Building Global Wealth: Why Indian Investors Need to Look Beyond Borders

For years, most Indian investors preferred keeping their money close to home — and with good reason. India’s economy has been one of the fastest-growing in the world, offering strong opportunities and attractive returns. But times are changing. Many Indian families today think globally — children studying abroad, retirement plans overseas, or buying property in another country. These goals go beyond borders. The question is: are your investments keeping up with your life plans?

Why India-Only Investing Isn’t Enough

• Currency Risk: If your future expenses are in dollars, pounds, or euros, a falling rupee can make those goals significantly more expensive.
• Concentration Risk: Depending only on Indian markets ties your wealth to one economy — and that means one set of risks.
• Missed Opportunities: Many of the world’s most innovative companies — from Microsoft to NVIDIA to Apple — lie outside India.

The shift has already begun. Overseas investments under the RBI’s Liberalized Remittance Scheme (LRS) rose 78% in 2024, reaching $8.37 billion. Clearly, Indian investors are starting to look outward.

The Case for Global Diversification

1. Smoother Returns, Lower Risk
   Global and Indian markets rarely move in sync. When one side slows down, the other often steps in to balance things out — helping your portfolio stay steadier over time. A 50:50 India–US portfolio has historically delivered stronger, more consistent returns than India-only portfolios.
2. A Natural Hedge Against the Rupee
   The rupee has depreciated around 3–4% annually against the dollar for decades. For families with overseas goals, investing globally acts as a natural hedge. For instance, a $50,000 tuition fee costing ₹42 lakhs today could cost ₹52.5 lakhs by 2035 — purely due to currency depreciation.
3. Resilience During Global Shocks
   Global exposure also builds resilience. During COVID-19, the Nasdaq bounced back in just 4 months, while the Nifty took 6. Even during the Russia–Ukraine crisis, US markets held up better as India corrected.
   
   Country Goals
   If your children plan to study abroad, or if you intend to retire or buy property overseas, your future expenses will likely be in dollars or euros — not rupees. As the rupee depreciates, every conversion means a little less global purchasing power. That’s why aligning part of your portfolio with your future currency needs is not just smart — it’s necessary.

How Much Should You Allocate Globally?

Your global allocation depends on your goals, time horizon, and comfort with volatility. Here’s a broad framework many investors find useful:

• Overseas Education (10–15 years away): 20–30% global exposure, primarily in US assets.
• Retirement Abroad (20+ years): 30–40% spread across multiple global markets.
• Foreign Property Purchase (15–20 years): 25–35% in currencies aligned with the property’s location.
• Conservative investors can begin with 5–10% allocation, and increase it gradually as comfort grows.

Easy Ways to Invest Globally

Mutual Funds / ETFs

• Motilal Oswal Nasdaq 100 ETF (US tech leaders)
• Franklin US Opportunities Fund (broad US market)
• Edelweiss US Tech FOF (focused growth)

Challenges to Be Aware Of

• RBI’s overseas investment limits currently restrict fresh flows.
• Chances of these limits reopening soon are minimal.
• Currency outflow remains a policy concern.
• Some global ETFs are trading above their iNAV, making them slightly more expensive.

Solution: Using the LRS Route

The most efficient and transparent way to invest globally is through an international brokerage account under the RBI’s Liberalized Remittance Scheme (LRS). It allows you to hold foreign ETFs and stocks directly in USD, giving you ownership and currency diversification at the same time. This route also provides more flexibility than domestic fund options tied to overseas limits.

The Bottom Line

Global investing isn’t about chasing returns — it’s about preparation. It’s about making sure your wealth keeps pace with your life’s ambitions, wherever they take you.

By going global, you:

• Protect against rupee depreciation
• Reduce portfolio volatility
• Align investments with your future currency needs

It’s time to balance India’s growth story with the world’s opportunities — and build a portfolio that truly matches your global dreams