How to maximize the return on investment in overseas asset allocation

Hong Kong is an ideal first stop for "going to sea". There will be huge investment opportunities in the Hong Kong stock market in the next two or three years, mainly because China will change from an era of attracting investment to an era of capital export. There are relatively few good investment projects in the Mainland, and domestic assets are scarce. Hong Kong will be the biggest beneficiary.

Hong Kong's financial industry runs through China and the West, and its economic system is developed. Relying on Hong Kong and investing in the world is an important choice for high net worth individuals. In particular, Hong Kong insurance has the advantages of low rate, high income and wide coverage. In recent years, many mainlanders have flown to Hong Kong to buy insurance and allocate funds around the world.

But investors should not be too anxious about investing in foreign markets and overseas markets in the short term. Allocating funds abroad is a long-term strategy and a long-term directional decision. You need to make an investment plan and then implement it slowly and bit by bit.

The overseas asset allocation of nationals in developed countries is relatively common. In addition to investment, wealth management and housing and holiday needs, most of them are to avoid income tax (so most rich people open accounts in places with lower taxes and fees such as Bermuda and Virgin Islands). China has been allocating assets overseas for more than ten years. The increase of wealth, special national conditions and the increase of immigrants studying abroad have prompted Chinese people to know more about foreign countries and buy assets. For the rich, because of different national conditions and cultures, it is most important to find their own assets and allocation methods.

Generally speaking, we have summed up five ways to allocate overseas assets:

1 Buy foreign exchange directly.

Buying foreign exchange, as the saying goes, is as simple as traveling abroad to exchange foreign exchange. You can operate through any domestic bank account in mobile banking or online banking. This is the simplest and most direct way for ordinary people to allocate overseas assets. In fact, as early as the 1990s, when RMB was convertible into US dollars, many families practiced this method.

However, due to the foreign exchange restrictions caused by large-scale asset outflow, at present, a person can only exchange a quota of 50 thousand dollars a year. You can choose to have all your family members open a bank account. For example, parents don't need to manage money, and opening an account for them can also increase some savings. At present, ordinary people can only use this ant moving mode.

Open an American stock account.

Many domestic brokers can open US stock accounts, such as "xx International". However, the stock market is originally a high-risk investment. It is necessary to learn from US stocks and time difference, which further increases the risk, but it is harmless to open an account. The premise of us stocks is that there is an annual quota of 50 thousand us dollars. Please think about the next scene first.

3 Open Shanghai-Hong Kong Stock Connect or Shenzhen-Hong Kong Stock Connect to participate in overseas markets.

In the global asset allocation, the Hong Kong market is also an important piece. At present, not all Hong Kong stocks covered by Shanghai-Hong Kong Stock Connect are stocks in the Hong Kong market. If you want to participate in Hong Kong stocks more deeply, it is also a good choice to open a Hong Kong stock account in brokerage international.

Buy insurance in Hong Kong

Indeed, Hong Kong's financial industry connects the Chinese and Western markets, and its economic system is developed and perfect. Relying on Hong Kong and investing in the world is an important choice for high net worth individuals. In particular, Hong Kong insurance has the advantages of low rate, high income and wide coverage. In recent years, many mainlanders have flown to Hong Kong to buy insurance.

At the same time, the global allocation of funds, pension insurance can also avoid inheritance tax and other issues. Overseas insurance, also known as overseas annuity, will pay dividends according to the insured amount every year.

Why is it so popular to buy dividend insurance in Hong Kong? Because, you can directly swipe UnionPay cards and pay in RMB, which is not restricted by the exchange of 5w dollars. Moreover, you can directly lend money through annuity policy loans to make other large investments such as real estate purchase. However, due to foreign exchange control, the CBRC currently limits each credit card to no more than $5,000.

5 overseas purchase

In the past decade, the wealth effect brought by the rising domestic housing prices has profoundly affected the asset allocation and investment concept of Chinese people. They firmly believe that real estate is the best investment and wealth can be passed on to future generations in the form of real estate. Therefore, the most important asset in China's overseas asset allocation is the house. Therefore, the housing prices in cities where China people are concentrated, such as Vancouver, San Francisco, Melbourne, Sydney, Wellington, etc., have all been bought up by China people who go to buy houses, and many local people have to limit their purchases/loans/increase second-hand houses.

However, it should be reminded that the house is not the best overseas asset.

Due to many differences in legal environment, tax system, cultural habits, values, lifestyle and so on. There is a big gap between overseas asset allocation and investment and financial management, and many people's overseas asset allocation with domestic thinking often backfires.

In fact, many overseas countries not only collect property tax (the property tax in the United States is about 1.5%/ year), but also collect inheritance tax. Therefore, China's way of leaving a house for future generations to realize wealth inheritance is not suitable for foreign countries. Cultural differences are that foreign countries pay more attention to the cultivation of children's self-reliance/independence/personality/struggle ability, and generally realize the inheritance of wealth through insurance/trust (exemption from inheritance tax) rather than house.

Therefore, when allocating overseas assets, the rich should comprehensively consider investment income, tax and fee system, inheritance and other comprehensive factors to find a suitable allocation method.

(Information from Broadcom Investment Guan Wei)