USA direct shares/stocks purchase from Australia

MITM on 06/07/2020 - 17:08
Last edited 06/07/2020 - 17:09

OK, so I want to get my slice of the growing American Pie, but how's it done cost effectively and efficiently ?
Could add NABtrade to my NAB account, but seems a bit clunky and who uses Big4 anyway ?
Could go through my Citibank account but they charge $75 + costs and takes days etc.
So looking around for an online broker and there aren't many avenues for Australian investors - it's like we're blacklisted and probably something to do with over the top regulations making it too difficult for brokers to set up shop here. TD Ameritrade have been and gone twice on Aussie soil.

And there only seems to be Etorro or Stake but again isn't instantaneous.

Now going back to Citibank - within Citibank Worldwide - transfers between Citi accounts anywhere in the world are (almost) instantaneous and with good FX rates according to their website.
So, is there a US Broker utilising Citigroup to accept cash deposits into the holding account for placing trades?

Interested to know a good work around or other suggestions.
Or there may be a Reddit or whirlpool forum someone can point me to.

Only looking to purchase 1 or 2 stocks and hold.

Financial

Comments

  • whooah1979 on 06/07/2020 - 17:11
    +24

    The American pie is about to get toasted any day now. It would be wise to wait for it cool down a bit.

    • MITM on 06/07/2020 - 18:35
      +18

      Risk/reward.
      Let me know which day please - meantime the Fed keeps printing and propping up big business.

      • johnwinds on 07/07/2020 - 13:59
        +5

        Funny you should say that. I posted a very similar question on Whirlpool a couple of years ago, and received the same type of derision you are receiving here (please see link here https://forums.whirlpool.net.au/thread/9kkypz89). It will be an interesting read for you, I'm sure!

        Luckily, I didn't heed the "dire warnings".

        Don't doubt your vibe :)

        • whooah1979 on 07/07/2020 - 14:17
          +1

          $250 to $1000 is good. Well done.

          TSLA will keep going up until the USFR turns off the printer.
          https://www.tradingview.com/symbols/NASDAQ-TSLA/

          • Tasmaniac on 07/07/2020 - 19:41
            +3

            @whooah1979: Tesla are still being valued as a car company. Some bulls have them at $4000 and I couldn't agree more.

            • whooah1979 on 07/07/2020 - 20:05

              @Tasmaniac: This 2001 all over again.

            • striker5950 on 08/07/2020 - 14:43
              +1

              @Tasmaniac: imagine if you got on tesla stock at the march dip, offfftt x4 stock price currently, 3 months is all it took

              • Tasmaniac on 13/07/2020 - 19:19

                @striker5950: There are a LOT of people who invested when the stock was $200 a share. It's just beyond crazy that the price ever got that low.

          • MITM on 08/07/2020 - 22:56

            @whooah1979: FED has slowed the printer already.

        • tasty-falafel on 07/07/2020 - 15:45
          +5

          Ah good old Whirlpool… Where everyone apparently earns over $300k a year and has a $2M+ net worth.

        • mshanann on 08/07/2020 - 12:27
          +3

          This was my post back in 2014 - seeking people's opinion on whether I should invest in Amazon, Salesforce, and Workday.

          I wanted to outlay 300,000 on the three stocks. It pains me everyday I view the stock prices now!

          https://forums.whirlpool.net.au/thread/3n8x78k3?p=2

          • cheng2008 on 08/07/2020 - 19:59
            +2

            @mshanann: I always wonder about the motives of Whirlpool (and other forums) posters, everything is bearish, going to crash next month, bubbles and tulips, etc. Really curious stuff.

      • Excelsior on 07/07/2020 - 14:56
        +5

        Money printer go brrrrrrrr.

      • payless69 on 08/07/2020 - 13:26
        +2

        You missed 16 March! Wait for another scandal.

    • shamid202 on 07/07/2020 - 10:30
      +11

      When i see posts like this its when i know i should sell and stay away from market.

      • whooah1979 on 07/07/2020 - 10:37
        +1

        It has only been four months since the market crashed. It will keep roasting until November 3. That would be the best time for a major correction.

        • Singu1arity on 10/07/2020 - 09:50

          Why November 3? Elections?

      • Pufff on 08/07/2020 - 09:58
        +2

        the only problem is these days governments around the world are using tax payer money to bail out and prop up failed/failing companies through qe.

        • havabeer on 08/07/2020 - 20:21

          They are no longer using taxpayer money to bail them out, or at least not current taxpayers. They are so far into the sewerage they are spending our kids, kids.

        • netjock on 08/07/2020 - 23:55

          Failed companies and real estate investments

      • diceman99 on 08/07/2020 - 10:50

        Yep time to pull take some profits off the table

      • MITM on 09/07/2020 - 14:17

        Or when the Uber Driver tells you which shares to buy.

    • Toffees on 09/07/2020 - 22:51

      The fed isn't going to let this happen soon. Dance while the music is playing!

  • follow on 06/07/2020 - 17:26
    +3

    tastyworks. best way to deposit money is using currencyfair. takes about a week to transfer money

    • MITM on 06/07/2020 - 18:30
      +2

      A week ? What planet is this happening on ?
      So they play the money market while you wait.

      • follow on 06/07/2020 - 18:44
        +1

        🤷 that's just how it is with US brokers. this is just the cheapest way.

        • MITM on 06/07/2020 - 19:04

          I understand It’s the norm but it just seems so prehistoric.
          I can understand the delay for identity confirmation opening an account. (Some brokers want you to post paperwork.)
          But instantaneous funds transfer is possible for international goods purchases.

          • plmko on 06/07/2020 - 22:23
            +1

            @MITM: Your funds aren't instant on good purchases. There is a facility behind them, merchants most certainly don't get their funds cleared on the spot.

            • MITM on 06/07/2020 - 23:05

              @plmko: Yeah, they are. Not sure if you’ve bought anything online lately but Click on CONFIRM BUY and guaranteed your money is out of your account then and there. Then you get a confirmation email saying your goods will be dispatched by the end of the day.
              Might take a month to deliver - but the transaction was instantaneous.

              • ryurazu on 07/07/2020 - 10:22

                @MITM: they are not settled instantly, that's what you mean. Also if you want to have speed you sacrifice direct ownership Contracts of Difference, if you want direct ownership look around i don't even know if there is a company that can do what your asking (due to regulation).

                Note i don't think you understand international transaction. yes fund come out of your account instantly that a debit and then there is a credit on the other side if you are using a third party (paypal) then it can be done almost instantly as they have your details on file and can verify both side of the transaction so it quite fast. Where are international stock trades are very slow for security reasons.

              • tetra on 07/07/2020 - 10:22

                @MITM: Yes, but the merchant does not get the money paid into their account instantly. They dispatch the item because the payment has been confirmed as valid by the card issuer / payment process, but it can easily take a few days for the payment to process and to actually receive the money.

          • 91rs on 07/07/2020 - 12:05

            @MITM: "I understand It’s the norm but it just seems so prehistoric."

            It's still common for people to use cheques for everyday stuff like shopping over there, so a week to transfer money OS isn't a huge surprise! It can still take a few days from bank to bank in Australia.

            • wackedupwacko on 08/07/2020 - 19:00

              @91rs: My friend just mentioned that for some of the companies he deals with and manages in the states, an "electronic wire transfer" is actually your bank printing a cheque with the right details and mailing it to the recipient bank.

              • MITM on 08/07/2020 - 22:48

                @wackedupwacko: Can't remember when I last received a cheque/check in my business - would be years now. I can't even remember where my check book is.
                But go to some cities in China with cash and they look at you as if you're from the stone age. Some shops simply can't sell you anything if you don't have a mobile.

      • mikstylo on 10/07/2020 - 09:10

        This. Something big is def coming. Banks settling books has not changed in over 100 years. Crypto is the way forward.

      • follow on 16/07/2020 - 19:36

        much quicker now. takes about a day all up.

    • marquise on 06/07/2020 - 18:36

      Does currencyfair sent the transfer in your name? Most US brokers require this.

    • MITM on 06/07/2020 - 18:55

      TW - can’t open an account from Australia !! WTF ?
      NZ -yes

      • follow on 06/07/2020 - 22:22

        you can. where are you looking at?

        • MITM on 06/07/2020 - 22:40

          Thanks TiO
          TWAUS account opened.
          Status: Processing.
          Should be able to fund through Citibank efficiently.

    • bohn on 07/07/2020 - 14:22

      fees on depositing and withdrawing from tasty?
      seems to be a bit of a rip

      • follow on 08/07/2020 - 16:25

        free if you use ACH

        • bohn on 08/07/2020 - 16:27

          isn't that mainly US banks?
          what options to aussies have to use it?

          I think even tastyworks.com.au has suggested that currencyfair was the best for aussies - but I think there is still a cost associated with that.

          • follow on 08/07/2020 - 16:38

            @bohn: yeah you're right. unfortunately $45 withdrawal fee. I guess I'll just keep money in there until $45 fee is insignificant.
            it's not clear to me if it's $45 for both methods.

            https://support.tastyworks.com/support/solutions/articles/43…

            • bohn on 08/07/2020 - 16:40

              @follow: they really need to sort out transferwise - not sure what the problem is with it.
              the fees are pretty off-putting.

              • follow on 08/07/2020 - 16:49

                @bohn: I guess you gotta charge somewhere. Schwab is looking like a decent alternative.

                • MITM on 08/07/2020 - 22:02

                  @follow: USD$25K minimum ? How do you get around that ?

                  • follow on 09/07/2020 - 09:55

                    @MITM: have 25k… people saying it's not enforced so if you have an amount around that go for it.

                    otherwise tasty is still good seeing as they only have withdrawal fee if buying stocks. no activity/maintenance or commissions.

            • bohn on 08/07/2020 - 23:30

              @MITM: transferwise is banned at tasty.

    • striker5950 on 08/07/2020 - 14:45

      what about transferwise?

  • Caped Baldy on 06/07/2020 - 17:27
    +1

    Stake have recently made changes to their fee structure so it's not as good as before.

    I think Schwab is an option but I haven't used it. There's a bit of discussion r/ausfinance

    • MITM on 06/07/2020 - 18:23

      I think Schwab want minimum US$25k deposited.

      • bohn on 06/07/2020 - 20:44
        +2

        they say 25k, it's not enforced.

    • watwatwat on 08/07/2020 - 20:31

      Schwab is awesome.

  • DrRalph on 06/07/2020 - 17:30
    +2

    IG.

    • beyondtool on 07/07/2020 - 23:17
      +1

      I’m with IG and having fun playing the US crude swings. But playing only with pocket money. The IG platform is not terribly robust and has completely crashed at least 3 times this year costing me a few trades. But it is convenient trading on a mobile in bed.

  • kingsville on 06/07/2020 - 17:32
    +2

    If you don't want a particular US stock, but just a stake in the S&P500, an easy way is to buy an index such as IVV.
    (or IJR if you want small cap).

    These make the tax implications easier to manage, since domiciled in Australia. (i think this is the term for it)

    • virhlpool on 06/07/2020 - 17:41

      Which app do you recommend to use for buying an index? I mean the one with the lowest fees, etc

      • kozb on 07/07/2020 - 12:44
        +2

        Selfwealth.

        Not an impressive UI but does the job at $9.50 per trade irrespective of the volume.

    • MITM on 06/07/2020 - 18:38

      Just have 1 or 2 stocks in mind.

      • tik tok on 08/07/2020 - 15:25

        Do you mind sharing what those 1 or 2 stocks are ?
        And what is your goal with these 2 stocks ?

        • MITM on 08/07/2020 - 22:58

          No and retirement.

  • Drakesy on 06/07/2020 - 18:02
    +2

    Oooh playing with fire on this one.
    There are many saying the american share market is over inflated right now and i'd agree.
    But then again you do get the potential buffer of the Australian dollar that may prop you up.

    Worst comes to worst the AUD collapses along with the American share market (which is highly possible).

    I'll stick with gambling on 1 thing at a time and keep forex out of it.

  • popsiee on 06/07/2020 - 18:04
    +2

    Index's should be much lower BUT never ending Fed $$$$$ making the equation very difficult to call !
    Only advice is make a quick/instant decision based solely on new arrival Trump tweets short term .

    • MITM on 06/07/2020 - 18:43

      Politics aside, the Fed isn’t going to let the economy fail. They are getting more braver each economic crisis as to how much to print.

      • Drakesy on 06/07/2020 - 18:55
        +1

        I don't see how propping up the 10 biggest companies in America is going to benefit the nation. But hey new monetary policy is here to stay. Stagflation is by no means sustainable and future generations will be left mopping up the mess unfortunately.

        Trump really has had a tumultuous 3 years with lasting effects.

        • MITM on 08/07/2020 - 23:09

          Bizarre - which 10 companies are you referring to ?

          This episode is peanuts and an Act of God.
          Take WW2 for example (not an Act of God but self inflicted). 5 years of human misery. Billions on armaments. Billions on destruction. Billions rebuilding. Billions on investing. 10 years later and it was the Happy Days of the 50's. We still enjoy the benefits today of good economic management.

          • Drakesy on 09/07/2020 - 10:27

            @MITM: Basically the 10 biggest companies on the US share market are the easiest and most stable way of sinking money into the system. With the central banks buying them its creating a zombie market which is overvalued.

            • MITM on 09/07/2020 - 14:16

              @Drakesy: Not sure that's how it works - the Fed can't buy companies, that would be interfering with the free market. But the Fed is currently lending to companies via bond issues (printing money) at very favourable rates to keep any needy companies liquid. Unfortunately that means cashed up profitable entities like Warren Buffet Berkshire Hathaway who sold all their airline holdings and are sitting on a pile of cash ready to lend to struggling companies - such as airlines - at high rates who couldn't otherwise access funds through normal channels - a credit squeeze. The Fed has prevented a squeeze which would've trickle all the way down to your credit card and home loan as per the GFC.

              • Drakesy on 09/07/2020 - 14:17

                @MITM: Sorry should have stated the central bank is doing the propping up. Naturally the fed can't interfere

      • gromit on 07/07/2020 - 13:24
        +2

        printing money is not a an infinite bucket they can splash into, eventually the impact on inflation etc outweighs the benefits and things get very ugly then. So for the time being they can do this but this cannot continue indefinitely.

        • ribze1 on 07/07/2020 - 21:50
          +3

          Worked for Zimbabwe right?

  • Bystander on 06/07/2020 - 19:52
    +1

    I haven't done this but am wondering if it's possible to open up a multicurrency bank account which will give you a US account number and routing number.

    From there open a US based brokerage account with a cheap broker

    • MITM on 06/07/2020 - 20:03

      👍🏻

  • cloudy on 06/07/2020 - 20:17
    +2

    Wait, you just want two stocks for a buy and hold, just use whatever. Even if it costs you a little more it’s not really worth the effort is it?

    If you’re trading many times a month, you’d want a platform you love and a price that’s good. But all you want is to own a business for years, just whatever gets the job done and move on with life.

    • MITM on 06/07/2020 - 22:58

      Correct, Investing not trading so minimal entry costs incl FX preferred.
      TiO’s tip above should “get the job done”
      Tastyworks (Australia) plus my Citibank for speed and economy. Now I can move on.

  • bohn on 06/07/2020 - 20:44
    +1

    you can also purchase shares in your name from Computershare in the US.
    Although going with someone like Schwab is probably easier.

    • plmko on 06/07/2020 - 22:15
      -1

      Computershare probably charge you $100 each way for brokerage.

      • bohn on 07/07/2020 - 08:26
        -2

        nah, they don't.

        • bohn on 07/07/2020 - 10:54

          Buying Coke (KO) through Computershare US - https://a.uguu.se/Uuyk2Fwfxfz8.png
          Cheaper/easier to use Schwab - but you can get direct ownership for a fairly low-cost.
          Depends also on the amount of $ you will be putting into US stocks as to whether you need direct ownership.

  • demiurge on 06/07/2020 - 22:33
    +1

    If you trade a lot, interactive brokers. Brokerage is $1 per 100 shares.

  • tinoproductions on 07/07/2020 - 08:02
    +1

    Interactive Brokers Australia all the way.

    By far the cheapest and most professional platform.
    You do have to trade once a month to make it worthwhile. If you don’t trade you will be charged the minimum which is $10 or so anyway.
    Any trading fees get taken off this minimum monthly.

    If you don’t want to take any currency risk, look at hedged SPX ETFs like IHVV.

    • bohn on 07/07/2020 - 08:26
      +1

      What I do not like about IB Australia is the US securities you hold have no protection in the event of IB running into any financial issue. Sure, it's unlikely at this stage, but who knows.

      Previously when Aussies were part of IB in the US, we had the same protection as yanks. SIPC protection, 500k in securities, 250k in cash. Now, we have nothing. Schwab gives us that protection.

      Also, IB AU doesn't allow automatic dividend reinvesting for aussies which is a shame.

      • mrvaluepack on 07/07/2020 - 09:50

        This is true for all foreign stock brokers. No protection like CHESS system we have in oz.

        • bohn on 07/07/2020 - 10:36
          +2

          I am aware, and my comment had nothing to do with that. It has to do with the insurance that brokers have to protect their clients.

          IB goes bust, US client has protection.
          IB goes bust, AU client has NO PROTECTION.
          Schwab goes bust, US client has protection.
          Schwab goes bust, AU client has protection.

          • whooah1979 on 07/07/2020 - 10:40
            -2

            @bohn: People should only invest what they are willing to lose. It shouldn’t be the government’s job to protect people’s bad investments.

            • bohn on 07/07/2020 - 10:43
              +4

              @whooah1979: Your investments might be in Microsoft or Apple, why should you lose your investment if something happened to your broker lel… rightio.

              • whooah1979 on 07/07/2020 - 10:47
                -6

                @bohn: That is the nature of speculating. People that don’t like the risk can keep their money under their mattress.

                • bohn on 07/07/2020 - 10:48
                  +1

                  @whooah1979: Or just choose a different broker that does give you protection.
                  Anyway, for most people, perhaps like yourself, it wouldn't matter.
                  Such small funds being invested - no big deal if the broker goes down.

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