January 19, 2016 at 09:57

Features of working with foreign securities from the Russian Federation: how to buy a piece of Google



    Regular trading goes through a series of “gaskets”. Let's start from the very beginning and try to figure out what all this means from the point of view of the financial market and IT systems.

    So you want to buy Apple stock. They are listed on the St. Petersburg Exchange (and without the consent of the issuer), you can buy through some brokers.

    Here are some of the foreign IT players on the SPB exchange:
    • ALPHABET (this is GOOGLE)
    • APPLE
    • CISCO
    • FACEBOOK
    • INTEL
    • INTERNATIONAL BUS. MACHINES (IBM)
    • MICRON TECHNOLOGY
    • MICROSOFT
    • PAYPAL
    • QUALCOMM
    • Yahoo

    The remaining large IT companies are not traded in Russia. At all. You cannot take and buy one of them. Therefore, if you want to buy one of them, you need to have a broker from another country. And then the fun begins.

    You and google


    So, for example, you want to buy yourself a little Google. You are here in Russia, and Google is there in America:
    1. You go to your broker and ask if you can buy foreign trading papers. “Ok,” says the broker, “you can, here's the contract.” Only there is one caveat. The contract assumes that in fact the transaction is carried out by the Cyprus partner of our broker. Or an affiliate that is held in Cyprus specifically for people like you, overseas curiosity seekers.
    2. If you are smart and well-worn, then you ask: “And maybe your Cypriot partner can be withdrawn directly on the fly?” NYSE is the New York Stock Exchange, the New York Stock Exchange. Suppose the Cypriot is honest and directly answers: “No, dear, what are you! We are only a shell for contracts and do not trade on the NYSE. But we can take you to New York through another technical legal partner, and through Tokyo to another through another legal entity. Subscribe here and here. ” That is, this broker works with a bunch of legal entities, each of which provides transactions in one of the directions.
    3. The joke is that such structures are rather muddy and there are high risks of fraud investigations. And as soon as one of these structures is frozen for fraud, access to assets is cut off to you. It turns out work, as it were, through a Russian broker, but in practice - through a bunch of intermediaries:



    Therefore, a reasonable person does not do this.

    You and Google, the second series


    You scratch your head and decide not to work through this whole chain of “Russian broker”. The next logical step is to buy shares of the desired search engine through a foreign broker.



    Unfortunately, normal, adequate people do not work with Russians. Because the risks are too great. 3-5 years ago it was very convenient to work through TD Ameritrade. But two years ago, literally at the moment, they closed all accounts to the Russians without warning. And other brokers stupidly do not open accounts. A typical American won't even talk to you.

    Only one broker is ready to undertake such a feat as opening an account for a Russian - Interactive brokers. But to open an account with them, you need:
    • A lot of money (about 15 thousand dollars at least).
    • You need to show where you got this money.
    • You need to be “clean,” that is, additionally prove that you are you, and that some Bulk is not following you.

    The problem is obviously in the second and third paragraph. For this evidence, you need to collect a lot of papers. There are special companies that do this. The procedure is non-trivial and long, so here a whole market of intermediaries blooms and smells, collecting and making documents for opening accounts. Among them, there are also those who want to act as a financial adviser, but it is better to send them right away.

    Then you will be given a code card in electronic form or a physical token. You trade with them, confirming one-time transaction passwords.

    So, having completed this quest, you buy Google’s shares. But the adventure does not end there.

    Technically, your securities are held in the depository of America, and not in the Russian depository.

    You and Google, the climax


    For both schemes (through a Russian broker and through a foreign broker) you must pay taxes yourself. And file the declaration yourself before April 1. And besides net income you need to show revaluation on the difference in rates. And there are no benefits for you, unlike the owners of Russian accounts.

    And Russian brokers have benefits.

    Individual investment account - an account of an individual regulated by the federal law of December 21, 2013 No. 379-ФЗ. It can be opened from January 1, 2015 under Chapter 3 of the Federal Law of 04.22.1996 No. 39-FZ “On the Securities Market” (Article 10.3). The official goal of introducing individual investment accounts is to increase the attractiveness of investments in stock market instruments for private investors by providing tax deductions.

    Compared to a regular brokerage account from January 1, 2015, there are two types of tax deductions for an individual investment account. A taxpayer may choose only one type of deduction.

    The first type of investment deduction: the taxpayer will be able to annually receive a tax deduction for personal income tax in the amount of money contributed to the individual investment account in the tax period (subparagraph 2, paragraph 1 of article 219.1 of the Tax Code of the Russian Federation). For example, if you earned 600 thousand rubles, your tax will be 13% - 78 thousand rubles. You deposited 400 thousand into the account, drank the rest. 52 thousand rubles will be returned to you from the budget.

    The second type of investment deduction: at the end of the contract for maintaining IIA, after at least three years later, the taxpayer can receive a deduction on income tax for individuals in the amount of income received from operations on the investment account, i.e. all profits will be exempt from taxation (Subp. 3 p. 1 of article 219.1 of the Tax Code). By choosing the second type of deduction, you, for example, put 400 thousand into the account. Then in a year - another 400, and in a year - another 400. At the end of the epic (after 3 years) you were lucky, and the amount in the account amounted to 1,900,000 rubles. You have received 700,000 rubles in profit. Upon termination of the contract, the entire amount of profit on the account (700 000 rubles) will be exempted from taxation.

    To obtain a deduction, you will need to go to the tax office and fill out the paper.

    Another benefit for long-term securities ownership- This is an investment deduction in the amount of the financial result from the sale (redemption) of securities after three years of ownership. This deduction is valid for securities traded on the organized market and investment units of open-end mutual funds acquired after January 1, 2014. When selling securities with one tenure (N full years), the deduction limit = N x 3 million rubles.

    Such a deduction can be obtained once a year. It does not apply to the sale (redemption) of securities recorded on an individual investment account. Until 2007, the entire amount received from the sale of securities owned by more than three years was exempted from taxation. The new “three-year benefit” provides for a tax deduction in the amount of POSITIVE FINANCIAL RESULTS from the sale of securities owned for more than three years and acquired after January 1, 2014.

    The next problem is if you wanted to make a portfolio investment (that is, collect stocks instead of a bank deposit, rather than engage in high-frequency trading), then you will be delighted by the dripping commission for inactivity - and quite serious. For example, here .

    What are the options then?


    Here we are again approaching what we are doing. There is such a tool - ETF, which is a piece of a cluster of stocks purchased on a list. For example, Japanese bison market, IT companies, US leading companies and so on. We have achieved that 11 types of ETFs are traded on the Moscow Exchange and are deposited with the domestic national depository. That is, you cannot buy Google shares, but you can collect a portfolio of American companies through this tool.

    At the same time, you have all the preferences of Russian investors (tax benefits) and are protected from fluctuations in our hedging mechanics (no one else has this).

    Option 2 of a similar approach is to trust the mutual fund manager and buy through the proxy structure of the shares. For example, in the Technology Fund (SIF Bank) there is Amazon for 87 million rubles, CTC Media (not disclosed), Yandex NV for 230 million, Facebook, Inc. by 89 million. At the same time, only two large positions have been officially opened for them - Amazon and Facebook. Yandex and Mail are a little different than those companies that can lay claim to global portfolio diversification. MTS and STS look especially fun next to them - they certainly generally have little regard for the declared topics of the global Internet. There are a couple of options for such mutual funds (for example, with Cisco and other "soup" sets, but the questions to them are the same).

    Of course, this means management difficulties (you have to go to an agent or a management company) and operational risks, as well as a premium. But there is an affordable minimum amount of entry, comparable to ETFs, and banks are promoting their home products, so it's easy to start working with them in retail.

    Who is in the indexes?


    Here are some of the companies you can buy as part of an ETF specializing in IT. Please note that there are even “red-eyed” Red Hat:
    • ACCENTURE
    • ACTIVISION BLIZZARD
    • ADOBE SYSTEMS
    • AKAMAI TECHNOLOGIES
    • ALLIANCE DATA SYSTEMS
    • ALPHABET
    • ALPHABET
    • ALTERA
    • Amphenol
    • ANALOG DEVICES
    • ANSYS.
    • APPLE
    • APPLIED MATERIALS
    • ARROW ELECTRONICS
    • AUTODESK.
    • AUTOMATIC DATA PROCESSING
    • AVAGO TECHNOLOGIES
    • AVNET
    • BROADCOMORATION
    • CA
    • CDK GLOBAL
    • CISCO SYS
    • CITRIX SYSTEMS
    • COGNIZANT TECHNOLOGY SOLUTIONS
    • COMPUTER SCIENCES
    • CORNING
    • EBAY
    • ELECTRONIC ARTS
    • EMC
    • F5 NETWORKS
    • FACEBOOK
    • FIDELITY NATIONAL INFORMATION SERVICES
    • FIREEYE
    • Fiserv
    • FLEETCOR TECHNOLOGIES
    • FLEXTRONICS INTL
    • FLIR SYSTEMS
    • FREESCALE SEMICONDUCTOR
    • GARTNER.
    • Harris
    • HEWLETT PACKARD ENTERPRISE
    • HP
    • INTEL
    • INTERNATIONAL BUS. MACHINES
    • INTUIT.
    • JUNIPER NETWORKS
    • KLA-TENCOR
    • LAM RESEARCH
    • LINEAR TECHNOLOGY
    • LINKEDIN
    • MARVELL TECHNOLOGY GROUP
    • MASTERCARD-CLASS A
    • MAXIM INTEGRATED
    • MICROCHIP TECHNOLOGY
    • MICRON TECHNOLOGY
    • MICROSOFT
    • MOTOROLA
    • NETAPP
    • NETSUITE
    • NUANCE COM
    • NVIDIA
    • ORACLE
    • PALO ALTO NETWORKS
    • PAYCHEX
    • PAYPAL HLDGS
    • QORVO
    • QUALCOMM
    • RACKSPACE HOSTING
    • Red hat
    • SALESFORCE
    • Sandiskoration
    • SEAGATE TECHNOLOGY
    • SERVICENOW
    • SKYWORKS S COM
    • SPLUNK
    • SUNEDISON
    • SYMANTEC
    • SYNOPSYS
    • TABLEAU SOFTWARE
    • TE CONNECTIVITY
    • TERADATA DEL
    • TEXAS INSTRUMENTS
    • TOTAL SYSTEM SERVICES
    • TRIMBLE NAVIGATION
    • TWITTER
    • VANTIV
    • Verisign
    • VISA
    • VMware
    • WESTERN DIGITAL
    • WESTERN UN
    • WORKDAY U
    • Xerox
    • Xilinx
    • Yahoo
    • ZILLOW GROUP

    And links:


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