Beginner's Guide to Trading Foreign Stocks: 3 Main Strategies and Key Stocks for 2025

In the era of globalization in financial markets, trading foreign stocks has become an essential tool for investors seeking to diversify their portfolios and profit from the growth of leading companies worldwide. However, many investors are still unsure about how to start correctly. This article will introduce three different methods for trading foreign stocks, so you can choose according to your situation and investment goals.

Why invest in foreign stocks?

Cross-border investing offers many advantages for your portfolio. First, it helps diversify risk from the Thai market, which can be highly volatile. By holding stocks in other currencies such as US dollars, you can protect yourself from fluctuations in the Thai baht.

Second, trading foreign stocks opens the door for you to access industries not represented in Thailand, such as leading technology companies, electric vehicles, and global pharmaceutical firms.

Third, returns from many foreign companies are often higher than the Thai market, due to broader growth opportunities and more sophisticated management.

However, investing abroad also comes with risks, especially exchange rate risk and economic and political uncertainties of the respective countries. Therefore, thorough research before making investment decisions is essential.

Three main methods for trading foreign stocks

Method 1: Foreign Equity Mutual Funds

For beginners with no experience in buying individual stocks, mutual funds are the most suitable option. By investing through mutual funds, you benefit from professional management, which selects numerous foreign stocks on your behalf.

Mutual funds have various investment policies, such as focusing on US stocks, Asian stocks, or global stocks. Some funds invest directly in foreign stocks, while others use a Feeder Fund structure that invests through other mutual fund management companies.

Details such as the top 10 stocks, historical returns, and fees can be found in the fund’s prospectus. Currently, investing in mutual funds is easy via bank apps and brokerage platforms.

Advantages: Easy access, low minimum investment, lower risk than buying individual stocks, managed by experts.

Disadvantages: Fees and expenses reduce net returns, not suitable for short-term traders, lower liquidity compared to individual stocks.

Method 2: Trading Foreign Stocks via CFD(

CFD, or Contract for Difference, is a highly flexible tool for trading foreign stocks. With this method, you can trade both in rising and falling markets without owning the actual stocks.

Using leverage allows you to control larger stock positions with less capital, increasing trading flexibility.

Advantages: Very low minimum capital, can trade both long and short, high liquidity, many stock options.

Disadvantages: Very high risk because leverage amplifies both gains and losses, not suitable for beginners without good risk management.

) Method 3: Investing through Securities Companies in Individual Stocks

This method is similar to investing in Thai stocks, but you need to open a foreign stock trading account with a securities company that offers this service. The securities firm will provide a selection of foreign stocks, along with analysis and updated information.

You will earn returns from stock price appreciation and dividends, just like Thai stocks.

Advantages: Ability to select individual stocks of interest, analysis from professionals.

Disadvantages: Requires larger capital, as foreign stock prices are often higher, stock options may be limited to what the securities company offers, trading hours may differ from the Thai market.

Foreign stocks to watch in 2025

( NVIDIA ) NASDAQ: NVDA###

NVIDIA is a leader in AI processing chip design with no competitors in the market. The company balances hardware GPU sales with the development of the strong CUDA software ecosystem.

The demand for new data center chips from major tech companies continues to grow, providing NVIDIA with sustainable growth opportunities in the coming years.

Microsoft ( NASDAQ: MSFT)

Microsoft demonstrates how integrating AI into existing products creates new value. The launch of Copilot, which incorporates AI across all platforms—from Office, operating systems, to Azure cloud—illustrates this.

Azure cloud business benefits from increasing AI processing demand, positioning Microsoft strongly in both AI technology and revenue generation.

Eli Lilly ( NYSE: LLY)

Eli Lilly is a leading pharmaceutical company benefiting from the preventive healthcare trend. Its drugs Mounjaro and Zepbound are highly popular for weight management and diabetes.

The company has the potential to expand its products into treating other related diseases, making it a significant growth stock outside the tech sector.

ASML Holding ( NASDAQ: ASML)

ASML is the only company in the world manufacturing Extreme Ultraviolet (EUV) lithography machines for chip production. Any company aiming to produce next-generation chips, whether Samsung or Intel, depends on ASML.

Investing in ASML is akin to investing in the infrastructure of digital technology, with risks different from other tech companies.

Visa ( NYSE: V)

Visa is the largest payment network provider worldwide. As society shifts towards cashless transactions, Visa benefits directly.

Its business relies on small fees from each transaction on its network. Growth in travel, e-commerce, and cross-border payments continuously drives the company’s expansion.

First steps to trading foreign stocks

Getting started with foreign stock trading is not as difficult as it seems. The key is to choose the method suitable for your situation and to conduct smart research before investing.

For beginners, start with small investments in mutual funds or individual stocks you trust. As you gain experience, you can explore other methods like CFDs.

Today, trading technology is more convenient than ever, making cross-border investing accessible to everyone. Be sure to study the information well, manage your risks, and begin your journey into global investing with a mindful approach.