In the winter of 1995, I wired a bit more than $5,000 to a man I’d never met, in a country I’d never visited, to put it to work in a business I’d never heard of. To date, that investment has proved one of the best I’ve ever made.
The money I sent went to a stock broker in New Zealand … and I directed him to buy shares in a local company that makes dishwashers, washing machines and other whitewares. Back then, his was the only brokerage firm in all of Asia-Pacific that would take me on as a client … an American investor with a tiny grubstake and what he assured me was unique among retail investors of the day: a desire to put money to work directly in overseas stock markets.
That first account in New Zealand was just the beginning.
And it all started with just $5,000.
Despite the assumptions I hear all the time, the reality is that turning yourself into a true global investor does not require hundreds of thousands of dollars and access to special accounts reserved for the über-wealthy. All that’s required is knowledge and desire … and the smallest sum of money.
My journey overseas began with a book.
A few months before I ventured into New Zealand, I ventured into a Dallas bookstore to buy a copy of Investment Biker, Jim Rogers’ personal account of motorcycling around the globe for an entire year. Part travelogue, part investment research report, the book confirmed everything I’d grown up believing but had never thought to put into practice as an investor.
I spent my youth globetrotting with a mom who worked for the airline industry. We would randomly pop down to Guatemala for a long weekend, visit her friends in Frankfurt and London on holidays, trek across southern India or cross the Andes between Ralun, Chile and Bariloche, Argentina during the summer. Through it all I came to see the real world – not the world travelers typically see from inside a tour bus, but the world of ordinary people living ordinary lives. And over time I grew to realize one universal truth: People are people, no matter where you go in the world.
Whether in Paris, Texas, or Paris, France, we all pursue the exact same lives – food, convenience, entertainment, travel, shelter and clothing. The companies we choose to provide those goods and services are the only differences separating us.
And therein lay the epiphany that Investment Biker made so clear to me: I, too, could participate in the economies I’d seen in my global journeys by participating in the growth of the local companies serving all those local people.
So, what Jim Rogers did on a motorcycle, I set out to do with brokerage accounts – girdle the globe.
Over the last 17 years that it is exactly what I’ve done … opening accounts in Singapore, Hong Kong, southern Africa, even Egypt and the United Arab Emirates, to name a few of the destinations from which I operate today. I now own water companies and dairies, makers of tobacco and sellers of cosmetics, hotels and banks, utility companies and supermarkets. All are local companies selling to local consumers … and all trade on local stock exchanges. (Jim Rogers knows he inspired my global investment journey; I told him about it during a trip to visit him in Singapore a few years ago.)
Fact is, I tried big-name banks and brokerage firms, asking each if they would allow me to open an account. They all said no, not at the level of investment I wanted to make. If I wanted them to act on my behalf in foreign markets, I’d have to invest $50,000 to $100,000 per trade.
And that’s the expectations I still hear from individual investors today. They lump overseas investing in with “offshore banking,” and wrongly presuppose that the price to play is too expensive. Few realize just how affordable it really is to gain access to a self-directed brokerage account overseas.
Global Investing is for Everyone
There is a moral to this story and it’s this: The world of investing does not stop where Lower Manhattan meets the Hudson and East rivers. Literally a world of opportunity awaits investors.
And, as my story illustrates, the cost of taking your money offshore is minimal. You don’t need $100,000 or more to start. In fact, you don’t even need the $5,000 that I started with. I know of brokerage firms in numerous countries that will open an account for you with a minimum investment of just $1.
In practical terms, $1 won’t buy you any stocks; you’ll at least have to pony up whatever it costs to make your first trade. But the point remains that you can very easily open accounts overseas without having the resources of a Rockefeller.
Of course, the next step is figuring out what stocks to own once you have a brokerage account overseas … that’s a different story altogether, and one I’m an expert in as well. It’s why I write the Emerging Market Strategist investment service, to steer investors into the stocks of foreign-listed companies – the same kind of companies that I saw in my global travels as a kid and that today are spinning out big profits for me and my readers.
Until next time, stay Sovereign …
Jeff D. Opdyke
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