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-   -   UK investing while still resident in the US (https://britishexpats.com/forum/usa-57/uk-investing-while-still-resident-us-879984/)

Sir Spangle Jul 6th 2016 12:59 pm

UK investing while still resident in the US
 
I'm new to this forum so apologies if this is an old question and I just missed the outcome in my forum search.

Post-Brexit, I'm thinking of taking advantage of the weak pound and transferring some dollars 'back home'. Reasoning: in the long term, I have somewhat vague plans to repatriate, and the coming months may be as a good a time as any to transfer money.

However, as the title suggests, my question is actually about investing. Though I may move some money in the next 6 - 9 months, I may not return for 2 - 3 years. In the meantime I'd like that money to work for me in some way, not just sit in my UK bank account (which I still have open and can receive the money).

My initial Googling is suggesting to me that investing in the FTSE while still resident abroad is not easy. Trading platforms are not too willing to entertain overseas residents, even if like me they are still a UK citizen / passport holder.

Has anyone solved this problem? Or does anyone have alternative suggestions for making UK money work for you while still resident abroad?

(PS - I don't think buying property is an option given difficulty / expense in securing a mortgage while overseas, but if I'm mistaken then please let me know)

Pulaski Jul 6th 2016 1:12 pm

Re: UK investing while still resident in the US
 
Investing in ADRs (effectively shares of foreign companies traded in New York) of British corporations is going to get you most of the exchange rate benefit and be FAR easier from a tax perspective.

Sir Spangle Jul 6th 2016 4:25 pm

Re: UK investing while still resident in the US
 
How about when I liquidate those ADRs though - will the money be reverted to USD in my US account? Or are you saying ADR sales can be kept in GBP and placed in a UK account?

I'm wondering if I'd lose near-term weak pound advantages in any future currency exchanges when/if the pound has recovered and I want to permanently move money to the UK.

Pulaski Jul 6th 2016 4:38 pm

Re: UK investing while still resident in the US
 

Originally Posted by Sir Spangle (Post 11995542)
How about when I liquidate those ADRs though - will the money be reverted to USD in my US account? Or are you saying ADR sales can be kept in GBP and placed in a UK account?

I'm wondering if I'd lose near-term weak pound advantages in any future currency exchanges when/if the pound has recovered and I want to permanently move money to the UK.

The USDRs are priced at a price that includes the exchange rate - if the pound rises and everything else stays the same, then the price of the ADR will rise by approximately the same percentage as the pound appreciates, so although selling ADRs will lead to you getting USD proceeds, the value of the USD will include an element that reflects the GBP/USD exchange rate. In other words, if the pound appreciates you will get a return on your ADRs that includes that currency appreciation, and so you will receive more USD and can therefore buy more GBP.

It isn't perfect, but you will save a lot of pain and aggro, notably unraveling the tax issues, compared to buying shares directly in London, ..... and that assumes you can find a broker willing to do that, because a non-US broker isn't going to touch a US resident investor because it would mean registering with the SEC and complying with SEC regulations. And a US broker is going to charge additional fees to buy overseas securities.

mrken30 Jul 6th 2016 4:54 pm

Re: UK investing while still resident in the US
 
You could buy something like the MSCI United Kingdom ETF or a UK ETF with another company.

Sir Spangle Jul 8th 2016 12:27 pm

Re: UK investing while still resident in the US
 
Thanks all for the input


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