The S&P has returned 12% per year for the past decade.

Apple has recently soared to an all-time high of $200, boasting an 840% return within a similar timeframe.

It’s hard to ignore the US stock market when it comes to investing. You’ve probably heard about it over the news or even watched a certain movie about a wolf exploiting Wall Street.

If you’re still on the fence about whether you should invest in the US market, you’re not alone.

In this article, we’ll explore why the US market is so attractive for global investors and how to begin investing in it.

Why the US Market?

1) It is the largest economy in the world.

From 2002 to 2022, the US economy grew to $25.5 trillion, expanding at a compounded rate of 8.8% per year.

When combined, the New York Stock Exchange (NYSE) and Nasdaq is the largest global market, with a total capitalization of $50 trillion.

9 of the top 10 companies in the world belong to the United States. Having exposure to these companies will provide you with a diverse portfolio, enhancing the potential for stable returns and long-term growth.

2) The US dollar is the world’s reserve currency.

Over 50% of trades in the Forex market involve the US dollar.

In fact, the EURUSD is the most traded currency pair, contributing around 30% of the multi-trillion dollar trade in the forex market everyday.

This makes the US dollar the most liquid currency, providing investors with improved opportunities to find buyers or sellers for any stock at a given time.

Exposure to USD denominated assets will also help to fight against local inflation - we are well familiar on how much the Malaysian ringgit has depreciated in the past two decades.

3) Diversification to exponential growth sectors.

You’ve heard of the term “don’t put all of your eggs in one basket”.

If your portfolio consists of only Malaysian assets, what would happen when there is a recession or an economic downturn?

This is why diversifying across different geographical regions is crucial.

It can help you mitigate risks and volatility in your portfolio while offering access to global opportunities.

Rakuten Trade: My go-to broker to invest in the US market.

Regulated and approved by the Securities Commission (SC), Rakuten offers a wide variety of investment products.

The platform allows you to invest in MY, US, & HK stocks, plus 205 different ETFs from the US.

I’ve been using it for 5 months now, and the overall experience has been great.

Why I like Rakuten Trade

• Trade in MY, US, & HK Markets.

  Invest in Apple, Microsoft, NVIDIA, Maybank, Public Bank, and many other familiar brands (including ETFs).

• Extremely Low Fees.

  As low as RM1.00 if you’re trading with MYR, and $1.88 with USD.

• Fully Online Experience.

  Everything, from account registration to deposit and withdrawals, can be done online.

• Supports Fractional Shares.

  Rather than buying 1 whole share of Apple at ~$185, you can own a fraction from as low as 0.01 ($1.85).

• Quality Customer Service.

  Response time can be as quick as the same day or 1-2 days later.

• Relatively Simple Layout (Website).

  Less clunky compared to traditional brokerages. No complex charts or tables unless you need them.

• Instant Deposits (Online).

  Depositing cash from your bank account (<RM30,000) is instant. You’ll be able to use the money immediately to trade in the markets.

Rakuten’s Fee Structure

All trades in the Bursa market are placed in MYR.

But for HK or US trades, you have the choice to trade in MYR or HKD/USD.

The platform also allows you to maintain a Ringgit or HKD/USD cash balance at no extra charge! (Conversion rates are quite competitive too!)

Earn 1.75% pa on your idle cash, paid monthly

Any available MYR balance in your account will earn interest daily, up to 1.75% pa.

The earnings credited monthly into your account.

This is quite a pleasant feature, but I personally don’t leave any idle cash in Rakuten, since deposits below RM30,000 are instant anyway.

How does Rakuten compare to its closest competitor?

M+ Global is another locally regulated broker that offers US and Hong Kong stocks.

Though the layout is beginner friendly, they do not offer fractional shares and the fees are not as competitive to Rakuten.

It also does not allow you to hold your cash in USD or HKD. Whenever you make a trade, your MYR deposit will be converted to the foreign currency.

What I use Rakuten for

I mainly use it to gain exposure in the US market through ETFs that track the S&P, Dow Jones, or Nasdaq.

My investing strategy is very passive and I do not stock pick.

Rather than trading a single stock and timing the market, I choose to buy the entire US market instead.

The logic is simple - how sure are you that a stock you bought will still exist in the next 20-30 years?

If you acquired Apple, are you certain that this company will still be the tech giant it is today in the near future? 🤔

Notable US ETFs on Rakuten

1) Invesco QQQ Trust (QQQ)

Invests in 100 of the largest non-financial companies on the Nasdaq.

2) Vanguard Total Stock Market (VTI)

Invests in approximately 100% of the US stock market (large, mid, and small caps).

3) Vanguard S&P 500 (VOO)

Invests in stocks from the S&P, representing 500 of the largest U.S. companies.

My Verdict…

Rakuten Trade is by far the best broker out there, though they may not be the one with the lowest fees.

Sales pitch aside, the platform lacks a few key features, most notably the “market” order, which allows investors to buy a stock at the best available price.

Nevertheless, Rakuten boasts a wide variety of investable assets. I’m honestly quite surprised at the number of ETFs they offer.

I’m sold. How do I register?

Register using my referral code and you’ll receive 1,000 Rakuten Trade points!

These points can be used to lower your overall brokerage fee (each point is worth RM0.01).

Click here (or the picture below) to open an account today.

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DISCLAIMER: The information contained in this newsletter is for informational and educational purposes only. Nothing herein shall be construed to be financial, legal, or tax advice.