Before you open a brokerage account, you need to choose a brokerage firm. Singapore brokerage firms are practically similar in the fees they charge and the facilities they provide. But there are still some small differences such as ease of using trading platforms and level of support that may tip the scales in favor of one particular brokerage for you.
So before we go into the means of setting up a brokerage account in Singapore, here are some interesting points:
What to consider when opening a brokerage account
Choosing a Brokerage
The kind of brokerage account you choose will determine your available options and the level of service you receive.
There are two types of stockbrokers:
- Full-service brokers- These are brokers who work closely with you, answer your phone calls and questions, place your trades for you, and even propose investments. They may also be able to give you access to limited, institutional-grade funds you otherwise might not be able to access. Full-service brokers charge you a commission for their services, making this option a little expensive.
- A discount broker- A discount broker, in contrast, provides you with the means to execute your own trades. You handle the trade orders and there will be no one standing between you and your money, which can be convenient if you’re in a hurry.
Some brokerage firms offer both traditional and discount brokerage accounts to investors, allowing them to select which type works better.
Margin Account vs. Cash Account
In addition to types of brokerages, there are two types of accounts you can hold at a brokerage. These are margin accounts and cash accounts.
Margin accounts let you borrow money in order to make a trade while Cash accounts expect you to have the amount of the trade available in cash before you make the trade. Buying stock on margin opens you to risk and if you are going to trade on margin, you may want to see how the brokerage account structures its margin terms and the rates at which margin loans are extended.
Brokerage Account Minimums
Different brokerage accounts have different opening-balance requirements. In Singapore, some brokerage firms will set a minimum at $50,000 or more.
Will You Use the Application (App) or Website?
If you plan on doing your trading online, make certain to visit the website of the brokerages you’re considering. The feel and usability of the site will be almost as important as the other advantages and services offered.
If you’re more of an app user, be certain the brokerage’s application works with your device and that it is convenient to utilize.
What to Expect After Opening Your Brokerage Account
Once you’ve opened your account, you can expect to begin receiving account statements. You can also view your brokerage account trade confirmations, which allows you to make sure the trades are being carried out as you wanted, and it gives you a chance to rectify any errors if they occur.
It is also possible for foreign investors to open a Singapore brokerage account by post. You will need to check the conditions with the firm you want to use, but approximately the key step is usually to have all the account opening forms and duplicates of your identification documents authorized by a lawyer.
Opening a brokerage account is the initial step you need to take to begin investing and buying stocks in Singapore because you can’t trade without one, So we hope this guide gives you some clear directions on how to open a brokerage account in Singapore.
If you have any more questions on how to open a brokerage account in Singapore, contact your Damalion expert now.
