How to Invest in the German Stock Market. The German economy, Europe's largest, boasts several stock exchanges that are open to international investors looking to acquire securities in German companies. The largest is the Frankfurt Stock Exchange, but the Berlin-Bremen Exchange and the Hamburg Exchange also offer money-making opportunities.
Work with a financial adviser who has experience helping people invest in foreign stock markets. Most of the larger financial services companies have advisers on staff who specialize in overseas investing.
Create a trading account at one of the United States' major brokerages. Together with your financial adviser, determine the amount of your initial deposit to your trading account and have the money transferred into it.
Research the major German indexes. Each has its own website, available in an English-language version, on which you can track the market's gains or losses for the day, see what companies and industries are the biggest winners and losers and get a sense of general trends in German investing. To complete this step, you'll need a working knowledge of stock trading, which you can gain by reading a reputable introductory book on the subject from your local bookseller.
Choose an industry to focus your attention on. Ideally, it should be an industry with which you have some familiarity in the context of the German economy. Your industry of choice will also depend largely upon your personal risk tolerance.
Identify a company you want to invest in, review the trading history of its stocks and bonds and discuss it with your financial adviser.
Have your licensed stockbroker act on your behalf to place a buy order on the stock you specified. Don't forget that your order must be placed through a German broker licensed to buy and sell on the German stock markets, so you may experience a slight delay. This could conceivably affect the price you pay for the shares.
Use the index of the German market on which the company you invested in is listed to track the performance of your investment. Overseas investing is not recommended for day traders because the third-party process can make it difficult for you to pinpoint your expected sale price with the kind of precise accuracy day traders thrive on.
Direct any inquiries about laws regarding foreign investment in the German stock market to the Market Supervision Authority, which is the German equivalent of the Securities and Exchange Commission.
Stock investing is inherently risky. Always have an emergency fund on hand in case the market drops and you lose your capital.
- Stock investing is inherently risky. Always have an emergency fund on hand in case the market drops and you lose your capital.
- Direct any inquiries about laws regarding foreign investment in the German stock market to the Market Supervision Authority, which is the German equivalent of the Securities and Exchange Commission.