HOW TO INVEST IN OFFSHORE SHARES

Australians usually invest in international shares in one of three ways: using a broker, through a managed fund or through an exchange traded fund (ETF). Most brokerage firms or online broking services can trade shares listed on major international exchanges but direct investing in individual international shares is significantly more expensive than investing in Australian shares, warns ASIC’s MoneySmart website. Costs can include brokerage, currency conversion fees, foreign security custody fees and internal transfer fees. Some managed funds focus on international shares, perhaps specific regions or industry sectors, while others simply include international shares as part of a diverse mix of assets. Fund managers may have strategies in place to limit the impact of exchange rate movements on your investment, says MoneySmart. ETFs, which are traded on the ASX, can be a cost-effective way to gain exposure to international shares. “But it’s important that you read the product disclosure statement (PDS) to know what you’re investing in and the risks involved,” says MoneySmart.