In this article you will solve all your doubts about how to open an account with an American brokerage house.
Whether for the profitability of your assets or simply to preserve your savings from national instability, opening an account with an American brokerage house is something that crosses the mind of many investors.
After all, with money abroad it is possible to buy directly the shares of foreign companies without much bureaucracy and without high tax rates.
In addition, the investor does not feel the dollar variation as much, since he can use the money directly from his account.
Here are some tips that we have prepared for you so that you can safely open your account with the largest U.S. brokerage houses.
Types of American Brokers
The largest U.S. brokerage firms are responsible for intermediating the purchase, sale and negotiation of mobile assets in the United States.
Just as in Brazil, in order to invest money in the American financial market, all transactions must at some point go through a U.S. brokerage firm.
You need to know that there are two types of brokerage firms in the USA:
- Direct Brokers
These brokers interact directly with their clients. In other words, they register and transmit trading orders without the help of intermediaries.
- Intermediary Brokers
In this case they intermediate the transactions between the customers and an even larger brokerage company, the customers have no contact with the brokerage company that will actually open the account.
And which brokerage company is the best for those who live in Brazil?
Yes, you can open an account in the USA even if you live in Brazil.
The best option is a direct brokerage. With it, the opening of your account is simpler, and you can talk directly to the brokerage company you chose to invest your money in, so the investments happen more quickly, clearly, and safely.
Having confidence and security in the chosen brokerage company is a crucial factor to start the process of opening your account in an American brokerage company.
Opt for the largest U.S. brokerage companies, as you will probably run fewer risks because they have been consolidated in the market for a longer time, and will give you more confidence to transfer your money.
If you want security to transfer your money, know that a Consultancy specialized in opening business in the United States can help you choose the Broker that best suits your needs.
Step by step how to open an account with an American brokerage house
1. make sure the legality of the brokerage company
To do this, you should check whether it is registered with FINRA (Financial Industry Regulatory Authority). This is the main way to check the legitimacy of the largest American brokerage houses.
You can also check with the SEC (Securities and Exchange Commission), which is the American CVM (securities commission).
2. Check if the broker allows non-residents to have an account
Not all brokers approve accounts for foreigners who live outside the USA.
3. Analyze the costs
As in Brazil, each American broker has its own fees and transaction costs. It is important to know what the brokerage fee is, if there are charges for maintenance or inactivity of the account, transfer fees, among others.
In order not to ruin the result of your investments, it is fundamental to evaluate the fees charged by the brokerage company.
However, it is also important to analyze the services that each one offers, to be able to choose the best cost/benefit ratio of the biggest American brokers
4. Opening the account directly on the website
Having already checked the first 3 steps, it is time to choose the brokerage company.
Then you just have to go to the website of the institution and fill in your personal data. This is usually very simple in the largest American brokerage houses.
How to open an account with an American brokerage house?
You need to send your scanned personal documents to the brokerage company for verification, the most common are the following:
– completed W-8BEN form (Certificate of Alien Status, for U.S. income tax withholding and reporting purposes).
This form certifies that you do not live in the US but are an investor in the country;
– proof of residence;
– copy of passport;
– income tax return;
After the broker evaluates your documents, you will receive your account number and password to start trading.
Now that you know how to open an account with a US brokerage house, you are ready to transfer your savings and start investing in the USA.
And there are some models and categories of companies for sale in the USA that show promise to start your investments.
How do I transfer the money to my account?
This is usually the most difficult phase of the process. To make the transfer, you need to perform an international exchange transaction, directly from your country to the U.S. broker’s account.
You can check with your bank if it offers this functionality.
Before you transfer the money to your account at your US broker, check how the exchange services work at your bank.
Some institutions are more digital, others still require physical delivery of signed contracts.
In addition, there will be foreign exchange costs such as shipping fees, for example. In this case, ask your manager or the foreign exchange specialists at your broker for advice.
The exchange rate for this form of transaction is usually higher than average. Your bank will charge you a fee for sending your money abroad. In addition, the amount transferred is subject to the IOF tax charged by the government.
IS THERE ANY WAY TO GET MY MONEY BACK TO MY BANK?
For you to bring back the capital invested in your US brokerage account, you will need to pay all these exchange costs again.
In this case you will also have to declare and pay income tax on the income earned in your foreign account.
Advantages of opening an account with an American brokerage house
After transferring your money to your account in an American brokerage house, you will already be able to make the most diverse operations in the American market.
Having an account in a brokerage house is one of the options that offer you the best possibility to invest in the American market.
Only through a brokerage house, for example, that the investor will be able to buy directly the stocks and bonds traded on the main American stock exchanges, such as NASDAQ and NYSE.
See how opening an account with an American brokerage house is not that complicated?
You just need to be very careful when choosing the broker and follow our step by step instructions, and everything will work out fine.
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