Brokers recognize both the attraction of foreign stocks and the difficulties they present for the average customer, so some are making it easier. Big discount broker Charles Schwab, for instance, has a Global Investing Services Group that helps clients trade foreign stocks. If a client is interested in, say, wind power stocks, a Schwab broker will print out a list of global wind companies and help narrow the search down to a couple of suitable prospects. Then they'll execute the trade, on the Pink Sheets if it's a small order or directly on the relevant foreign exchange if it's large. Limit orders can be placed in U.S. dollars.

According to a Schwab spokesman, "The foreign market maker will see the U.S. dollar limit and when they transact the price they'll handle the foreign currency exchange, any markups, clearing costs, or settlement costs. The limit price is all you pay in addition to the Schwab commission." Because of their complexity, foreign stock trades are done over the phone rather than electronically, with the client speaking directly with the trader who's placing the trade. As part of the same conversation, the trader will also explain the tax implications of capital gains and dividends generated in the foreign market. And after the investment is made, Schwab promises to forward financial reports and other information.

Full-Service Foreign Stock Specialist

You might recognize Peter Schiff from his frequent appearances on CNBC and other media. He's made a name for himself as a "bear" on the U.S. financial markets, correctly predicting much of the turmoil that was gripping dollar-denominated investments in early 2008. He also owns a brokerage house, Euro Pacific Capital that specializes in giving U.S. investors access to foreign stocks. Schiff and his brokers trade directly on foreign exchanges for their customers, charging commissions that are higher than the discount brokers but providing all the full-service handholding of a Merrill Lynch. "When I get an order to buy shares in Hong Kong I'll wait until that market opens and I'll buy the shares just the way the market maker would. The customer gets the same price the market maker would have gotten," says Schiff. Another benefit of working with a specialist is the ability to help clients determine the right limit price. "When you trade on the Pink Sheets, there's no one who understands the markets. But we specialize in foreign stocks, so my brokers know exactly what to do, how to find the stock, how to get a price, and how to translate the foreign currency price into a local currency. They'll understand the rules of the exchanges and the hours they trade. They might even be familiar with the stock already and be able to offer an opinion on it."

Euro Pacific charges a minimum commission of $50 per trade, but beyond that, fees vary based on the size of the order and the amount of advice given. A big order entered by a customer who knows exactly what he wants will have a lower per share fee than a small order from a customer who needs extensive advice.