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How Non US Citizens Can Trade US Markets

US Markets

How Non US Citizens Can Trade US Markets


Trading is one of the most lucrative professions that anyone can engage in. For starters, it offers traders and investors an opportunity of implementing their strategies with the purpose of taking advantage of market discrepancies. The market offers some of the most desirable goals people want like financial freedom and more time to do the things they want.

Two of the most lucrative stock markets in the US include the NYSE and NASDAQ. Both markets offer US traders and investors a chance of buying and selling stock for publicly traded companies. Thanks to the success and high profile trading engaged in US markets, non US citizens have been wondering how they can begin trading on either NYSE or NASDAQ.

One thing non US citizens need to know about trading in the US markets is that there are currently no regulations that stop you from trading US markets. However, there a few hoops you have to get through in order to open an account.

Here are tips to help you (non US citizen) begin trading in the US stock exchange market.


Selecting the Right Broker

Most international traders will have no problem opening up an account and trading the US markets. However, the US does have a list of countries that they do not allow to open accounts with us including countries like Somalia and Nigeria, for example, because of their risk profiles.

As a non US citizen who has never invested in the US stock exchange, finding the right stock broker can be super frustrating. For starters, you may end up selecting a broker who promises heaven only to end up scamming you. Secondly, it can be quite hard to compare which broker is worthy and who is not.

One thing you need to know is that there are rules and regulations that govern the opening of a brokerage account if you are a non US citizen. Before you open an account, it’s wise to consult with the brokerage firm. There are firms that will allow online applications while others will require paper filings. Also there are brokers who will demand for legitimate visa information and the W-8BEN form among other requirements.

To help you get started, here are a few brokers who accept non US citizen traders and investors:


Factors to Consider When Selecting a Broker

Products offered
It is important to consider the type of products offered by the broker. This should go hand in hand with geography. For example the brokerage firm may offer access to top markets like the London Stock Exchange, NYSE and NASDAQ but not Japan and China. When it comes to products, look for a broker that allows you to trade with all US stocks as well as mutual funds, forex and futures among others.

This is very important especially when it comes to your funds. One feature to check out is the platform’s security. Does it have a valid SSL certificate or not? If you want to know whether a broker’s platform is secured with SSL, check the URL. It should start with “https” and not “http.” It is also important to consider what investor protection law you are under.

What is the broker’s minimum balance? Is there a minimum fee charged for every trade? What about withdrawal fees? Does the broker charge any inactivity fee? Learning more about pricing will help you select a broker who is favorable to your budget.


Dealing with Taxes

It is important to note that trading in the US stock exchange will result in you being charged a 30% tax on dividends paid out by US brokerage firms. This rule is overseen by the IRS and the brokerage firm is required to withhold the amount. If you are currently residing in a country that has tax treaties with the US, then you will end up paying a lower tax rate. Capital gains are exempt from US tax for non residents but that does not mean you are exempt from capital gains tax in your country.

Since you are required to pay taxes for dividends accrued, then you have to apply either a Social Security Number or Tax identification number from the IRS. This will ensure that you are able to file your tax returns as well as offer the IRS a way of tracking your tax returns.

However, there are few different ways that your account can be held and that will also affect how you pay taxes and what form you will receive from the IRS. Make sure to follow with a tax specialist from your country so you know you are trading according to the law.

If you are a US resident, you are required to pay taxes on interest, dividends and capital gains.


Final Thoughts

As a non US citizen, it is important to know that today you can trade at the NASDAQ and NYSE even though you don’t reside in the US. To ensure this is possible, the first thing you ought to do is to select the right broker. Take your time while doing so in order to avoid scammers.

Next, make sure that you have a social security number or tax identification number. This will ensure that you keep trading as well as filing returns for any capital gains and dividends. Lastly, learn the best strategies to ensure your success.


  • paul

    November 8, 2017 at 5:02 pm

    Hi, i want to know if your courses and methods are suitable and applicable for others countries like Argentina. Let me explain myself better; what i want to know is if your methods are “country independent”. Thanks

  • Petro Popovichenko

    April 15, 2020 at 1:49 am

    Good day! If I`m non US resident, and citizen of Ukraine, how can I get a social security number or tax identification number? And, do I really need that?

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