You may have been dreaming of owning prized stocks like Berkshire Hathaway, Amazon and Alphabet (Google), but a steep price has been a deterrent. Right?
For instance, one share of Warren Buffett’s Berkshire Hathaway, which is trading at $350,620 apiece, will cost you nearly Rs 2.6 crore at an exchange rate of Rs 73 to a dollar. You will need to invest about Rs 2.4 lakh to become Jeff Bezos’s co-shareholder in retail giant Amazon, trading at $3,292 per share. And to buy a single stock of Google’s parent Alphabet ($1,893), you’ll need almost Rs 1.4 lakh.
Now, you can have fractional ownership — having less than one full share — of these high-price companies for just a dollar. The concept of fractional ownership has been prevalent in other high-value assets like racing horses, yachts and aircraft. Some US brokerages have recently started offering such ownership for shares due to tech-enabled innovation.
Globalise, a London-based investment advisory-cum-broking firm, is offering Indians the option to buy fractions of US stocks — as little as one-millionth of a scrip or whatever they could own by investing $1. For example, one could invest $1 in Berkshire and own 1/350,620 portion (given its last closing price) of the stock.
“There are no fixed fractions one must buy. You simply decide the amount of money you want to invest in a particular stock and place an order for that ‘value’,” said Vikas Nanda, co-founder, Globalise. “The order will be executed accordingly to buy fractional shares for that amount of investment. This gives a lot of flexibility, not only to be able to buy into large-value stock but also to construct portfolios since you can think in terms of ‘value of investment’ rather than ‘a number of shares’.”
Own a slice of Berkshire, Google for $1
Indian investors can use the liberalised remittance scheme (LRS) under RBI’s rules to invest up to $250,000 per person in a year. From opening an account after completing KYC compliance to starting to invest in the US market could take just a few hours, Nanda said. The brokerage is also allowing investors to invest in ETFs and American Depository Receipts (ADRs) listed on US exchanges. And the brokerage could be as little as $0.025 or nearly Rs 2 per share, fractional or a full unit. Globalise, set up by Indian-origin financial services, has an India office and is targeting at least $2-billion worth of investments from India through its platform by 2024.
There are domestic brokers too that are helping Indians invest in the US market.