Everything is bigger and better in America -- even investing.
In economic terms, the US is a class apart. At $14 trillion, it's got the largest GDP of any country. The world's richest men, Bill Gates and Warren Buffett, are both American. Even their financial scandals are unimaginably gigantic -- Bernie Madoff stole more money than the GDP of Luxembourg!
No wonder the US stock market puts ours to shame.
Here are three reasons why US investors are spoiled -- and why you might want to join them in buying American.
Reason 1: Global brand leaders
If you want to invest in dominant companies with the best brands on Earth, the US market is the only place to shop.
Coke. American Express. Apple. IBM. Boeing. Starbucks. McDonalds. Google. Microsoft. Each boasts a brand that is known from Kansas to Katmundu, and their shares are yours to own courtesy of the US stock market.
Most other countries have just one or two big brands: Germany has Volkswagen, Finland has Nokia, France has L'Oreal and Switzerland has Nestle. Only Japan, with Sony, Nintendo, Canon, Honda and the like comes close.
Here in the UK we might have multinationals like Vodafone (LSE: VOD), HSBC (LSE: HSBA) or Royal Dutch Shell (LSE: RDSB), but these brands are hardly comparable to the best of the US.
Most Coke fans wouldn't swap it for another fizzy drink. But who really cares who provides their phone line, their ATMs, or their petrol?
Reason 2: Breadth and depth
There are over 6,000 stocks traded on the two main American markets -- the New York Stock Exchange and NASDAQ -- and you can add another 500 for the less well-known American Stock Exchange. That makes the 3,200 or so companies apparently listed in London, including those on AIM, look relatively meagre.
I'd suggest the wider choice gives American investors better odds of discovering good yet unknown companies that are under-researched by analysts.
In his excellent One Up On Wall Street, legendary investor and fund manager Peter Lynch talks about discovering companies who've never been visited by analysts or bought by an institution.
That can't happen in Britain very often. UK small caps might go through periods of unpopularity, but that's more about fashion than anonymity, except at the tiniest end of the spectrum. True, if you add the UK market to the rest of Europe, our hunting ground expands. Moreover, the total value of the European market is comparable to the US.
But even then, US investors still have language and familiarity on their side. Companies headquartered in Michigan and Miami with products used by the same consumers are far easier to compare than companies based in London and Rome.
Reason 3: A peerless tech sector
For a week or two in the late 1990s, the UK listed technology sector was as exciting as America's, albeit centred on up-and-coming 'New Economy' companies rather than incumbents like Hewlett-Packard or Cisco.
We all know what happened next.
Nine years after the dotcom crash, and UK tech investors can choose between ARM (LSE: ARM) and Autonomy (LSE: AU) from the FTSE 100, a few unglamorous service providers like Kewill (LSE: KWL) and Misys (LSE: MSY), and some start-ups.
Want to invest in hardware giants? Buy Intel, AMD, Apple or Palm. Want to invest in Internet companies? Choose from the likes of Amazon, Yahoo, eBay and Google. All of them American; in comparison the UK technology sector is feeble.
I think most UK investors -- even index followers -- should add extra exposure to U.S. technology via a fund or ETF. If you don't, you're underweight a big chunk of the world's economy.
Made in America
Now some good news: investing in America is easy, with several ETFs and index trackers available, as well as specialist investment trusts and funds.
You can also buy American companies directly through most online trading accounts, after filling in a bit of paperwork. Researching US companies is straightforward, thanks to the profusion of information available online. (Try out Fool.co.uk's sister site, Fool.com).
The downside of buying American stocks is currency risk. If you buy shares in Apple they might double, but the value of your investment will go nowhere if the pound also doubles versus the dollar in the meantime.
Of course, if the pound weakens against the dollar, you'll gain, so it's swings and roundabouts. Nevertheless, currency speculation is an unwanted side affect if you want exposure to America's great companies rather than its currency.
Perhaps the best way to buy American stocks will prove to be the new trackers from Vanguard that were announced last month.
Vanguard is a US giant – notice a theme? – and it's talking about charges of just 0.2% to follow the US market, which is lower than UK rivals.
Of course, passive index tracking was invented in America and they've had longer to refine it. But cheap trackers have found us eventually, like most ideas dreamed up Stateside.
Perhaps that's the best reason to invest in America of all.
More from Owain Bennallack:
> US shares are available via The Motley Fool Share Dealing service. International trades cost just £17.50 and it's free to open an account.
