Beyond Borders: How NRIs Can Build Resilient Portfolios Across Markets

Last Updated:June 06, 2025, 12:19 IST

NRIs can access global investments but must consider diversification, tax compliance, and currency risks. A well-planned strategy and professional advice are essential.

Authored by Nikhil Advani-Managing Director, International Business, LGT Wealth: Non-resident Indians (NRIs) can freely access global investment opportunities across different markets and currencies. While this has the potential for higher returns and diversification, it can come with host of complexities that require consideration and planning. As an NRI, you might be earning in one country, have family ties in another, and still maintain investments or property in India. With financial interests crossing borders, it is essential to have a well thought out investment strategy that is flexible, efficient, and future-ready.

The first step is adopting a global mindset while making an allocation plan. Many NRIs continue to keep a large portion of their wealth tied to a single market, often India. While India offers strong growth opportunities, diversifying across geographies can reduce risk and enhance returns. For example, combining Indian equities with exposure to U.S. technology companies and European dividend-paying stocks can provide both growth and stability. Different markets perform differently at various times, and diversification ensures you’re not overly dependent on one economy or currency. Equally important is the structure through which you invest. Today, NRIs have access to a wide range of vehicles like UCITS funds regulated in Europe, or India-focused AIFs at GIFT City (India’s International Financial Services Centre). These structures not only simplify global investing but also support better tax management, easier repatriation of funds, and long-term estate planning for NRIs with family members spread across the globe.

Currency is another key factor that many investors overlook. Suppose you earn in U.S. dollars but invest in Indian rupees, your returns are automatically impacted by currency movements. Therefore, holding investments in multiple currencies such as USD, INR, GBP, or EUR can help balance out this risk and provide more predictable returns.

NRIs are increasingly diversifying their investments beyond traditional real estate, gold, fixed income, and US equities. We are seeing rising interest in hedge funds, private equity, REITs, and private credit. The US has always been a preferred currency and equity market. But as we see policy uncertainty in the US, NRIs are looking at alternatives. European assets and the Euro stand out as longer-term beneficiaries as US exceptionalism fades.

Apart from diversification, NRIs must pay close attention to tax and compliance. Every country has its own tax system, and not understanding these rules can lead to penalties or missed opportunities. NRIs may be subject to tax in both India and their country of residence. Understanding the Double Tax Avoidance Agreements (DTAA) and the implications for capital gains, dividends, and inheritance tax is crucial. Fortunately, India has signed DTAAs with many countries, which, when used properly, can help NRIs avoid being taxed twice on the same income. Complying with local and Indian regulations ensures peace of mind and smoother wealth transfer in the future.

In conclusion, NRIs have a diverse range of investment avenues available to them, both in India and internationally. Careful planning, an understanding of regulatory requirements, and a focus on personal finance goals are essential for making informed investment decisions. Engaging professional advice can help NRIs effectively navigate these options and mitigate risks associated with cross-border investing. The LGT Group is well-positioned to support NRIs in their investment endeavours through a combination of personalized advisory services, global market access, risk management strategies, and estate planning assistance. By understanding the unique challenges faced by NRIs, the LGT Group can offer tailored solutions that help them achieve their financial objectives and ensure the effective management of their wealth across borders.

It is authored by Nikhil Advani-Managing Director, International Business, LGT Wealth. 

The views expressed in this article are those of the author and do not represent the stand of this publication.

Varun Yadav

Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst…Read More

Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst… Read More

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