Bangkok, SET recommends investing in foreign stocks through DR and DRx to create a world-class investment portfolio. Conveniently diversify your investments using baht No need to open a foreign account Increase your chances of receiving good returns. In an era where the world is more connected Information about investing around the world can be quickly accessed through various online platforms. Invest in foreign securities to diversify your risk and increase your chances of earning better returns. It is something that many Thai investors are increasingly interested in. However, investing directly in foreign stock markets It may come with many challenges, such as difficulties and transaction procedures. This includes transactions made in foreign currency. Opening a foreign securities trading account and tax issues, etc. The Stock Exchange of Thailand has developed investment products called DR (Depositary Receipt) and DRx (Fractional Depositary Receipt), which are depository receipts for foreign securities. that refer to securities or stocks of leading companies from around the world To provide convenience to investors Investors can conveniently trade DR and DRx on the stock exchange. with baht through an account opened with a securities company that is a member of the Stock Exchange of Thailand Similar to general securities trading No need to open foreign accounts or switch currencies or make international transfers. Helps reduce complexity and increase investment flexibility. Therefore, it is an interesting alternative to diversify investments abroad more efficiently. DR and DRx have a valuation reference mechanism with foreign securities, where the issuer of DR and DRx is not a foreign issuer. But will act as a holder of foreign securities by purchasing foreign securities to keep. and pass on various benefits from investment to DR and DRx instrument holders because DR and DRx are foreign securities depository receipts, where 1 unit of depository receipt may be equivalent to Units of the underlying security o r less. Depending on the determination of the conversion rate, for example, 10 DR: 1 reference security means 10 DR units equivalent to 1 reference stock or 2,000 DRx: 1 reference security means 2,000 DRx units equivalent to 1 reference stock, etc. Therefore, investors should check the conversion rate to be able to assess the appropriate DR and DRx trading price by comparing it with the price of the underlying security. The objective of this design is to make investment accessible for a smaller amount than directly purchasing foreign stocks, especially large-cap foreign stocks that may have a relatively high price per share. In addition, DR issuers and DRx or designee Will act as a market maker (Market Maker) for the respective DR or DRx to help strengthen trading liquidity for investors as well. Another interesting feature of DR and DRx is that it requires a small initial investment. For DR, you can invest from 1 DR unit, which currently has a starting price of only a few baht. and has a trading fee simila r to trading in general stocks, while DRx can be invested in fractional shares by trading in the amount of baht or the number of DRx units, and service providers generally collect a trading fee of only 0.16% ( VAT not included) Investors can therefore access investments conveniently. Even with limited funds You may also choose to gradually accumulate investment units over the long term by averaging (Dollar Cost Averaging or DCA), which is a disciplined investment strategy. The emphasis is on investing the same amount of money regularly even though market conditions may fluctuate. This will help in averaging the cost of long-term investments, such as investing an equal amount of 500 baht every month to accumulate investments in world-class leading stocks, etc. (You can learn more about DCA investing at https http://www.setinvestnow.com/th/beginner/growing-portfolio-dca) In addition to convenience, DR and DRx are investment products whose issuance and offering are regulated under the Securities and Exchange A ct. The regulator has issued clear regulations to protect the rights of investors. There are supervisory guidelines such as the issuer of DR and DRx must be a stable financial institution. There must be the full amount of underlying securities issued for DR and DRx. News on the underlying securities must be followed and important information disseminated to investors. And there are clear terms and conditions for investors' rights in cases where investors can exercise rights similar to being direct shareholders, such as the right to receive dividends. Rights to subscribe for new shares, etc. These mechanisms are intended to build confidence among investors that investing in DR and DRx is reliable and has been fully taken care of according to the rights that investors should receive. For tax obligations related to investments in DR and DRx, individual investors will be subject to a withholding tax of 10% on dividends received. Without having to take the above income into calculation to pay taxes again. Current ly, the Stock Exchange of Thailand has 24 and 10 securities registered for trading in DR and DRx, respectively (information as of April 22, 2024), covering important indices and stocks from many countries around the world. both developed markets such as the United States, Europe, Japan, and Singapore, and emerging markets with potential. like China and Vietnam There are both DR products that are based on stock indexes (Index) and products that are based on individual stocks (Single Stock) such as Alibaba, Tencent, BYD, XIAOMI, Pingan, Netease, Baidu from China, Singapore Airlines from Singapore and ASML from Europe and DRx products are based on large US stocks such as Apple, Tesla, Microsoft, NVIDIA, Alphabet, Meta, Amazon, Starbucks, Netflix and Booking Holdings. With a wide range of investment options in terms of countries and industry groups, DR and DRx products will It allows investors to conveniently and easily diversify their investments among quality assets from around the world. It is an alternative t o diversify risk and increase the opportunity to receive good returns. However, investing in DR and DRx still involves risks that investors should understand carefully, similar to considering investing in other securities, both in terms of fundamentals and fluctuations in the prices of the underlying securities. This is a result of operating results, business plans, competitors, and various risks in the economy and financial markets. In addition, DR and DRx are subject to additional exchange rate risks similar to direct foreign investments. Even though trading is done in baht, because the price of the underlying security is in a foreign currency, therefore Investors should study various information related to investing in securities. You may also consider arranging your portfolio to diversify your investments in many countries and various industry groups. and consider the operations and services of reliable DR and DRx issuers, as well as the forms, conditions, and methods for managing various benefits from investing in DR and DRx as specified by the issuer. For interested investors Starting to invest in DR and DRx is quite convenient. It is similar to opening a securities trading account with a securities company that provides services. For DR, trading orders can be sent through all channels just like general stock trading, and for DRx, trading can be done through the Streaming Mobile Application channel with more than DRx trading service brokers. 27 locations by requesting to trade DRx yourself, just press the My Menu button in the Streaming application, select the DRx menu and press the 'Request DRx Trading' button. In the present world Diversifying investments across a variety of assets is an approach that is gaining more and more attention. DR and DRx are another portfolio construction option that allows investors to diversify their risk and diversify their investments. many industrial groups in many countries conveniently both in developed and emerging markets along with a regulatory mechanism And the con venience of investing in DR and DRx is another interesting investment option. For Thai investors who are ready to step onto the global investment stage, additional information about DR and DRx can be found at the SET website or www.setinvestnow.com/th/newdr. and www.setinvestnow.com/drx . Source: Thai News Agency