Offshore Brokerage

Whenever dealing with an offshore brokerage for the purpose of investing offshore, finding out about offshore strategies that can be employed to complement your investment ventures is always a smart move. There are offshore trusts, offshore foundations, offshore companies, like Seychelles company, and limited liability companies (LLC’s) in whose names offshore brokerage accounts can be opened or to which returns can be transferred for tax purposes, as well as to lower the risk of losing significant amounts of money as a result of litigation.

Offshore brokerage agencies and firms play a critical role in facilitating the investment process between investors and markets. Not only do they provide advice, further contact information can be given for offshore banks and other corporate service providers that specialize in wealth, tax and estate planning. By building this type of relationship, it becomes possible to obtain information on ways and means to protect assets, access overseas markets for investment possibilities and business expansion. Once the right links can be developed, an offshore brokerage can help in achieving specific financial goals, be they long-term or short-term.

Depending on the type of trading that an offshore brokerage is involved in, it will be classified accordingly. Many times, a single offshore brokerage can fall into different categories based on which end of the trade it finds itself in. This can be explained by the different terms that have been used to identify offshore brokers, such as resellers, broker-dealers, contra brokers and agency brokers, to name a few.

Offshore brokerage agencies (agency brokers) trade on behalf of investors and are the intermediaries between the stock market and the customer (the investor). The investments made by this type of offshore brokerage can be either specified by the customer or left to be according to discretion. In regard to the latter, such an arrangement will give an offshore brokerage a certain degree of leeway which would tend to be the case if the customer simply wants to invest but knows very little about markets and trades etc. Trading is done offshore and not in the country of the customer and such an offshore brokerage will be registered in that country where trading is done. An offshore brokerage may operate as a broker-dealer if it is engaged in both buying and selling. If the offshore brokerage sells securities it is specifically referred to as the contra broker which is the offshore brokerage or person that is on the selling end of the trade.

Offshore brokerages that trade in the name of their clients at reduced rates are usually referred to as discount offshore brokers. As established and more professional institutions, the cost of managing an offshore brokerage account at an offshore bank with brokerage services or a traditional brokerage firm would tend to be much higher than that of the tradition offshore broker or offshore bank. It is possible to obtain offshore brokerage services from discount brokers online, so it is possible to find this type of service readily obtainable and accessible to individuals and small entrepreneurs.

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