How to Buy US Treasuries in the UAE

Summary: UAE investors have the opportunity to diversify their portfolios by investing in US Treasuries, including short-term bills and long-term bonds, through platforms like eToro. With over 4,500 assets available, eToro facilitates a straightforward investment process, supported by a range of AED and USD payment options.

It's essential for investors to understand the fee structure and consult with financial advisors to align investments with personal financial goals, ensuring a strategic approach to capitalizing on US-backed yields.

Can I Buy US Treasuries in the UAE?

Yes, investors in the UAE can indeed purchase US Treasuries, such as Treasury Bonds, Treasury Bills, and Treasury ETFs that offer dividends. These US government debt securities are accessible through regulated brokers in the UAE, which are monitored by financial authorities. Payment options for these investments include bank transfers and debit cards, making it straightforward for UAE residents to invest in US Treasuries and enjoy the benefits of US-backed yields.. 

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How to Buy US Treasuries in the UAE

Buying US Treasuries from the UAE is straightforward with eToro, a global platform known for its compliance with regulatory standards and a diverse portfolio, including over 4,500 assets. It’s an excellent venue for those interested in US Treasury investments, such as the short-term SPDR Bloomberg 1-3 Month T-Bill ETF (BIL) and the medium-term iShares 1-3 Year Treasury Bond ETF (SHY).

Follow these steps to get started:

1. Sign Up with eToro: Create an account and verify your identity.
2. Deposit Funds: Click on 'Deposit Funds', select your currency, and use common UAE payment methods to add money to your account.
3. Choose a Deposit Method: Pick a preferred method, like a bank wire transfer, from your UAE bank.
4. Search for Investments: Use eToro’s search tool to find the US Treasury ETF that meets your investment needs.

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Best US Treasuries for UAE Investors

Selecting the right US Treasury ETF hinges on personal finance goals, risk comfort, and financial situation. With options from short-term T-Bills to long-term T-Bonds, each US Treasury ETF has its risk and return dynamics.

Consider these US Treasury ETFs for investment in the UAE:

• SPDR Bloomberg 1-3 Month T-Bill ETF (BIL): Best for cautious investors, focusing on short-term U.S. Treasury Bills.
• iShares 1-3 Year Treasury Bond ETF (SHY): Fits those looking for a yield-risk balance, targeting 1-3 year maturities.
• iShares 20+ Year Treasury Bond ETF (TLT): For those open to more risk for potentially higher returns, concentrating on long-term bonds.
• Vanguard Intermediate-Term Treasury ETF (VGIT): Offers a mid-term maturity balance of risk and return.

UAE investors can pick from currency-hedged or unhedged ETFs based on their view of currency risks. Always consult a financial advisor and do your homework before investing.

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What are the Fees?

Trading US Treasury ETFs in the UAE on various platforms can involve different fees. These fees depend on the investor's location and the specific financial instruments being traded. Here, we outline the potential fees you might encounter when using eToro in the UAE:

• Zero Commission: eToro facilitates commission-free trading on US Treasury ETFs, except for positions that are short or using leverage.
• FX Fees: If you carry out transactions in currencies other than the US Dollar, you'll be subject to currency conversion fees.
• Market Spread: This is the difference between the selling and buying prices of a security. It's important to note that this spread is not a direct fee charged by eToro but is inherent in trading.
• CFD Overnight Fees: For leveraged positions held overnight, there are fees, which are calculated based on the 1-month USD LIBOR rate.
• Weekend Fees: Positions held over the weekend incur triple the regular overnight fee, usually billed on Fridays.

For investors in the UAE, it's crucial to thoroughly review eToro’s fee structure to understand all potential costs involved. This ensures that investment decisions are made with a clear understanding of the financial implications.

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Bottom Line

In conclusion, investing in US Treasuries from the UAE is a viable and straightforward option for those looking to diversify their portfolio with US government debt securities. Platforms like eToro offer an easy-to-navigate system, providing access to a wide range of US Treasuries, catering to various investment strategies and risk preferences. With the convenience of multiple payment methods and the guidance of regulated brokers, UAE residents can efficiently invest in US Treasuries.