| Silly question you may say! Of course | | | | to buy say 10 or 20 stocks, but maybe |
| you buy stocks via your broker or online | | | | 500 or even 1000, this volume will be |
| using your brokerage account. | | | | difficult to get and may take several |
| But ... | | | | hours or even days. |
| It's not necessarily that easy if you | | | | What can also happen then is, that your |
| want to buy foreign stocks which you | | | | order will automatically be split up |
| shouldn't really underestimate nor | | | | into several orders until the entire |
| neglect. There's a whole batch of | | | | volume ordered is purchased. This is |
| foreign stocks out there that make great | | | | what happened to one of my orders a few |
| investments but that are not available | | | | years ago. And every order is charged |
| in your country, or only with | | | | with a commission. Considering the extra |
| difficulty. | | | | charges for each order at your local |
| And that's the reason for this article. | | | | stock exchange, it might even be cheaper |
| Several of my subscribers emailed me | | | | if you buy the stocks at a foreign stock |
| saying that they were interested in a | | | | exchange where volume is much higher. |
| stock but couldn't purchase it in their | | | | And that's exactly what you also do if |
| country. Now why is that? | | | | you find a good stock that you are eager |
| If you want to buy Microsoft or Wall | | | | to get hold of, but can't buy it in your |
| Mart stocks for instance, you will not | | | | country at all! You buy your stocks at a |
| experience any problems at most stock | | | | foreign exchange which in most cases |
| exchanges let alone the USA. These two | | | | will be the country of the stocks |
| stocks alone already have a trading | | | | origin. This will also involve higher |
| volume of over 10 million + every day | | | | charges because you gonna have to do |
| on Wall Street. Even the regional stock | | | | this via 2 brokers. |
| exchanges like Chicago or San Francisco | | | | So let's take the Canadian Loblaw again. |
| etc. have a high trading volume with | | | | If I would like to buy this stock, I'm |
| Microsoft and Wall Mart. Buying and | | | | gonna have to see my broker here in |
| selling takes place within seconds. | | | | Germany who will then buy the stocks at |
| But although most foreign stocks are | | | | the stock exchange in Toronto which will |
| also found on the trading floors of New | | | | involve several extra commissions and |
| York and other international exchanges, | | | | charges. Because not only my broker will |
| there are exceptions. Like the Canadian | | | | charge a commission but the broker in |
| company Loblaw for example. You won't | | | | Canada too. So I'll end up paying 2 |
| see Loblaw stocks anywhere in Frankfurt, | | | | brokers who are involved in my |
| which is the largest stock exchange in | | | | transaction. |
| Germany. There's only a bit of volume at | | | | So that's simply how it works. My broker |
| the regional stock exchange in Berlin. | | | | will contact a broker in Canada who will |
| On average about 17 stocks per day. And | | | | then make the purchase for me. And apart |
| that's nothing! | | | | from extra charges involved it will also |
| The same is true for other big exchanges | | | | take longer before the transaction goes |
| too! You will not find every single | | | | through. |
| stock in New York, London, Frankfurt, | | | | But these extra commissions shouldn't be |
| Sydney or Hong Kong. It simply has to do | | | | overrated. If you find a great and solid |
| with supply and demand. If there's | | | | stock that you really want, then go for |
| hardly any demand for a stock in XYZ | | | | it and because if you're an investor and |
| country - for whatever reason - you | | | | not a trader, you are probably |
| won't have the necessary supply. So | | | | contemplating a long-term investment |
| either the stock is not available in | | | | anyway. And in the long run, commissions |
| your country at all, or only at very low | | | | and other charges are negligible anyway. |
| volumes. | | | | At the end of the day it's only |
| The difficulty with very low trading | | | | important which stocks you buy and not |
| volumes is, that if you don't only want | | | | the place where you buy them! |