Who hasn't heard of Google, one of the most thriving technology companies? The good news is that you can now also own a portion of Google.
By purchasing Google shares on the US stock exchange, we take control of the company. How to? Here is a beginner's guide to purchasing Google shares on foreign exchanges:
1. Find a trusted American stock broker
We must open an account with an offshore securities operating service on a US exchange because Google shares are traded in the United States.
Some of the names of overseas brokerages serving the US market are:
How do I determine the legality of an overseas broker?
This is an example of how to check legality for the US market. There are two ways, namely:
- member of FINRA (Financial Industry Regulatory Authority, Inc.). This is the agency that regulates the financial industry in the USA, and all brokers operating in the USA are required to be members of FINRA
- SIPC (Securities Investor Protection). This is an investor protection agency, and all brokers operating in the USA are required to be SIPC members.
It's quite easy to check if the broker already has these two memberships.
First, the relevant broker will certify that they are members of FINRA and SIPC. This statement is usually listed at the very bottom of the site's first page.
Second, we ourselves can check directly on the FINRA and SIPC sites to ensure the legality of the foreign broker whom we want to use.
2. Open an Account at a Broker
After choosing a broker, the next step is to open an account with the broker and carry out the KYC (Know Your Customer) process.
We have to open an account with a foreign broker to be able to buy Google shares.
The following KYC account opening process:
- Fill in the account opening form, answer and confirm a number of questions, and upload identity documents.
- Waiting for data verification by the broker
- Deposit money into the account according to the provisions.
Data entry for KYC consists of several steps:
- Personal data: name, address, contact and others.
- Experience, trading knowledge, and an investment plan
- Risk profile: how much is the investment plan and are you ready to accept losses? sources of investment: salary, inheritance, income, and others.
- Does anyone work for the stock exchange or a public company? Then information on the line of business and current job, current income, total assets, and cash owned
- NPWP must be filled in.
After filling in all the data, the next step is to upload the document.
The required documents are generally
- identity documents. What is generally accepted is a passport. However, there are brokers who, to simplify the verification process, accept ID cards as identity documents.
- Documents showing a residential address, i.e. bank bills or utility bills such as electricity, water, or telephone, with a delivery period of less than 6 months The invoice that is uploaded must show a clear name and address. If you do not have the billing document, the customer can use a SIM as proof of address, as long as the address on the SIM is the current domicile address.
3. What is the Minimum Investment in Google Shares?
To be able to start trading Google stocks, we need to know about the minimum deposit when opening an account with an overseas broker.
Maybe many of us think that the minimum deposit at an offshore broker will be large.
The reality, at all, is not great.
In fact, Tiger Securities and GoTrader do not ask for a minimum deposit when opening an account. They just ask investors to deposit money when they buy shares.
So, the idea that opening an account with an international broker is expensive is not true at all.
After the account has been opened, we can make a deposit to the broker's account that has been determined.
For example, brokers operating in Singapore, such as Tiger Securities and Phillip Securities, will open and place customer accounts in trust accounts, which are managed by banks, such as DBS and UOB.
The deposit method is done in foreign currency. It is usually in US or Singapore dollars.
Indeed, foreign exchange transfers abroad, in general, require transfer fees that are not cheap. The cost of foreign exchange transfers from BCA to overseas is around $25.
However, now, with the advancement of fintech technology, these foreign exchange transfer fees can be saved by making the following choices:
- Transfer from the DBS Digibank application, which offers a free foreign exchange transfer program.
- Transfer from the Transferwise application, which allows us to open a forex account online and transfer to a brokerage account at a lower fee.
4. Learn the Google Stock Code on the Exchange
You have opened an account and have made a deposit. Now is the time for us to trade, buying and selling shares.
But before that, we have to study the code of Google shares that we will buy on the exchange. By knowing the stock code, we can do the analysis and finally buy the stock.
5. Stock Analysis
Brokers provide comprehensive information to analyze the performance of a company, such as Google. The data is up-to-date and free for customers at the broker.
Take advantage of this financial data to perform a complete and detailed analysis of a company before buying its shares.
So, before buying, we should do an analysis first.
6. Google Stock Buy Order
Make sure that the money that has been deposited is sufficient for us to purchase target shares according to the number of shares we want.
What is the minimum number of shares that we must order at the time of purchase?
- The minimum stock width that we can order on Nasdaq or NYSE USA is 1 share. That's right, 1 share is enough.
- Fractional Share Not only is 1 share, several foreign brokers provide fractional share facilities. That means we can buy shares for a fraction of the share price.
7. Monitor Google's Stock Portfolio:
To find out the number of shares and the value of Google shares that we have, we can check at any time in the portfolio in the broker application.
Later, in the portfolio, we can see what stocks we currently have and how much they are worth, as well as our profit or loss from these shares.
8. Google Stock Sell Order
What if we want to sell Google shares on the stock exchange?
Just enter the selling price and the number of shares you want to buy.
You can choose to place market orders or limit orders.
- Market Orders. The selling price follows the current market price. Orders will usually be executed immediately.
- Limit Orders The selling price is set according to our wishes, not following the market price. A new order will occur if the market price touches the price we set.
9. Withdraw Money From Sales of Google Shares to Bank Accounts
The money in the account balance can be transferred to our bank account.
The securities company provides facilities for interbank transfers from the customer's account in the securities to the customer's personal account.
The transfer will take a few days. However, if done at the same bank, the time will be faster.
What you need to pay attention to is the withdrawal fee. The numbers are quite large.
How to deal with this huge attraction fee?
- Don't often make money withdrawals into personal accounts.
- Open a personal account at the same bank as an account in securities. The cost of transferring the same between banks is cheaper or even free.
10. Stock Sale Tax Report
What about tax reporting from share buying and selling transactions abroad? The US government will immediately deduct taxes on dividend receipts if you receive dividend payments from shares in the USA. Dividend payments received by investors from USA shares are already net of tax deductions.
For other tax reporting, foreign investors are required to sign a document stating that tax reporting will be carried out in-house in their respective countries.
11. Dividend Payment
What if the Google stock that we buy pays dividends?
Dividends will be paid into the customer's account. From this account, customers can withdraw dividends to be transferred to their personal accounts.
Another option is to join a dividend reinvestment plan program, which is a facility to ask a broker to automatically invest dividend money into shares.
Conclusion
By purchasing Google shares on the US stock exchange, we take control of the company. The KYC (Know Your Customer) process will help us to ensure the broker's legality for the US market. KYC consists of several steps, including personal data, experience, trading knowledge, and risk profile.
After KYC, the next step is to upload a document that shows a clear name and address. Foreign exchange transfers abroad, in general, require transfer fees that are not cheap. However, with the advancement of fintech technology, these fees can be saved. Learn the Google Stock Code on the Exchange to study the code of Google shares that we will buy.
The minimum stock width that we can order on Nasdaq or NYSE USA is 1 share. Several foreign brokers provide fractional share facilities, which means we can buy shares for a fraction of the share price.
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