In this article, we will understand how to buy stocks internationally in Spain for interested investors.
Spain is presently one of the European Union’s most attractive and promising business markets. The country is also the European Union’s third-largest investment market. Following the pandemic/economic crisis, Spain’s legislative body rewarded the private sector with lucrative and financially beneficial rewards.
This has aided in the confidence of foreign investors and also helped them understand how to buy stocks internationally in Spain. Thanks to the legislative body’s activities, Spanish investments are now the second-largest receiver of “Inversiones extranjeras directas” – Foreign Direct Investments. These are only a handful of the elements that can help Spain attract foreign investment.
The Spanish Act 14/2013 enabled several foreign investment aspects to be realized. This law aims to aid investors who want to set up a business in Spain. The Spanish Act also aimed to establish a new labor market, and its success has helped keep the labor market afloat. The following are the main proponents for Spain’s improved economic excellence:
Economy of Spain
Spain has the least stringent international investment restrictions. In a pre-pandemic setting, Spain’s economy outperformed its European competitors last year. Other elements that encourage individuals and businesses to invest in Spain include that 70 of the world’s top 100 corporations/companies have a presence in the nation. Just about 13,000 international companies are operating successfully on the Spanish market.
- Infrastructures in Spain
Spain is a vital transportation center. In the EU, the country has the most motorways and freeways under construction. Two of Europe’s busiest airports are located in Spain. Its high-speed railway system is one of the best in the EU, and its location is on the map. Its marine interconnections to the European Union, North Africa, Latin America, and the Middle East support a thriving shipping and container port economy.
- Spain’s standard of living
Spain has the world’s longest life expectancy. This is due to its Mediterranean nutritional lifestyles and its universal healthcare system for expats and Spaniards. Spain is one of the most secure countries to live and work in. English and Spanish language lessons are also available through the country’s educational system, including public, private, and foreign schools.
- Taxation and incentives in Spain
Spain has implemented tax incentives that are similar to the EU average. For ongoing Spanish investment, the country provides subsidies and bonuses. A successful, sophisticated system of tax benefits and exemptions is in place to encourage innovation, such as RDI activities, knowledge with an industrial application for inventive advantages, and job creation.
How to Buy Stocks Internationally in Spain and Invest in Spain?
Without opening a foreign brokerage account or paying taxes, there are two simple and beneficial alternatives to invest in Spain. This is where the Spanish ETFs and ADRs come in:
The Nasdaq-100 Index is used to create the exchange-traded funds (ETFs). ETFs are used to diversify a portfolio. Investors don’t have to be concerned about concentration risks or purchasing and selling specific stocks in a portfolio. ETFs also have a small expense ratio, which might diminish long-term returns. This suggests that investors should consider investing in them because ETFs have a reduced expense ratio.
American Depositary Receipts do not need a foreign brokerage account setup, and these securities are linked to a number of different international stocks. Because ADRs are traded on a U.S. stock exchange, investors should not be bothered about international capital gains tax ramifications.
ADRs are traded on major stock exchanges such as the New York Stock Exchange. It’s worth noting that many ADRs trade far fewer shares per day than local stocks, which might make it difficult for investors to acquire or sell at reasonable prices.
People Also Read:
How to Open a Trading Account in Spain?
When setting up a trading account, there are various variables to consider, such as the platform’s user-friendliness and the required deposit amount. Let’s take a closer look at these.
An account can be opened in as little as a few minutes or as long as a few weeks. At different brokers, the final step of the process is identification verification. In most situations, the account opening process is completed entirely online, but other brokers need clients to mail a copy of their paperwork. The following documents are typically required to be uploaded and/or sent (a copy):
- Identification documents such as a national ID card, passport, or driver’s license are acceptable forms of identification.
- Bank statements, utility bills, and other forms of proof of address are acceptable.
Some brokers demand a minimum deposit to activate your trading account. The minimum deposit is typically $0 or a little sum; however, some brokers require hundreds of dollars or euros.
Best Brokers in Spain
This is a list of reputable brokers who are present in Spain and can help users on how to buy stocks internationally in Spain. It is advisable for users to go with one of the following brokers:
- Danish investment bank Saxo Bank
- DEGIRO is a discount broker based in Germany and the Netherlands.
- XTB is a global CFD broker, while eToro is a global social trading platform.
- Interactive Brokers is an international broker that offers a wide range of asset classes and helps users on how to buy stocks internationally in Spain.
Expats and non-Spanish investors are favored by Spanish legislation if their investments are up to 100 percent equity and are vetted by the Spanish government. For international investors, Spain adheres to the principles of free establishment and non-discrimination. Non-Spanish investors have the same opportunities to invest in Spain as domestic investors.
Whether you’re a first-time investor or a seasoned pro, Spain offers a variety of financial advantages to help international investors expand their portfolios. Of course, despite the fact that it may appear to be a small point, all documents presented in English must be interpreted into Spanish by a Spanish translator authorized by the Spanish government.
Is It Possible For Foreigners To Invest In Spain?
Yes, Spain welcomes everyone who wants to invest or create a permanent residency there, and Spain is a European leader in supporting foreign investment.
In order to lure international enterprises and investments, the Spanish government has reduced rules at all levels and raised benefits, and made it easy for users on how to buy stocks internationally in Spain.