Hi RJB123,

May i pick your brains/experience on ETF tax optimization for "non-resident aliens"?
ie. Malaysians or Singaporians buying ETFs listed on US, London, Irish stock exchange

From my understanding of your guidance here in this thread (danke danke) + own digging (hard to find "nonUS" or "nonUK" stuff - most articles are written for US & UK investors ):
1. US listed ETFs: "Aliens" dividend withholding tax 30%, can dig back 15% but extra work & no capital tax
2. London listed ETFs: "Aliens" dividend withholding tax 15% & no capital tax

Picking your brains/experience
a. Is my above understanding correct?
b. Is Ireland & Luxemburg listed ETFs similar to (2.)?

c. I'm planning to do EU & Russia for opportunistic (ie. buy fear)
+long term Developed Market,
and have searched MSCI IK + Vanguard UK for possible candidates.
Any thoughts to share on the below?
http://finance.yahoo.com/q?s=CSX5.L&ql=1 for EU ETF opportunistic
http://finance.yahoo.com/q?s=SWDA.L&ql=0 for Developed Mkt ETF long term value averaging
http://finance.yahoo.com/q?s=CSRU.L&ql=0 for Russia ETF opportunistic

Any pointers, feedback & corrections are greatly appreciated.
"Virgin" in non-MY & non-US listed ETFs

Thank U for the pointers on EU & correction on PoV for domicile vs listes, RJB123
Yeah - was thinking of buggering all and just doing RSX only since it's opportunistic, not like 10 years+ value averaging into it
KISS

OX? ok & simple for newbies
BUT... them management / suits now banyak atas.

Any accounts less than $10K value / cash (that's USD) gets a nice little email to have at least that.. or else..
and i've been with them since 2013 + traded a heckuva lot (imagine commissions pa hitting 4 figures).

My stash/value went down coz i ported some $ to TDAA - still wanted to do OX for certain stuff since my rates were slightly better with OX for bulk trades... and they gave me the "warning letter"... ok, bye!

eh - Uni student. U really need me to "draw out colon" (literal Cantonese translation) ar?
poh poh.. ardi su te..

For those worrying (maybe just me) about IRS' estate tax on NRA's "amount >USD60K"
Bolded = my highlighting of what i think is pertinent to IRS' categorised as NRAs (non-resident aliens), like me,.

Just to share on TDAmeritrade Asia (ie. SG) response on estate taxes (ie when i die, my assets with TDAA macam mana)
"
TD Ameritrade Asia Pte. Ltd. is registered with ACRA in Singapore and our accounts are considered as domiliced in Singapore. The assets in an account will be distributed in accordance with Probate after receipt of all required information. We are however not tax professionals and hence cannot confirm if US Estate Taxes will or will not apply to any single individual. Please consult a professional tax advisor on whether US Estate Tax applies to your personal tax profile.

Any Estate Tax payable in Singapore is a matter between the Estate and the IRAS. The following link may be of some assistance with respect to IRAS Estate Tax https://www.iras.gov.sg/irashome/Other-Taxe...ty/Estate-Duty/ however, we strongly recommend that you speak with your professional tax advisor to ensure you are fully informed.
"

Compared to the response from OX (OptionsXpress) SG - it was incredibly much clearer + more "action-able".

OX just responded that they aren't tax blah blah and to consult my own tax expert blah blah
alo - in Malaysia la, i did check lar - and unless my pockets are real deep...
BTW - i did poke US' IRS too via email heheh - same kaka, they asked me to contact on of the listed tax accredited advisers blah blah..

if i had millions of USD in US ok lar tapi... more than $60K, less than worthwhile to do the above..
the feeling of being between a rock & a hard place / devil & deep blue sea

AND have to worry about it coz my sis & my investments - if i solo, ok lar my own problem... but my sis piggy back on my trades & investments..

This post has been edited by wongmunkeong: Nov 10 2016, 03:51 PM

Thank U for the alternative idea

hm.. just did a quick check - VUSD has no options on, doesn't fit my "combined arms" approach for US exchanges, although it is more tax efficient & has that non-US domiciled thing

simple concept:
1. TT charges to US brokerages is about USD20 per transaction

2. Thus, if U transfer USD500 that's 20/500 = 4% just for TT charges by US brokerage firm (excluding cost of MY bank doing TT)
VS USD5000 = 20/5000 = 0.4%
This is only the FUNDING part, excludes commissions & fees when buying/selling

3. Thus, who said doing ETFs for long term holding need >USD10K ar?
Jumping through a lot of conclusions?

FYI - TDAA takes SGD from SGD banks

er.. what has IB gotta do with TDAA SG ar?
i'm lost or U lost?

TDAA accepts SG banks' cheques in SGD.
They will convert themselves.

i was on OX
now on TOS (TDA's or TDAA's platform).

it's like comparing a remote control car (OX)
VS
drone with cam, GPS & weapons loadout (TOS)

the tools, alerts, data, backtesting, daily "classes", etc... whoa..
THOUGH it may look confusing to newbies (so many possibilities) - newbies can focus on just 2 or 3 screen items cukup heheh

Also OX management now seems to be focusing on high net worth folks - i had slightly less than USD10K coz i moved a chunk to TOS and they sent me a nice email asking me to top-up until net liq >=$10K.

So much for keeping my "first love" - for bulk contracts/stocks, it is cheaper by about 10% VS my TOS a/c but.. OX no luv me no more so.. i was forced to leave "her"..

just my PoV & practice:
1. IF just buy/hold and for asset allocation +sub-asset diversification: bought & sat on US listed stocks via iTrade

2. IF want to use sell Naked Put options to buy for (1.)
AND want to use sell Covered Call options to juice (1.) dividend+premium returns and/or sell at worthwhile price
AND want to avoid stupid agent charges on dividends by iTrade/HLeB (which is a cost on top of the 30% withholding by US IRS for non-resident aliens):
do on ToS, OX, etc (now i'm only on ToS)

2 cents sharing

This post has been edited by wongmunkeong: Nov 18 2016, 12:04 PM

Thanks bro - heheh - too used to call by platform name/short cut
forgot newbies refer to the Broker's Co. (TDA or TDAA)
ah.. there was once upon a time FB meant some else...

Ramjade yup yup TD Ameritrade (Asia la, since US mothership threw us NRAs out of US to SG)

This post has been edited by wongmunkeong: Nov 18 2016, 12:30 PM

yeah - i'd stay with local or SG brokerage houses.

however please not that the dividends U receive may be "negative" if too small due to the extra charges for "Agents fees" management/transaction. If purely/mostly for capital growth/appreciation, then "no feel on that pain"

er.. TDAA fler here who does ETFs, other stocks like CVX HCP RSX & options on ETFs & stocks.

Further feedback/sharing on the items above:
1. It depends.. but generally spot on.
2. TT fees - there are the sending local charges (if any) + US side receiving charges, usually about USD20 per transaction, regardless of amount.
5. For US - there's no capital gains tax but there is withholding tax of 30% on dividends for NRAs - non-resident aliens. Non-resident = not in US lor + aliens = not orang Trump

Bottom line - MYR10K per year & doing US ETFs?
A. heheh - IMHO, best to start with local or SGX first.
Learn value investing (whatever value is to U), Build up $ and when one can cough up >=USD5K pa to invest consistently, then it becomes more worthwhile to get into US markets.

B. Learn how to juice your US stock investments with selling options WHILE "getting there".

This post has been edited by wongmunkeong: Jan 20 2017, 08:51 AM

Risk - either to be managed or avoided
Those that avoids risk doesnt learn how to manage them
And it's due to risks that there are returns, else Fixed Deposit-style 3%pa OR worse in US & SG FD

Also, with stocks/ETFs options - do U know U can get PAID while waiting to buy a stock/ETF at a discounted price U want?
VS
pure stocks purchase = put in offer & hope/wait, repeat for months/years until filled. while waiting, no income/returns

Note - even driving is risk management ya?
blind & stupid driver following GPS only without looking at real traffic & roads = HIGH risk VS world population's driving skills
michael schumacher = relatively low risk VS world population's driving skills

please not condoning blind execution - learn, simulate, do small then have a written policy & program to execute & track (and tweak where possible for risk/returns wanted)

---
BTW - if U are planning to invest in USD denominated, think in USD denominations first, not converted MYR
Foreign Exchange fluctuates like mad within a few years - eg. $2.8 2008-2009, $3.1+ 2010-2013, 3.8+/- 2014-2016 and now 4.5
it's like trying to write in English BUT we think in Chinese/Malay/Tamil then only translate - koyak wan the written grammar
just a thought - no gospel truths

This post has been edited by wongmunkeong: Jan 20 2017, 12:08 PM

to add for local brokers:
also very bad for dividend investing IF small amount
due to additional charges per dividend received

if big enuf amount (we talking about several hundreds of net dividend) ok lar.. pain a bit VS foreign brokers

This post has been edited by wongmunkeong: Jan 20 2017, 12:37 PM

Or you guys don't ever/have not converted any of your foreign investment back to MYR? If the intention was to keep and hold the index fund etf for a long period, will this help in somewhat mitigating the effects of the forex fluctuations?

Answer = for me, yup. Keep outside MY.
for me, it's to have at least 3 different currencies' assets (er.. i'm not that rich to keep just cash in bank heheh, thus stocks/EFTs/Mutual Funds)
thus when USD zigs, MYR zags & SGD wildcard
+
also 1 country's economic woes wont impact me too much

something like asset allocation BUT location or trust (in Gov) allocation

------
I was reading up on Dreamer's thread on etf/index fund management which touched on some risk management (60/40 allocation, rebalancing strategies). Maybe in your opinion, that is not good enough/not the whole picture of index fund etf? Do enlighten me further. I'm here to learn on how to manage risk. Unless the only way to learn is to delve right into actual investing. I forgot to mention that I'm primarily eyeing index fund etf only atm. Not going for direct stock trading.

Opinion: the above is just the basics.
As U get on with it, U will notice time allocation, governmental/forex allocation, opportunistic stuff like Brazil ETF EWZ going to hell but the companies are still making $, etc. Then U will either play ostrich OR learn to tweak to capitalize on these.

------
As for selling options - slowly lar like i said, learn WHILE U setup your "base".
took me donkeys of years before i moved into options coz of availability (to local MY people) & size (of my investments/funds).
only did it coz bored ie. while waiting for value buys, nothing ado.. some cash sitting stupidly there..

As long as you're not in a rush to get rich, should be ok coz methodological + meticulous study, analysis, simulation/test, execution, tracking & managing, tweaking

just a quick share:
based on HLeB & iTrade - for ETFs, more "availability" on iTrade.
Lots of US' ARCA listed ETFs cannot be done online or must "special request" (ie old style phone in) for HLeB.

For SGX listed ETFs, no issues with HLeB.

As for sizing per order, for optimum cost per order (to get the lowest cost as a % over stock's value bought/sold),
both are about SGD (if SGX) or USD (if US) >=8K

looks huge those numbers - if U have siblings/cousins that can trust each other + want to invest, jointly invest lor
that's what i did with my sis earlier (until now) - else...

just sharing some "pains" i went through heheh