Online option stock trade trading singapore ke

September 25, by Kyith 1 Comment. You would like to kick start investing or building wealth by purchasing and selling some financial assets. This article is best suited for the beginners who have no idea how to get started buying and selling stock s. They have heard that they can purchase this stock, that stock, these REITs and STI ETF but have no idea how to absolutely get started. After learning that you need to build wealth, you want to know how you go about owning financial assets.

Financial Assets are the instruments that you purchase, hoping that they provide you with a good returns. A stock is a single or batch of shares which gives you ownership to a business that is listed.

You have used and enjoy the products and services of Singtel, Old Chang Kee, Jumbo Seafood, Starhub, Capitaland and would like to participate in becoming a shareholder to own a small part of this business. If you got to SGX. Those businesses will be listed on the Singapore Stock Exchange. Bonds are IOUs or Debts that companies and businesses issue to you, you hand over the cash to them.

In return, they pay you a coupon semi annually. At the end of the loan term, the bond issuer returns you the principal. There are much more bonds in Singapore, but they are usually not accessible to us. For example, the first bond is issued by FCL , which is a business listed on SGX. If you purchase this bond, you take over as the debt holder and get paid the coupon.

You can also find preference shares of companies listed on SGX. Preference shares are like your stocks. They belong to the equity part of the balance sheet instead of debt.

You can also find issued Singapore Government Bonds on SGX.

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These are debts that the Singapore Government issue to you, with different duration. You can find real estate investment trust listed on SGX. REITs are a pool of properties you come across often, be it shopping malls, commercial buildings, logistical warehouses. By buying these REITs, you are able to earn a dividend payment but also gain or lose share price appreciation. In a unit trust, you have a manager that takes your money and buy, sell and manage a pool of stocks or bonds based on the theme they set out to do.

ETF are like unit trust, but they are listed, and that instead of a human manager, you have a machine that manages it. Their idea is to track the indexes that the unit trust is suppose to beat. You will be familiar with some of the indexes. If you are a Singaporean, you may be familiar with the Straits Times Index STI , there is an ETF called STI ETF to track that.

If you are into gold, there is a GLD ETF. If you want exposure to the top china firms, there is a China 50 Index. ETFs allows you to gain exposure to various markets, and unlike unit trust, their performance should be close to what the index do. As these ETF owns a basket of stocks, if the stocks distribute dividends, your ETF also distributes dividends. Let me explain to you how the main components work, to give you a better idea and enhance your understanding.

Broker works in brokerages and they act as the middle man to help you transact the buy and sell transactions. However, in this time and age, you can do most of these stuff over the internet on your computer desktop or your mobile phone.

The other party is the stock exchange, in this case SGX. In this case it is CDP, which stands for the Central Depository:. We provide integrated clearing, settlement and depository facilities for our customers in the Singapore Securities Market, including both equities and fixed income instruments. As an investor, you can view and manage the investments you have with multiple brokers through a single CDP Securities Account.

CDP is rather specific to Singaporeans and only stores shares listed on the SGX and not shares from foreign exchanges. When you want to sell the securities it is rather similar to that of the buy process but in the opposite direction. We have settled how buying and selling works for the securities listed on the Singapore Stock Exchange. But first you need to make sure that your broker allows you to trade in the overseas exchange.

Most brokers allows you to buy and sell on USA exchanges. After that which other exchanges greatly differs. The most common way to open a brokerage account is to find the broker, print out the application form, and then to mail it.

If you wish to trade in the USA , you will need to fill in a W-8 Ben form which declares your withholding tax status.

When you speak to the broker representative, you will be presented with a few options. Here are my recommendations:. There are some bureaucratic steps you need to do. In order for MAS to determine that you are knowledgeable in the products provided such as REITs, Stocks, Bonds and Especially ETFs, you have to do an online test. This whole Step 2 can be performed before opening the Online Account. It is independent of whether you open a brokerage account.

Hey, perhaps you can do this right now! Once the application have been submitted, it will take some time for your account to be processed. All you can do is wait. In the mean time, do read through some of the resources your brokerage have provided on how to use their system.

Over a period of time, you will received what you need to start trading securities from the brokerage and CDP in your snail mail account. If you already have an existing CDP account, or OneKey 2FA Token, you might need to ensure that these are linked to this new brokerage account. Next, you need to check that you can access the various platforms , and make use of the services with your new credentials.

With the accounts infrastructure up, you can actually buy and sell the stocks, bonds and REITs you want. To find out what you can trade, you can tune in to SGX.

There are also many third party applications on the web, or on mobile that list and inventorize what you can purchase and sell more intuitively then the SGX website. Your brokerage platform will have something similar, but their price changes when trading will be closer to Live.

You will be able to see the prices flashing green when it moves up and red when it moves down. You can do a search for Ascendas REIT.

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In this screen shot, I set up a watch list that captures a list of REITs. You will then be shown a summary of the order. Do a check to ensure that is the amount you wish to purchase.

Every transaction will cost commission. Do review and check to make sure your trade is cost efficient we will discuss this later. It might look a little different but on your mobile platform, you can also find the stock Ascendas REIT.

When you touch on it, you will see the options available to you. In some platforms, the interface is not very intuitive. If you select CPF, it might jump back to Cash.

Once the buy order is matched by someone who will sell you at that price, most platforms will send out an SMS alert to inform you the order have been filled. At night, you will received an SMS that indicates how many shares are credited into your CDP account.

Selling through your brokerage platform is almost similar, except instead of Buy you choose to sell. Important note of difference between Normal Sell and Short Sell: Why is this important?

There is a normal sell and there is short sell. However, if you key wrongly and sell 10,, the transaction will still go through. However, your broker is treating that you own shares and you sell it AND shares you do not own but you sell it. You will be borrowing shares from someone else, and you have to buy back to return to that person.

So if your intention is to sell off what you own only, please know how much you own in your CDP or custodian account. You will also key in how much you wish to sell, at what price and what is the payment type.

Note the difference between Sell and Short Sell. To answer that question, you need to understand the stock market. The stock market is like a fish market. I am not going to buy at that price! Here is an illustration of our Ascendas REIT example. Visualize that there is a Buy Queue and a Sell Queue. But you as the buy have the option to queue along near this price.

However, if the volume is not enough, and your order is too big, your order might be partially filled, meanings some of your order is not fulfilled. You need to pay commission. Sometimes the minimum commission divide by a small fill e.

In this example we have a very illiquid stock Global Testing. They only have 35 million shares in the market. And the volume of shares queuing at those prices are so low. It is very hard to get filled. This is a nightmare for investors with large capital and if they want the stock, they may end up moving the market by buying up. Whether it is a buy transaction or a sell transaction there is a commission. For various exchanges, due to different currencies, the commission amount is different.

There is a minimum commission that if the commission for the transaction is too low, they will want you to pay the minimum.

If its more than that its like 0. Cost is a factor in the long run, and it is wise that you size your trades accordingly to optimize the cost. You can pay through ATM. That is old school. Most people nowadays pay through their banking platform using Electronic Payment for Shares EPS.

There will be many accounts linked to one bank. Select the account under Recipient Name. Then choose Lump Sum or Individual Contract Payment. When you select Individual Contract Payment, the securities and its cost is listed in another screen and you can select it and pay for that.

Use Lump Sum, if you did a contra trade, or you are confident you know how much your shares cost in total. Your broker will receive this and he will allocate it accordingly. For proceeds from a sale, if its SGD, they will automatically deposit into your designated bank account. In the screen shot above, you can see the proceeds from dividends deposited. Have to apologize but that is not Proceeds from Sale, but are payments made for share purchases. If you are purchasing local shares, you can see the status of what you purchase when you login to cdp.

If you purchase shares from overseas exchange, the custodian will be handled by the brokerages. In this case there are fees involve:.

Take a look at this example from Kim Eng. This is waive if you make more trades. Here is the table for some other form of corporate action. There are also fee to handle rights issue.

He's Up $170,000 Trading Singapore Stocks now.

Which is why it makes handling rights issue as an overseas investor to be frustrating. As far as I understand now, only Standard Chartered Online Trading do not have these forms of fee. How they differ from the traditional brokerage process describe in the article is that instead of the broker paying for your shares first and you paying him or her back within 3 days, you fund the account first.

If there is no funding, you cannot buy. In exchange, your commission rates is lower. The broker takes less risks as well. The flip side is that, for local shares, your shares will be stored with the custodian of the brokerage , instead of the CDP. Your brokerage platform can be rather nifty in helping you track what you buy and sell through their platform. However, if you are using different platforms, and have some financial assets that you are tracking yourself, you might want more control , on a platform that you can have a holistic view.

I came up with a Google Spreadsheet that updates its prices from Yahoo or Google Finance, and track your holdings based on transactions. The above takes you to how I use it to track my own portfolio. You can use it for FREE here. It will not Work. I have show you how to buy and sell on the stock exchange. This should help you navigate your first few trades with greater confidence. To build wealth machines , you need to be motivated to learn , and you need to acquire the knowledge and wisdom to build wealth.

Pick up some books from the library to read. Then reflect to see if what was explained to you in the book aligns with your character. Then read and learn more. Kyith Ng is the founder of Investment Moats, which mentors readers on wealth management to work towards financial independence.

Your email address will not be published. Notify me of follow-up comments by email. Notify me of new posts by email. Kyith Ng is the founder of Investment Moats, which mentors you on wealth management towards Financial Independence.

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Investment Moats shows how you can build wealth through stock market investing, dividend income investing through a value based approach.

And then to distribute wealth. At the start of 32 years old, I set a 10 year target of how much my Wealth Fund to accumulate by end of 41 years old. Purely savings, inclusive of company units from employment. You would like to: Here are some financial assets that can be bought and sold. Local Stocks or Listed Businesses A stock is a single or batch of shares which gives you ownership to a business that is listed.

Bonds, Preferential Shares Bonds are IOUs or Debts that companies and businesses issue to you, you hand over the cash to them. They are hybrid between bonds and equity and typically have bond like qualities.

Real Estate Investment Trusts REITs You can find real estate investment trust listed on SGX. A manager manages these properties for you, finance these property partly by debts. Exchange Traded Funds ETF Exchange Traded Funds are like Listed Unit Trusts, which you may be familiar with. Overseas Stocks or Listed Businesses SGX is not the only stock exchange in the world. There are other exchanges around the world. And you might be interest in buying stocks in the USA, Spain or UK.

The Process of Buying and Selling Explained So how do we start buying these securities? The Process of Buying Local Securities As an individual investor, you sign up with a broker so that you can buy and sell securities. They also provide other services such as information, reports on stocks, custodian services. Brokerages are the shops that you may have heard from your friends: UOB Kay Hian POEMS Phillip Capital iOCBC Kim Eng Lim and Tan DBS Vickers In these firms, they have brokers working for them, which provide you with the services.

How does the interaction work? What is a custodian account? In this case it is CDP, which stands for the Central Depository: When you want to purchase a security, you issue Step 1: You convey which security you would like to buy, at what price, at what quantity Step 2: The Process of Selling Local Securities When you want to sell the securities it is rather similar to that of the buy process but in the opposite direction.

You issue a sell order. You check how much shares you have, how much you want to sell, and sell at what price and let the broker know Step 2: The broker lists the order on the exchange Step 3: CDP will release the securities and transfer the ownership to the new owner Step 4: Your broker will receive the money from the sale and will pass it to you. This could go into a cash account you keep with the broker, a cheque, or sent electronically to your bank account That is the sell process.

The Process of Buying and Selling Overseas Securities We have settled how buying and selling works for the securities listed on the Singapore Stock Exchange. What about a purchase of securities from an overseas exchange? Do check each of the brokers and what are the cost associated. From the above, it looks like the buy process we describe before, the only difference is: The order is placed no on SGX but on an overseas exchange such as NYSE, London Stock Exchange Step 3: When your order is filled, instead of the CDP account, the custodian is your broker, who may engage an external custodian service.

There are custodian charges and dividend handling charges that comes with it The sell process on overseas exchanges is also similar to the sell process for local exchange, with the difference being: Your main interaction will be with your broker. And your interaction will typically be: The process should roughly go like this: Open a brokerage account with a broker Open a local custodian account, the CDP account with your first broker Take a MAS Customer Knowledge Assessment Fill in W8Ben tax declaration form if you wish to trade in USA Wait for your account to be processed Upon receiving your account ID, password, pin, 2FA token, you can start trading, or buying and selling securities 1.

Open a brokerage account with a broker The most common way to open a brokerage account is to find the broker, print out the application form, and then to mail it. It is still rather primitive in Singapore unfortunately. The following links take you to the various sign up page of different brokers: Lim and Tan Philip Capital POEMS Kim Eng UOB Kay Hian DBS Vickers iOCBC Most of them will either ask you to go down to create an account or mail the forms in. You will need to fill in an application form.

And you will need to bring these documents and a few extras other than these: NRIC photo copy Existing CDP Account number if this is not the first time you are creating One of the following supporting documents: Bank Statement Income Tax Statement CPF Statement When you speak to the broker representative, you will be presented with a few options. Here are my recommendations: Apply for Internet Trading and Mobile Trading. Depend on which markets you wish to trade you might want to signed up for more than one stock exchange that is on offer.

I always signed up for the option to allow me to invest in USA shares. Link to your existing CDP account. If you do not have a CDP account, get the brokerage firm to help you create and link to one. Do a MAS Customer Knowledge Assessment Quiz There are some bureaucratic steps you need to do. What you need to know is Create an account at SGX Online Education Program. Fill up the Customer Account Review Form. The form will ask if you are trained in finance or in the finance field.

If you are not, you will need to take a test. You have to complete the whole e-learning course for about 1 hour. The test is not really very easy. It can be passed after going through it in detail. I failed the first round. Apply via DBS, OCBC, UOB ATM Singtel willing to sell Telkomsel according to Telkom Singapore Savings Bonds SSB to start issuing in September. Subscribe to Investment Moats to Level Up Your Wealth Management Today Join our mailing list to receive the latest news and updates from Kyith.

Trackbacks List of Singapore investment and REIT blogs I follow — Stocksologies. Investments, REITS, real estate. April 19, at 9: Leave a Reply Cancel reply Your email address will not be published. About Investment Moats Kyith Ng is the founder of Investment Moats, which mentors you on wealth management towards Financial Independence Investment Moats shows how you can build wealth through stock market investing, dividend income investing through a value based approach.

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