NRI mainly from the US, UK and Gulf are keen on investing their earnings in NRI investment options where they can get maximum return on investment. Most of the come to India Share Market for investment but involves quite lot of risk. Here are some tips and advices for NRI share investors for doing their share trading perfect and effective.
1. Choose proper NRI Share investment basis
NRI can invest in Indian Share Market on repatriation and non repatriation basis. If the NRI wants to invest in India Stock Market on repatriation basis, he has to invest through PIS. Investment in Share Market on non-repatriation basis can be done through specific channels.
2. Stick to RBI Rules of NRI Share investment
RBI has listed a set of companies that NRIs can invest in. This list has exluded some companies that require prior permission from Foreign Investment Promotion Board. It is strictly adviced the NRI must follow such RBI rules and any malpractice will lead to penalty.
3. Do not attempt Short Term selling
NRIs are allowed only long term share investment in a company i.e., delivery based trading. They are not permitted for intraday trading or short term selling in share market. With the coming of Online Share Trading for NRIs, they will have tendency to go into short term buying and selling shares.
4. Consider Payment options for Share Purchase Funds
Payments to be made for the purchase of share can either be made through regular banking services or through NRE accounts. If the shares are of non-repatriation type, payments can be made from the NRI fund source in India NRO account.
5. Keep your Demat Account and broker well informed
Demat account and brokers play the key role in NRI investing in Indian Stock Market. In case of change of your residency i.e., from resident to NRI or NRI to resident you have to inform your demat account provider and your Stock exchange brocker to make the necessary changes in the account types.
Article authored under the title: 5 Advices for NRI Share Investors
Arun Thomas K is an engineering graduate from India who loves to write articles on India. He is interested in tourism, finance, investment and movies of India, reads so much about these topics and also loves to share it in this blog.