07 — Global
International Funds
Global diversification, rupee-simple.
Curated access to the US, developed-market, and emerging-market equities — via feeder funds, FoFs, and the LRS route where appropriate.
International funds give Indian investors participation in global business, currency, and innovation trends — from Nasdaq mega-caps to emerging-market consumer stories.
Fig. 07 — International Funds
Global
Horizon
5 – 15+ years
Risk
High
Liquidity
T+4 to T+6
Ticket size
₹5,000+ (feeder) / $250K LRS
I — What are International Funds
International funds enable investments in markets outside India, by holding in their portfolio one or more of the following:
- Equity of companies listed abroad.
- ADRs and GDRs of Indian companies.
- Debt of companies listed abroad.
- ETFs of other countries.
- Units of passive index funds in other countries.
- Units of actively managed mutual funds in other countries.
- They can hold some portion of the portfolio in money market instruments to manage liquidity.
- Diversification, since global markets may have a low correlation with domestic markets.
- Investment options that may not be available domestically.
- Access to companies that are global leaders in their field.
- Political events and macro economic factors that are less familiar and therefore difficult to interpret
- Movements in foreign exchange rate may affect the return on redemption
- Countries may change their investment policy towards global investors.
How it works
A four-step process
01
Frame the thesis
USD hedge, tech exposure, or true diversification — the objective determines the vehicle.
02
Choose the route
Feeder funds in ₹; LRS for direct US brokerage; GIFT City for institutional-grade wrappers.
03
Size the sleeve
Typically 10–25% of equity, capped to preserve rupee-earnings alignment.
04
Report cleanly
Consolidated statements bridge INR NAV, USD holdings, FX, and taxation.
Chapter — Fit
Who this is for.
International Funds is not for every investor — and that is the point. We choose it deliberately, when the mandate calls for it.
01
Families with USD liabilities (education, real estate)
02
Portfolios overexposed to Indian mid/small caps
03
Investors seeking innovation and reserve-currency exposure
04
NRIs planning multi-jurisdiction wealth
Why it works
Structural advantages
01 / 04
Currency hedge
USD-denominated assets offset rupee depreciation over long horizons.
02 / 04
Sector access
Public exposure to sectors India’s market underweights — semi, biotech, hyperscalers.
0 3/ 04
Diversification
True low-correlation over rolling 5-year windows.
04 / 04
Wealth planning
Aligns portfolio with global spend, education, and estate footprints.
Reference — SEBI Categories
Regulatory framework
International funds enable participation in markets outside India by holding one or more of the following in the portfolio.
01
Foreign Listed Equity
Direct equity of companies listed on international exchanges.
02
ADRs & GDRs
American and Global Depository Receipts of Indian companies listed abroad.
03
Foreign Listed Debt
Bonds and debt of companies listed on international exchanges.
04
Country ETFs
Exchange-traded funds tracking foreign country or region indices.
05
Passive Index Funds Abroad
Units of passively managed index funds in other jurisdictions.
06
Active Foreign Funds
Units of actively managed mutual funds domiciled abroad.
01
International funds may hold a portion in Indian equity, debt, or money-market instruments to manage liquidity.
02
Risks include political and macro factors, currency movements on redemption, and changes in a country’s policy toward global investors.
03
For taxation, these are treated as non-equity oriented mutual fund schemes.
Considerations
What we tell you before you commit.
01
Currency volatility can offset equity returns near-term.
02
Tax treatment less favourable than domestic equity funds.
03
RBI limits on international allocations can pause fresh inflows.
Frequently asked
Answered plainly
Feeder fund or LRS?
Feeder is simpler and rupee-native; LRS gives direct US brokerage access and estate-tax planning options.
How are gains taxed?
International funds are taxed as non-equity (slab, post-2023). We factor this into net-of-tax return expectations.
Ready to explore this route for your portfolio?
A private, no-obligation conversation with one of our experts — begin with your mandate, not a product.