Fidelity launches online trading platform for foreign stocks and currency exchanges

Source: Fidelity Investments

Fidelity Investments today announced it has significantly expanded its international investing capabilities with the launch of a new online platform that can make it faster, easier and more accessible for retail investors, broker/dealers and financial advisors to trade international stocks and exchange foreign currencies in some of the world's largest and most popular international markets.

With this new offering, individual investors who trade on their own, or those who work with financial professionals, can more easily diversify the equity portions of their portfolios and take advantage of an increasingly global economy. According to new Fidelity research, investors say diversification and the potential for higher returns are the top two benefits of trading international stocks.

By combining this new international stock trading platform with the more than 1,200 mutual funds and 250 ETFs with international securities exposure already available, Fidelity now provides one of the industry's most comprehensive suite of international investing options.

Fidelity also published today a new Viewpoint, which is the company's customer e-newsletter that delivers weekly market and economic commentary, investment ideas and personal finance insights. The new Viewpoint, available at fidelity.com/internationalpov, discusses how international equity exposure as part of an investor's overall stock exposure may help reduce risk, while providing the potential for increased returns.

Specifically, Fidelity believes for most investors with longer-term timeframes (greater than five years), an international equity allocation of 30 percent of their overall stock allocation provides a reasonable tradeoff between the shorter term possibilities of increased volatility and the long-term potential for increased returns. Fidelity announced this new weighting last month as part of a firm-wide enhancement to its online guidance tools, asset allocation portfolios, managed accounts, and across all Fidelity Freedom Fund product lines.

"When you consider that over the past 10 years, 80 percent of the world's best-performing stocks were listed outside the United States, it is understandable why investors are increasing their focus on international investing," said James C. Burton, president of Fidelity's retail brokerage business. "And when we asked investors what would make their international trading experience successful, the top responses were an easy to use trading platform, availability of research, and fast trade executions - all core features of Fidelity's new international trading platform."

With the new platform, retail investors and broker/dealer and advisor clients now have automated and direct access to a broad set of global markets and foreign currencies; third-party research, news and real-time market data and quotes for foreign currency and international equities; and streamlined processing and recordkeeping of international equities and foreign currencies.

"Fidelity's new international trading offering can help broker/dealers and advisors better meet their clients' international investing needs and provide greater efficiencies, enabling them to spend more time with clients and grow their businesses," said Richard N. Hart III, senior vice president, National Financial. "Additionally, the new offering, combined with the recent launch of Fidelity Clearing Canada ULC, reinforces Fidelity's commitment to building a global trading platform to support the evolving needs of its broker/dealer and advisor clients."

Retail Investors Can Trade Foreign Stocks as Easily as U.S. Stocks

Retail investors will be able to trade in 12 foreign markets and exchange eight currencies all from their existing brokerage accounts in which they currently conduct their domestic trading. This allows them to view all of their equity investments and currency positions in one place, and to be able to sort positions by country and currency. Investors can get started on Fidelity's new International Trading Web page: fidelity.com/internationaltrading.

The 12 markets available to retail investors represent those to which Fidelity's customers currently direct the vast majority of their international trades:

  • Australia
  • Belgium
  • Canada
  • France
  • Germany
  • Hong Kong
  • Italy
  • Japan
  • Netherlands
  • Norway
  • Portugal
  • United Kingdom

The eight currencies include:

  • Australian Dollar
  • British Pound
  • Canadian Dollar
  • Euro
  • Hong Kong Dollar
  • Japanese Yen
  • Norwegian Krone
  • U.S. Dollar

Fidelity gives investors the choice to settle foreign trades with U.S. dollars. When an investor chooses this option, it eliminates the extra step of having to exchange currencies before placing a trade. Instead, the investor places a foreign trade and then Fidelity automatically exchanges the exact amount of foreign currency needed to execute the trade when the order is filled. If it is not filled, no currency exchange takes place.

"Fidelity research shows that investors trading international stocks are often frustrated by the lack of information on foreign markets and companies(i)," said Burton. "As a result, Fidelity's platform provides real-time foreign quotes and market information, as well as independent research reports on companies overseas, all at no cost."

For international trading customers who want extra help, Fidelity provides phone access to international trading representatives 24 hours a day, six days a week. Additionally, Fidelity offers the Trading Knowledge Center, an online interactive learning tool that provides education on trading and investment strategies. In order to help customers better understand the advantages of international investing and how to conduct foreign stock trades and currency exchanges, Fidelity created a new Trading Knowledge Center module about international investing, available at personal.fidelity.com/products/trading/Knowledge_Center/tkc2/ (Click "Trade").

Broker/Dealers and Advisors Gain Increased Market Access and Efficiencies

To help broker/dealer and advisor clients more easily achieve diversification in their customers' portfolios, Fidelity provides straight-through execution, settlement and custody of stocks in 25 foreign markets and 16 currencies through its brokerage technology workstations. Combined with the markets and currencies listed above, broker/dealers and advisors also can access these markets and currencies:

  • Austria (Euro)
  • Denmark (Krone)
  • Finland (Euro)
  • Greece (Euro)
  • Ireland (Euro)
  • Mexico (Peso)
  • New Zealand (Dollar)
  • Poland (Zloty)
  • Singapore (Dollar)
  • South Africa (Rand)
  • Spain (Euro)
  • Sweden (Krona)
  • Switzerland (Franc)

Broker/dealers and advisors can provide their customers a single monthly account statement for their U.S. and local currency holdings, as well as a consolidated tax reporting statement. They can rely on dedicated trading support 24 hours a day, six days a week. For broker/dealers, Fidelity offers risk management tools, such as pre- and post-trade supervision, to help them monitor international transactions executed through Fidelity. More information about Fidelity's new international trading offering, including an online educational video, is available for broker/dealers and advisors at fidelity.com/institutional.

In addition to new online trading capabilities, broker/dealers and advisors also can execute trades in U.S. dollars, with the help of Fidelity Capital Markets' dedicated international trading desk, in the following countries: Argentina, Brazil, Czech Republic, Estonia, Hungary, Indonesia, Israel, Luxembourg, Malaysia, Peru, Philippines, Russia, South Korea, Taiwan, Thailand and Turkey.

"With more than half of the world's stock market opportunities residing outside the United States, Fidelity's new international trading platform offers retail investors, broker/dealers and advisors an easy way to reflect the global economy and diversify the equity portion of a portfolio," said Hart.

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