors accessing their financial markets. Some potential challenges include:

• Brokerage Restrictions: US expats often face account closure or restrictions from platforms like Vanguard and Fidelity due to U.S. regulations.
• Capital Controls: Some countries limit how much foreign currency residents can transfer or invest abroad (e.g., China, India).
• Foreign Investment Rules: Some governments restrict foreign ownership of stocks, mutual funds, or real estate, requiring special investor visas or accounts.

Expats should check both their home and host country’s financial regulations before making investment decisions.

Can I buy stocks while living abroad?

Expats can generally buy stocks while living abroad, but they must choose the right brokerage, consider tax implications, and ensure compliance with local laws.

Using International Brokerages

The most reliable way to buy stocks while living abroad is through a global brokerage that allows international trading.

As mentioned before, offshore brokers, digital investment platforms, and even wealth management firms can provide tax-efficient investment solutions for expats looking to buy assets like stocks globally.

Investment Funds

If direct stock purchases are difficult or tax-inefficient, expats can invest through exchange-traded funds (ETFs) or index funds. Benefits include:

• Lower Tax Burden: Some ETFs are domiciled in tax-friendly jurisdictions, reducing withholding taxes.
• Diversified Exposure: Investing in broad market ETFs reduces single-stock risk.
• Simplified Compliance: Many ETFs are structured to be more accessible for cross-border investors.

Should I invest internationally?

Investing internationally offers diversification, access to high-growth markets, and protection against economic downturns in a single country.

Benefits of International Investing

Diversifying across different economies reduces risk and increases potential returns. Key advantages include:

• Global Diversification: Spreading investments across multiple countries reduces reliance on any single economy. If one market underperforms, gains in other regions can offset losses.
• Exposure to High-Growth Markets: Some countries, particularly in Asia and emerging markets, offer higher growth potential than developed economies.
• Currency Hedging: Holding assets in multiple currencies protects against depreciation in a single currency.
• Access to Different Sectors: Some industries, such as technology (U.S.), luxury goods (Europe), and renewable energy (Nordic countries), may offer better opportunities than domestic markets.

Risks of Investing Internationally

Despite the benefits, international investments come with challenges that need to be managed carefully:

• Currency Volatility: Exchange rate fluctuations can erode returns, especially if earnings are in a weaker currency.
• Regulatory Uncertainty: Foreign governments may impose capital controls, higher taxes, or restrictions on foreign investors.
• Political & Economic Instability: Some emerging markets experience political risks, economic crises, or unstable legal frameworks that impact investments.

Expats should assess these risks before committing funds to international investments.

Best International Investment Strategies for Expats

To maximize returns while minimizing risks, expats can follow these strategies:

• Use Multi-Currency Investment Accounts: Holding investments in USD, EUR, CHF, or SGD reduces forex risks.
• Diversify Across Stable and Emerging Markets: A balanced portfolio should include developed economies (U.S., Europe, Japan) and high-growth emerging markets (India, Southeast Asia, Latin America).
• Invest in International ETFs and Index Funds: These funds provide broad exposure without the complexity of direct stock ownership.
• Understand Tax Treaties to Minimize Tax Burdens: Investing in ETFs domiciled in tax-friendly jurisdictions (e.g., Ireland-domiciled ETFs for U.K. expats) can reduce withholding taxes.

Expats should invest internationally to reduce risk, access high-growth economies, and hedge against currency fluctuations.

A globally diversified portfolio is the best approach for long-term financial stability and growth. For more guidance, it is recommended to speak to a financial advisor.

Pained by financial indecision?

Adam is an internationally recognised author on financial matters with over 830million answer views on Quora, a widely sold book on Amazon, and a contributor on Forbes.