Can Indians on a visa buy stocks in US?

I get this question from time to time, but I never did a post on this because there is a lot of conflicting information about who can do what with respect to the different visa types out there.

I hope to start a discussion with the information I have and then hope that people will share their experience on comments, and we can learn from each other’s experience.

Work Visas like H1B, L1A or L1B

If you have a H1B, L1B or L1A visa which allows you to work then you can definitely open a trading account and buy and sell shares in the US.

At the end of the year, when you’re filing your tax returns, you will have to include your earnings from your investing activities and pay taxes on them.

At the time of opening the account they will ask for your SSN, and you should already have that if you have been working in the US.

Tourist or Business Visa B1 / B2

As far as I know, if you have a business or a tourist visa, you can’t trade in stocks in the US. You won’t have a SSN in this case, and the brokerage won’t open your account without that. Additionally, you will not file your tax returns in the US at the end of the year, so I think that also points towards not being able to trade or buy shares.

If anyone knows differently, or has a different experience, please leave a comment.

Student Visa like F1

There are a lot of conflicting posts online about whether or not F1 visa holders can own stocks, and I am not sure about this one. Students on F1 Visa can get a SSN number, so they should be able to open an account, and the common theme in the posts I read is that F1 students can generate passive income and if that’s the case then they should be able to own stocks as well, but I didn’t read anything that answers this definitively.

In general, the advice that is often repeated is that if you’re in doubt then you better stay away from doing it as it may later impact your green card processing, and in that context it is better to play safe right now than repent later.

Reason for Difference in Moneycontrol Mutual Fund Numbers

I wrote about how the mutual fund return numbers from Moneycontrol were a bit different from those of Value Research and Morningstar yesterday, and that I wasn’t sure why that’s the case.

Invest Mutual who had helped with the post yesterday, researched some more and found that it was just because of different dates. He looked at the 1 year returns and found that and then I fiddled a little bit with moving a day back or a day forward and found that the difference of a day or two has caused this variance between the two sites.

Here is the table that shows the data.

Moneycontrol ValueResearch
1 year October 25 2011 October 28 2011
Historic NAV 12.8103 13.0741
Latest NAV 10/26/2012 15.6493 15.6493
Gain 22.16% 19.70%
MC VR
3 year October 27 2011 (Tuesday) October 26 2011(Monday)
Historic NAV 11.4648 11.8601
Latest NAV 10/26/2012 (Friday) 15.6493 15.6493
Absolute Gain 36.50% 31.95%
Annualized 10.93% 9.68%
MC VR
5 year October 25 2007 (Monday) October 26 2007 (Friday)
Historic NAV 13.893 13.7028
Latest NAV 10/26/2012 (Friday) 15.6493 15.6493
Absolute Gain 12.64% 14.21%
Annualized 2.41% 2.69%

Once again, thanks a lot to Invest Mutual for their help, this is not the first time, and I certainly recommend that you follow him on Twitter.