Investment Brokerage in Singapore | Investment Options in Singapore
Investmentby Priyadarshini 13 May 2022
You’ve done enough research on how to begin investing. You’ve double-checked your emergency savings account. You’re finally prepared to make a fortune in the stock market! What happens next? In this blog, we tell you about investment brokerage in Singapore.
The next step is to choose an investment brokerage that will allow you to purchase your first shares. But it’s easier said than done. The sheer variety of brokerages available, ranging from bank brokerages such as DBS Vickers and UOB KayHian to independent brokerages such as Saxo Markets and POEMS, can be bewildering.
Investment Brokerage in Singapore
So, how do you choose the finest investing agency for you?
Here are three major considerations to consider when selecting the finest brokerage business for you:
- Commission fees: The expense of purchasing or selling your investments.
- Type of account: Whether a CDP or a custodial account,
- A platform for trading: How simple the brokerage is to use
Fees for investment brokerage commissions
Every stock market transaction is subject to a commission fee charged by investment brokerage firms. When you acquire stock, you are charged. When you sell shares, you get charged as well. The commission is divided into two parts: the fee itself (a percentage of your transaction) and the minimum fee (a dollar amount).
If you’re the type of investor who simply parks a large chunk of money for decades, commission costs won’t make much of a difference. However, if you invest frequently, you should anticipate being charged commission fees several times. As a result, it is critical to select one that costs reasonable fees.
SAXO and POEMS are now the two cheapest investing brokerages on the market. On Singapore stocks, both charge a 0.08 percent commission with a $5 minimum and no minimum cost.
In the case of the $3,000 Singtel shares, the commission is only $2.40. When compared to bank brokerages like DBS Vickers, which charge roughly 0.25 percent for every trade with a minimum of up to $25, this is extremely low.
CDP versus Custodian Account
Trying to decide between POEMS and SAXO? One of the major distinctions is the “Stock Holding Type,” or the type of account used for Singapore stocks. POEMS maintains a CDP account, but SAXO has a custodian account. What’s the distinction?
CDP account: Stocks are stored in your own personal CDP account in your name. You have full shareholder rights, including the ability to attend AGMs (annual general meetings). Your ownership of the shares will not be affected if the brokerage goes bankrupt.
Custodian account: Because the brokerage holds the stocks on your behalf, they are not officially in your name. Sounds scary, but the MAS strictly oversees the financial industry in Singapore, and most brokerages keep custodian accounts separate so that they are not adversely impacted.
Trading platform for investments
Finally, you should look into the investment brokerage’s online trading platform, which could be a website or mobile app. These enable you to check stock prices and invest while on the go. Naturally, you’d want to choose an investment broker with an easy-to-use, user-friendly, and bug-free online trading platform.
So, before you commit to a specific investment broker, test out their platform to see whether it’s something you’d be glad to use again and again. If it’s buggy, doesn’t provide the correct information, and lacks the necessary tools, then look for other choices.
Investment Brokerage in Singapore – Here’s how to open a CDP Account?
If you’ve chosen an investing firm that allows you to own stocks through CDP, you’ll need to open a CDP securities account. To open an account, you must be at least 18 years old and NOT an undischarged bankrupt. You can do this directly with The Central Depository (a very simple process) or through a “Depository Agent” — a stockbroking firm, trust company, or bank nominee.
While you can work with as many brokerage firms as you choose, you only need to open one CDP securities account to deposit all of the equities you’ve purchased.
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