Note: I’ve updated this guide to reflect the latest information as at 2020. Take a look at the 2020 guide here!
Stock Brokers have come a long way. From their heyday back in the 1980s, to their complete replacement by computers, it has truly been stunning to see how the rise of technology can destroy an entire profession.
I’ve touched on which stock broker to use in my previous articles here and here, but I did feel that new information has come to light that warranted an update. I do also get questions from readers occasionally on which stock broker they should be using, so given we’re nearing the end of 2018, it seemed a great time to do a definitive guide to the best stock broker for Singapore investors.
Basics: Stock Broker
Unlike in the US, we don’t have a service similar to Robinhood that offers free stock trading (would any Singapore startup like to do this?), so we’re stuck with paid services.
I will run through the brokers for Singapore, US, Hong Kong and UK shares.
CDP vs Custodian
For Singapore stocks, it’s important to first discuss the difference between a Central Depository (CDP) and a custodian system. With a CDP system, all stocks you buy will go into your CDP account, and you are viewed as the legal owner of the shares. The advantage is that because you’re the legal owner of the shares, the company views you as a shareholder, and you get benefits such as access to AGMs/EGMs, annual reports or circulars delivered to your home, timely receipt of other company notices etc.
With a custodian account, the stock broker owns the shares. So if you’re using UOB Kay Hian’s custodian service, the shares will be legally owned by UOB Kay Hian, and they hold the shares on trust for you. Advantages are usually lower fees.
I’m going to simplify things for you. Unless you have a very very strong reason why you need to use custodian services, and I really can’t think of one, do yourself a huge favour and just always pick a CDP service. I’ve been at many AGMs where shareholders from a custodian service have huge trouble trying to get in, simply because the company didn’t have records of them being a legal shareholder. It’s also tricky when you’re trying to receive company notices (eg. Notice of EGM, Distribution Reinvestment Plans, general offers etc), because sometimes there’s a delay in your custodian service sending these notices to you (sometimes you just don’t even get them).
Dollars and Sense did up a nice table below that compiles all the brokerage fees in Singapore.
DBS Vickers Cash Upfront is the winner here. At a 0.12% fee and a S$10 minimum commission, it’s amongst one of the lowest fees of all the brokers, and to top it all off, any shares you buy go straight into your CDP account. The difference with a Cash Upfront account is that you have to transfer the money into the account before you make the trade. A normal cash funded DBS Vickers account will use the standard T+3 settlement timeline, so it allows you to do contra trading. Personally I don’t do contra trading, so I don’t see any reason why I wouldn’t use the Cash Upfront option and save on fees.
Some readers have asked me for my thoughts on FSMOne, because the advantage is that while you pay similar commissions when buying shares, FSMOne is cheaper when it comes to selling shares, as you cannot use DBS Vickers Cash Upfront to sell shares (it goes through DBS Vickers, and minimum commission is S$25). Personally, my thinking is that for Singapore shares I will not use any custodian service (for the reasons set out above), so I will continue to stick with DBS Vickers Cash Upfront, given that it’s only a small increase in fees. Penny wise pound foolish here guys. Although if you’re a frequent trader and don’t hold long term positions, I can see why FSMOne may be attractive.
Winner: DBS Cash Upfront.
When researching this article I emailed DBS to ask for a special account opening bonus for readers of Financial Horse, but unfortunately nothing ever came back from them (thanks DBS). So you’re not going to get any free gift for opening with DBS Cash Upfront, but you will still save on the fees, and it’s still my pick for the best stock broker for Singapore shares. They do have occasional promotions, for example there was a S$5 rebate on trading fees a while back, so do check back from time to time.
US shares is where it gets complicated. There are 4 brokers that I would consider for US shares, and each has their own pros and cons, and would appeal to a different type of investor.
|Stockbroker||Saxo||Interactive Brokers||Standard Chartered Online Trading||FSM One|
|Fees||0.01 USD/share||USD 0.005 per share||0.25%||0.08%
|Minimum Commission||4.00||1.00||10||Min USD 8.80|
|Forex Spread||Decent (typically around 50 bps).||Good (I dont use it myself, but I hear the spreads are very close to interbank rates).||Poor (up to 100bps the last I checked).||Never used before|
|Annual Fee||0.12% of Assets
Based on 100,000 USD, this will be 120 USD a year. So 100,000 USD is the tipping point where it will make sense to move to Interactive Brokers. At closer to 200,000 USD, you can just get a priority banking account with Standard Chartered.
|We do not charge any account maintenance fee for any account that meets the following criteria:
· Greater than 100,000 USD in average equity for a calendar month or
· 10 USD in commissions generated in a calendar month.
Otherwise, 10 USD a month, totally 120 USD a year.
|Sign up Promo||Referral bonus available.||None||None.||None.|
|Customer Service||Good.||Never tried.||What you would expect from a bank.||Never tried.|
|Remarks||If you are Priority Banking, there is no minimum commission.
To qualify as a Priority Banking customer, an Eligible Customer must have successfully established a Priority Banking relationship with the Bank and maintain at least S$200,000 (or its equivalent in another currency) of assets under management with the Bank.
It’s quite a lot of information, so I’m going to summarise it here.
Saxo Markets offers a USD 4.00 minimum commission which is amazing. The forex spreads are also decent. But the drawback with Saxo, is the 0.12% annual custodian fee. I know that sounds like a lot, but there isn’t a minimum amount unlike some other brokerages, and to put things in perspective, if you’re investing US$10,000, that works out to 12 USD a year. The real kicker with Saxo though, is that on top of the low commissions, they’re offering a referral bonus if you’re referred by an existing client of Saxo. If you’re keen, Financial Horse has a special affiliate link with Saxo, check out the instructions at the end of this post.
Interactive Brokers offers a USD 1 minimum commission and good forex spreads, but the problem is that unless your total account value with Interactive Brokers is more than US$100,000, they will charge a minimum brokerage fee of USD 10 a month, less any brokerage fees that you incurred. This is actually very significant, because if your account value is low and you don’t trade often, that’s still a USD 120 you’re paying every year. So as good as Interactive Brokers is, I would only recommend it if you’re a frequent trader (so you hit the USD 10 commissions a month) or if you’re a high roller (account value more than US$100,000).
Standard Chartered used to be the number one choice back in the days when they had no minimum commission trading. They’re come a long way since, and these days its USD 10 minimum commission per trade, and the poor forex spreads remain. On the bright side though, there’s no custodian fees, but I don’t think this is sufficient to outweigh the other two points. Standard Chartered becomes attractive if you’re able to you’re able to hit priority banking status with them (S$200,000 held with Standard Chartered), at which point you get no minimum commission trading. So if you’re a priority banking customer, I would say go with them.
FSMOne is the new boy in town. They launched just last year (2017), and they have some really attractive fees at USD 8.80 minimum commission, and no custodian fees (for now). There are some other charges: USD50 to handle any corporate action (rights issue, general offer, spin-off) and a dividend handling fee of 1% of gross dividend subject to min USD 2.50 max USD 25 so do be aware of them. Unfortunately I don’t use FSMOne so I’m not able to comment on their forex spreads (leave a comment below if you do).
My main concern with FSMOne, is that unlike the other stock brokers on this list, FSMOne is a comparatively much smaller player, and their brokerage service only opened in 2017. As a long term buy and hold investor, I need my stock broker for foreign shares to be around for the next 10 to 20 years, and with someone like FSMOne, that’s not so clear. They could easily just decide the Singapore market is too small and unprofitable and close this service 2 years later, and I would be stuck with the hassle of trying to move all my shares to a new broker. So while I recognize the attractive fees on offer, I find it hard to recommend FSMOne as a primary broker. Of course, if you’re attractive by the fees and want to give it a try, please do go ahead.
For comparison though, just to illustrate how ludicrous some of the fees charged by the local brokers are, this is what is being charged by DBS Vickers for US shares.
Trading Fee: Minimum USD 25 or 0.18% of trading principal (whichever is higher)
Custodian Fee: SGD 2 per counter per month, capped at SGD 150.00 per quarter.
So yes, if you’re still using a DBS, OCBC, UOB or POEMs account to buy US shares, it really is time to switch to one of the above.
Winner: Saxo Markets
My winner for this category is Saxo Markets, because I think it is the most all rounded broker that would be most suitable for most readers out there. The minimum commission and forex spreads are attractive, and the AUM fee of 0.12% will scale accordingly with your account size because there is no minimum component. But if you’re a frequent trader or can hit US$100,000 shares in one account, go with Interactive brokers, and if you’re a Standard Chartered priority banking customer, use Standard Chartered.
|Saxo Markets||0.15% (min. 90 HKD)||0.12% Annual|
|Standard Chartered Online Trading||0.25%
Minimum $100 in HKD currency (HKD 107 with 7% GST)
|Interactive Brokers||0.08% of trade value(Min. HKD 18)||Minimum commission of 120 USD annually|
|FSM One||0.08% min HKD 50||None|
|DBS Vickers||0.18% on trading principal (min. HKD 100 for shares trading in HKD||Custody Fee
SGD 2 per counter per month, capped at SGD 150.00 per quarter.
|POEMS||0.25% (Min. 100 HKD)||SGD 2 per stock up to a max. of SGD 150 per quarter (7% GST applies)
Monthly charges are automatically waived if there are at least
(a) two trades in your trading account in the same calendar month, regardless of trade size in local or foreign shares OR
(b) six trades in your trading account in the same calendar quarter, regardless of trade size in local or foreign shares OR
(c) SGD 132 of paid brokerages in the same calendar quarter
From a pure commissions perspective, FSMOne is the cheapest of the lot. So if that’s all you care about, go with them. Personally though, I am concerned over the viability of FSMOne’s brokerage service over the long haul, so I will avoid them at least for the time being until they develop a longer track record.
That basically leaves me with Saxo and DBS Vickers. The minimum commission is HKD90 for Saxo, and HKD100 for DBS Vickers so it’s tied here. The crucial difference between the two, is the custodian fee of 0.12% for Saxo, versus SGD2 per counter for DBS. SGD2 per counter works out to S$24 a year (if you buy only one counter), which works out to SGD20,000 worth of stocks at Saxo at a 0.12% fee.
In other words, if you’re only buying 1 counter in Hong Kong, go with Saxo for investment sums below SGD20,000, and DBS Vickers for sums above. If you’re buying 2 or more counters, then Saxo becomes the obvious choice.
Winner: Saxo Markets
I’m going to award Saxo the winner here again, because it’s likely to be the most suitable choice for most readers out there. Although if all you care about are fees, FSMOne may be a good choice (subject to confirmation on their forex spreads).
I actually don’t know many investors who trade or invest in UK stocks, but I included them because of the popular trick of investing in the Irish domiciled S&P500 index funds to reduce withholding tax.
|Saxo Markets||0.10% (min. 8 GBP)||0.12% Annual|
|Standard Chartered Online Trading||0.25% (min. 10 GBP)||None.|
|Interactive Brokers||GBP 6.00 (up to 50,000 GBP)||Minimum commission of 120 USD annually|
|DBS Vickers||Minimum GBP 25; or 0.35% of trading principal (whichever is higher)||SGD 2 per counter per month, capped at SGD 150.00 per quarter.|
|POEMS||0.4% (min. 25 GBP)||SGD 2 per stock up to a max. of SGD 150 per quarter (7% GST applies)
Monthly charges are automatically waived if there are at least
(a) two trades in your trading account in the same calendar month, regardless of trade size in local or foreign shares OR
(b) six trades in your trading account in the same calendar quarter, regardless of trade size in local or foreign shares OR
(c) SGD 132 of paid brokerages in the same calendar quarter
It’s basically down to a fight between Saxo and Standard Chartered because of the minimum commissions (Saxo is 8 GBP, Standard Chartered is 10 GBP). The real clincher though, is that Standard Chartered has no custodian fee, which I think tips this heavily in their favour (and outweighs the poor forex spreads).
Winner: Standard Chartered Online Trading
How do I do it?
So here’s how I do it. I use DBS Vickers Cash Upfront for all my Singapore shares and REITs. I use Saxo Markets for all new money going into US and HK. I have existing US shares held via Standard Chartered Online Trading, so I will continue to maintain that account because it doesn’t make sense to incur the transaction fees to withdraw everything.
I currently don’t hold or plan to hold UK shares, but if I did, it would probably be either Standard Chartered Online Trading or Saxo Markets.
What is my recommended set-up?
If you’re a new investor, I know all this is a lot to take in. But if I had to do it all again, I would just open 2 brokerage accounts: DBS Vickers Cash Upfront for Singapore stocks, and Saxo Markets for foreign stocks. I truly think this combination would be the most suitable for most retail investors out there, unless you’re an accredited investor or high net worth individual.
Note: I’ve been getting a number of queries on why I don’t recommend Interactive Brokers for foreign shares, and the reason really is because of the minimum USD10 commission a month, which adds up to USD120 a year. This fee is only waived if you have more than USD100,000 with Interactive Brokers.
What I’ve found is that most Singapore investors are underallocated to foreign equities, and heavily overweight Singapore equities. Even for me, because a large part of my US shares are already held by Standard Chartered (it makes little sense to incur the transaction fees to move everything to Interactive Brokers), if I use Interactive Brokers as my broker going forward it’s still going to take a couple of years to build up to the USD100,000 mark, as I also invest heavily in Singapore shares. Whereas with Saxo, you’re actually getting a referral bonus just by making your first trade, and this money can be used to offset any future transaction fees. It just seems like a no brainer to me.
Saxo is my preference because of these reasons, but that said, if you are a high roller that can instantly pop USD100,000 into a new brokerage account, or you’re a frequent trader, definitely check out Interactive Brokers.
Financial Horse x Saxo Affiliate Link
If you’re keen on opening a Saxo account, Financial Horse has partnered with Saxo for a special promotion:
Financial Horse Affiliate Link for Saxo account
Note: If you’re running an adblocker you may be unable to view the link above, in which case you can use the alternative link here: Saxo Affiliate.
For the full details, drop me an email at [email protected] !
Picking the right brokerage is always important because every dollar of transaction cost saved, is effectively a dollar worth of investment returns. Which brokerage you ultimately pick depends greatly on your existing situation, and your investment sums. For example, if you have a Saxo Markets account and want to buy UK shares, it may not really be worth the hassle to open a Standard Chartered account just to save a little on fees. Or if you’re a priority banking customer with Standard Chartered, it makes a lot of sense to just use them for all of your shares. Or if you can maintain USD 100,000 with Interactive Brokers, they’re probably the best fit for you.
But for the average investor who has his net worth spread over real estate, cash, bonds, and other alternative investments, I think the above recommendations would serve decently well. Of course, don’t take my word for it, think through what works for you, what you plan to invest in in the coming years, and do some independent research, before picking a broker. At the end of the day, it’s just a broker, not a wife. If you pick wrongly, you can always switch ;).
Till next time, Financial Horse, signing out!
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The saxo platform is good. I’ve been using it for years. Deposits and withdrawals are all online and super fast. Platform is also updated frequently and there’s round the clock support online and over the phone as well.
Agreed. That’s been my experience thus far as well. Thanks for sharing!
hi may i know for saxo platform is there any expiry date for account?
None that I am aware of, for the account. There is a expiry date for referral promotion though, which ends some time in September, so do sign up soon if you’re keen. Drop an email to [email protected] for the next steps!
So if i would like to buy IWDA (on LSE but USD denominated), from your article i should be using SCB?
Both SCB and Saxo are perfectly acceptable. Go with the one that is more convenient for you. Don’t forget that Saxo has a referral bonus, which can tip the equation in favour of Saxo. 🙂
One qns. The DBS cashupfront account is only for Buy Trades. How then do i sell?
Sell via DBS Vickers. There’s a trick where you can transfer your shares to FSMOne for free, then sell via FSMOne (which is a custodian service). It definitely saves on fees, if you’re prepared to put up with the hasssle. 🙂
how to do so?
Hello there! What are you looking to do?
Why Interactive Broker not recommended for HK trades? 8 times cheaper than Saxo. Too much focus on sharing Saxo referral fees? Does one have unlimited the referral fees if we keep introducing new clients to Saxo ?
Hello there! Thanks for the comment! Yes IB is included in the table on HK brokers, but I didn’t recommend it because of the minimum monthly fee of 10 USD, that is only waived for accounts with over USD100,000. However my experience with most retail investors following this blog is that most of their non-Singapore portfolio does not come close to USD100,000, which makes it hard for me to recommend IB given the monthly fee.
Depending on your individual situation, if you’re able to ensure that your IB account balance is above USD100,000, then yes absolutely IB is the best choice.
Hope this clarifies. Cheers!:)
Yeah, that USD100k thing. Even though my IB account has permission to trade SGX, I don’t see myself reaching USD100K within 8 years (together with US and UK stocks that I intend to pick up). Unless i really increase the amount i allocate for stocks. However i need to keep some cash for downpayment incase i ever buy a property in SG.
So i got to incur USD120 x 8 years. Versus the lower costs if i stick with SCB. Seems like i should stick with SCB? Or should i look even further, and take into account the years that i will not need to pay IB fees once i hit USD100k?
Yes that’s exactly the issue with IB. My personal preference in such a case would be to stick with SCB. Money saved today is cash in your hands today, money saved tomorrow may or may not play out the way you imagine.
Hi Financial Horse, where is the link to open a referred Saxo accont?
It’s in the article itself. 🙂
Anyway, I’ve extracted it below for convenience:
This link will be hidden by Ad blockers. That’s why people can’t find it 🙂 Just FYI.
Very useful article btw.
Hahaha yeah I figured as much, thanks for pointing that out. For those who can’t access the link do drop an email to [email protected]
Thanks for raising this!
The $400 referral bonus means I get $400 in my account when I open an account and do the following?
“All you need to do is open an account via the link below (it’s via Singpass these days, which makes it very efficient), fund a minimum of S$3,000 and make 1 trade.”
Also want to ask, I have US shares in OCBC now. Would it be possible to transfer to SAXO? Any fees involved?
Just drop me an email at [email protected] for the full list of instructions on the referral bonus!
It’s possible to transfer shares, but OCBC will charge you a pretty exorbitant transfer fee. I really wouldn’t recommend doing it unless the dollar value of your US shares are very big.
Cheers! Happy 2019!
From what I read on the Interactive Brokers site, commission fees you pay for the stocks you buy are used to minus the 10 usd monthly. So if you paid 6 usd on commission by buying some stocks, you pay 4 usd for the account maintenance fee. Is my understanding correct?
Yes that’s absolutely right. So if you’re a heavy trader, IB is a good choice. You do need to take into account the 200 referral bonus for Saxo though, which can be quite powerful because its cash in your hands upfront. If you trade heavily or have a very large AUM, I would think IB edges out Saxo.
FH, what are your thoughts on 8 Securities?
You did not select Maybank Kim Eng for US market. I wonder why ?
I couldn’t find the link for the Saxo referral bonus
Hi just drop an email to [email protected] for the instructions!
Newbie here starting out on index/etf investing. Was just trying out on SC (purchasing IGIL) and realised something strange –
For UK markets, it looks there is a fee between 0.5% – 1% in addition to the 0.25% and then there’s the GST – all adding up to ~0.88%
Have you come across this before?
Hi there! Thats strange, I’ve definitely not seen this before. Able to share more details on what fee this is? Is it a percentage or is it a flat fee?
I would say that it’s a really good article for me. I have been looking and thinking to do international stock trading for quite a while.
At first it seems that my only choice was interactive broker. But I really dislike the monthly minimum fee or inactivity fee. So I’m thinking that I can probably do it via Singapore. This is why I found this article.
What i’m looking though is a broker that can give me access to a lot of capital markets in the world with acceptable fees model. Because I usually like to hold my shares for some of time.
Anyway I’m an Indonesian citizen. So can I also open an account in Saxo and get a referral bonus? Also with the trading of international stock, we will be reserved as the legal owner too right?
Yeah the problem with IB is the monthly fee, which is pretty annoying. Saxo is a custodian service, so they will be the legal owner, but you will be the beneficial owner (similar with any other custodian service). The difference in fees between custodian vs holding the shares in your name is pretty large, so I would personally still go with the former, and stick to a big big player like Saxo / IB.
Hello, what are the choices available to trade shanghai and shenzhen stocks?
Do you mean the onshore, A-Shares? They are not open to foreigners as far as I am aware. You will need an onshore brokerage account.
I am using a USD denominated account in Saxo Capital. I am currently investing US stocks… I would like to ask if it is wise to trade Hong Kong stocks with this? I am thinking there could be quite a number of foreign currency conversions?
SGD -> USD -> HKD
As opposed to if I am using a SGD denominated account…
SGD -> HKD
What are your thoughts on this.
Yeah, best to use SGD – HKD to minimise the forex losses. Cheers!
I came across this site just yesterday and must admit that I’ve learned a lot from reading your posts. You are doing a wonderful job. Thank you.
I have 2 questions:
1. I’m a Singapore resident. I have business income in USD in one of my US accounts, and would like to use that amount to invest in US market without converting to SGD. Similarly when I sell, I would like to withdraw the amount back to the US account. Which brokerages provide that option?
2. Some of my friends are using Citibank to invest in US markets. Why does Citibank not feature in your comparison for US markets?
Hi there, thanks for the support! On your questions:
1) You can try Saxo, Interactive Brokers or Standard Chartered. I believe they should have a function to transfer USD in directly. Do speak to the customer service officer for the exact steps on how to do this.
2) Citibank works, but the minimum commissions are high (25 USD minimum), so I would still prefer something like Saxo, IB, or SCB.
Hi, Many thanks for the useful website! Just wondering I made an application for the DBS Cash upfront acocunt as I am looking to invest in singaporean REITs in the futue. I live in UK currently and was wondering whether I also need to set up a CDP account? Also will I be exempt from dividend and capital taxes when investing in these REIT’s, the same as a singaporean local?
Yes, you will need a CDP account unfortunately. You just need to fill up the form and send it to CDP.
Technically if you are tax resident in the UK, you will need to comply with UK income tax and capital gains tax rules. Really depends on your personal situation though, and the amount of time you spend in the UK. Not saying that you should evade tax, but even if you are UK tax resident, it can also be hard for the UK tax authorities to know what income/capital gains you make on your Singapore shares. 😉
Thanks for the great article.
I am currently considering Saxo for my US Shares. Any tips on how to minimize the forex loss when funding your account? What’s your preferred way of funding? I saw in their website that bank transfer is only for SGD.
How’s your experience so far with Saxo after a year? What’s your thought on TD Ameritrade?
Hope you can grace me with your knowledge on this.
I usually just transfer SGD in, and let saxo automatically convert it into USD. The exchange rate isn’t the best around, but I think its worth the convenience, and as long as you dont transfer in and out too frequently the forex cost wouldn’t pile up.
HOpe this helps!
Thanks for the reply.
What’s your thought on TD Ameritrade with its flat fee of USD 10.65 per trade? Considering Saxo has custodian fee and market data fee that will pile up over the years if you’re not actively trading?
Great point actually, I should probably update this article to take into account TD Ameritrade. I think they’re good if your AUM is high, such that the USD10.65 minimum commission is worth the lack of a custodian fee. Don’t forget that Saxo has a welcome bonus now of around S$200 which can offset some of the fees.
As a rough ballpark, I would say if you plan to have total USD AUM of around or more than USD100,000, TD Ameritrade will become attractive as an alternative to IB (which is ridiculously complex and has no SG office) and Saxo.
I’ve never used their platform myself though, so I can’t comment on how easy it is to use or set up.
Hi. Thank you for the sharing. I just opened a DBS multi currency account for the purpose of trading in UsD stocks. My Saxo account’s base currency is in UsD. What do you think is the better option – buy UsD using DBS MCA and transfer into Saxo account or simply fund Saxo account with SGD for purchasing USD stocks?
Depends on the kind of forex spreads DBS is giving you. If DBS gives great spreads vs Saxo, and you’re transferring in large sums such that it’s worth the additional hassle of going vis DBS MCA, then absolutely go with DBS.
Personally I dont have much experience with DBS MCA, so I can’t comment much on their rates. A good way to check is to fund 1 SGD into Saxo to see the rates, and compare that vs Saxo.
Hope this helps!
Hi Financial Horse,
Great post and very insightful! I hope you don’t mind but I am quite new to investing so have some newbie queries:
1. From the little bits of research that I have done I think I would like to follow the Warren Buffet style of investing whereby I buy shares and hold them for extended periods of time. I recently created a Saxo account with the idea to invest in the US market. However I’ve hesitated to start as I’ve read that Saxo was a platform more suited to frequent traders & that there are fees involved should you hold a position or share for an extended period.
Would really like to get your advice on the above? Are there any brokers more suited to those who want to hold long term investments or is Saxo still the best choice?
2. Do you think now is a good time to be investing in the US stock market?
1. For US market, you’re really choosing between Saxo, Standard Chartered, and IB (maybe also Charles Schwab). If you have above S$100k, IB is the best in terms of fees, but their platform is horrible and customer service can be tricky because they don’t have a Singapore office. Charles Schwab is a good alternative to IB at that AUM range. If you’re below S$100k, I vastly prefer Saxo to Standard Chartered because the FX spreads and platform are better, as are the minimum fees. Of course, the downside with Saxo is the 0.12% platform fee, but with the S$200 referral bonus, that’s cash in your pocket up front to offset future fees, so it’s a good deal to me.
If you need a saxo referral just drop an email to [email protected] for the next steps.
2. Personally, I would wait to see the trade war play out over the next few months. Of course, it always depends on your investment timeframe and objectives.
Hope this helps!
Hi Financial Horse, thanks for the great article on the various markets. Just wondering what’s your take on best brokerage account for Malaysian markets?
Hi there! Unfortunately I don’t follow the Malaysian markets closely so I don’t have a ready answer for this. I’ll look into this for a future article!
Dear Financial Horse,
Saxo launched a simplified platform, SaxoInvestor.
As for pricing wise, there seems to be no difference to its main product, SaxoTraderGo.
However, its products are limited to Stocks, Bonds, ETFS and Mutual Funds.
(and im assuming the market exposure are the same between these 2 platforms)
Which would you recommend?
P.S. I’m quite enticed by your referral link for the SaxoTraderGO account.
Yet I am not knowledgeable enough to tap on other products like CFD, Options, etc.
Would you be asking for referral link for the SaxoInvestor platform?
Hi there! Isn’t SaxoInvestor part of the same suite of products offered by Saxo? Ie. If you open a Saxo account, you automatically get access to SaxoInvestor and/or SaxoTraderGo, and you can use either of them to buy shares.
So you can sign up via the usual referral link, and with your saxo account you use it only to buy stocks on SaxoInvestor. That should qualify for the referral bonus as well.
To me though, both platforms are exactly the same, it’s just a different packaging. If you’re using them say to buy a S&P500 ETF, it doesnt make a difference which one you use since fees are the same.
If you need the steps, just drop an email to [email protected]
Hope this helps!
Hi, after funding SGD into saxo, when i place an order for US stocks, saxo will auto convert my sgd to USD, right? I do not have to maintain a USD-denominated account (unlike stan chart)?
Yep, that’s absolutely right. If you open an SGD account, Saxo will automatically convert it into USD when you place an order to buy USD shares.
Hi can update your article with LG,TD amitrade.
Also, include for Malaysia,Indonesia, Vietnam,korea, and Thai stocks
Interesting, will take a look. Cheers.
As a beginner, I have a few questions.
1. Why is Saxo account required? As far as I know I can buy US stock with DBS Vickers, with multi-currency account.
2. Unlike SG stocks, US ones are not help in CDP account right? then where are they held?
3. I noticed that some US ETFs can be bought on LSE or ASX, in gbp or aud. Would it be better to buy them there, in terms of withholding tax?
Hope you can clarify, thank you 🙂
Hi! Welcome to Financial Horse!
1. DBS Vickers has significantly higher fees, minimum 25 USD per trade and custodian fees every month.
2. They are either held via a custodian account (eg. Saxo) or in your name but you incur additional fees (eg. DBS Vickers)
3. Yeah, usually best to go with Irish domiciled funds listed on the LSE to reduce withholding tax. There’s a bit of nuance to this though because you need to check the fund structure, but this rule is generally true.
Hope this helps! 🙂
That does help, thanks! Great website btw 🙂
Would you recommend converting SGD to USD myself before depositing into Saxo Capital Markets if I’m only purchasing US stocks? Would this save on forex losses?
Also, I am currently dabbling in options trading, planning to trade about once a month or so. With trading costs of 3.25USD, do you think the fees would eat too much into my profits?
It depends on the kind of forex spreads you can get from your bank. If they’re fantastic, and you’re investing large sums, go for it! Personally for me I can’t be bothered with the extra work haha, so I just use the rates that Saxo gives me, which aren’t fantastic, but still acceptable.
Also, any thoughts on the recent DBS Multi-Currency Account?
I haven’t used it myself, but I hear really good things about it (and I heard the FX spreads are good). Definitely worth checking out.
Hi, Thank you for the insightful comparison. I am looking to use SAXO to buy and hold ETFs from LSE which are domiciled in Ireland, such as the IWDA.
1) Do I open Saxo account with USD or GBP currency? From my understanding, the ETFs I’m interested in (such as the IWDA) are traded in USD and hence I think it should be a USD account.
2) If I purchase IWDA, am I subjected to the USD 3.99 or GBP 8 minimum commission?
3) I’m curious to know what does it mean to opt for a particular currency account. Is it correct to say that if I opened a USD account, I can fund it with any currencies to make a purchase (which would then be converted to the currency of the ETF). But when I sell, the money will be always be converted back to USD?
Thank your for your help
Replies below! If you need a Saxo Referral just let me know, drop an email to [email protected] for the next steps. 🙂
1) Up to you really. It can be SGD as well for convenience. But if you want full control over your forex, and you only plan on buying only the USD denominated shares, go with USD.
2) That’s a really good question. I suspect its the GBP 8, but I could be wrong.
3) Yep, that’s correct. The main currency account is what the sale proceeds or deposits will be converted into, to be deposited into that account. So try to keep it to the currency you’ll be trading in most often, to minimise forex. 🙂
Hi! One of the conditions in the Saxo referral promotion terms and condition is:
The Referred Client executes at least three (3) trades on margin products on the trading account within the Promotional Period.
Any idea what are margin products?
Hi! I suspect that it’s what it say, an actual margin product. If you need a referral you can use the Financial Horse one, you just need to make 1 trade of anything (equities or bonds is fine).
Hi! Thanks for the sharing! Saxo seems pretty good. However, just want to check if you have any idea if they have any inactivity fees ? Thought inactivity fees could affect buy-and-hold investors like myself.
Thanks in advance!
Hi! Thanks for your sharing. Saxo seems pretty good. However, just wondering if you have any idea whether there is any inactivity fees? Thought that could affect buy-and-hold investors like myself.
Thanks in advance!
Hi! Thanks for the sharing! Saxo seems good!
Would like to ask if there is any inactivity fee for Saxo? Also, is the 0.12% fee subject to any minimum amount ?
Nope, there is no inactivity fee, it has been waived by Saxo (the website might not be updated). No minimum amount on the 0.12% fee. 🙂
Hi, Thanks for Sharing
can i say that no matter which market we choose, as long as the objective is to hold the stock for long term, then SCB is always the best solution because of no custodian fee?
or is there any other additional fee if we buy mutual fund/ETF annually?
With SCB you’re paying larger transaction fees upfront, and you take a hit on the forex spread. So if you plan to do a lump sum investment into one or two stocks, and hold them for say 20 years, SCB is good cause of no custodian fee (but do note that they may change this in future).
But if you plan to do something like dollar cost average, Saxo is better because of the lower transaction fees, and lower forex spreads.
Not sure if this it’s updated but according to Saxo’s website (https://www.home.saxo/en-sg/rates-and-conditions/equities-and-etfs/commissions) the fees for SG stocks are 0.08% (min. SGD 10) with no custody fees which is even better than DBS Vickers fees!
Regardless of fees though, do you think it’s okay if I just stick to Saxo for both US and SG stocks for the convenience, with the tradeoff of not having the SG stocks in my CDP account? (I am not interested in attending AGMS :))
Yep that’s correct. It’s the same as DBS Vickers Cash upfront (for buy trades), but of course, Saxo will be cheaper for a sale because you can’t use cash upfront to sell.
Absolutely, you can use Saxo for both US and SG shares, as long as you’re fine with the custodian service (tricky to attend AGMs). I’m planning to write an article on this the coming week!
Will I be able to get a referral from you if I am not a Singaporean citizen? Thanks in advance.
Yep that should be fine, as long as you go through the link. Drop an email to [email protected] for the next steps!
[…] actually went into detail to compare SAXO and other broker account which you can find here. Meanwhile if you are lazy, I will just show you the costs SAXO charge per […]
Hi FH, I jus opened a saxo account. Am planning to invest in HK and US stock markets. I opted for Sg currency. Is it better? Am a bit confused on the implications of the currency I choose.
Hi 🙂 Great question! SG currency is more convenient for funding, so it’s generally good for Singapore investors as a base currency. You can see the funding instructions here. https://www.home.saxo/en-sg/legal/funding-instructions/saxo-funding-instructions
The USD account is good if you want to trade primarily USD stocks, but if you’re using it to trade non-USD shares, or if you plan to hold shares long term (instead of flipping them), the SGD account works perfectly fine (possibly even better). In this regard, if you’re trading more than one currency (e.g. USD and HKD), best to use SGD as the base currency, to minimise forex losses.
Hi FH, amazing web you have!
I have question with regards to subscribing to market data.
It is a must to subscribe as it is going to eat into the cost of investing?
I am trying to build a portfolio(SGD1000/monthly) using ETF(3-4 counters) listed on the US stock market
Nah I would say it’s not worth it unless you’re a professional trader. The free information (or what you get from SGX / Yahoo Finance) is more than good enough.
[…] 記事：Best Stock Brokers for Singapore Investors (2018/2019 Guide) […]
First of all, fine site you have here, with lots of great relevant details nicely laid out. Kudos for doing such good work, I hope you benefit from it – I will certainly recommend your site.
I have recently been caught up in the Schwab Singapore office closing (announced two days ago). Now I am working double time to find an alternative as there is less than two months before Schwab effectively shuts down.
My situation is I am a non-US expat, living in Thailand. My portfolio would be in excess of $400K USD
I found your site while investigating options. The list of potential candidates I have now is: (in no order) Firstrade, TD Amer, IB, Schwab HK, SC, Zacks Trade, Fidelity US, Saxo, FSBOne.
As of now I have spoken to:
– Schwab HK, would be easiest you think, but today they do not accept Thai based clients, and said if I wanted to move, I would have to sell al my positions and transfer in cash – nightmare as I have 20+ positions, many with covered calls written on them. They are still working on a solution and said they would update me.
– TD Ameritrade Singapore. They said they do not accept Thai based clients now, and that they are working to get that permission, but it would take a minimum of a few months – so in that case I time out.
– SC Singapore. Called the Priority banking line. The service was incredibly poor. They could give me no details on the account structure, fees, Thai residents allowed, etc – just kept asking if I had a passport. Left it with if I wanted info I need to set up an appointment for a call back (fair enough I guess, if someone with knowledge calls)
Those are all the calls I have made today. But disappointed as absed on your site, SC should for me be a top option, so see what happens. Now will contact IB to see what they have to say.
Cheers for all the great work you do. If any other readers out there are in the same position as me, be great to get more feedback.
BTW I also have a DBS Vickers account (and a retail account) but I find the fees quite high and they do let you do any option trading so I keep some buy and hold dividend paying stocks there, but the lack of trading options and costs (for US/Canada markets)makes them less attractive.
Hi! Thanks for the kind words, glad it’s been helpful for you!
That’s a really interesting situation you have there,although it might be slightly tricky as you rightly pointed out.
With the kind of amounts you’re investing, I actually think SCB Singapore or IB could be quite attractive. Moving your shares is going to be tricky though, so the best way is to speak to their customer service. Off the top of my head, I actually think SCB might be the best bet, if you can get through to someone who knows their stuff. Don’t give up on SCB just yet! xD
FH, Thanks for your thoughts.
The weekend has passed and I am down to a short list, and kept SCB on for now, see if they contact me in the next few days – as i already asked for a call using their online feature.
Saxo is on my short list as well, so I will use your referral option if it turns out they come out on top.
All the best!
Good luck! Hope all goes well! 🙂
Thanks FH for this very good article.
You often use the argument of minimum 10$ per month on commission as a disadvantage for IB compared to SAXO… but if you look at it from a different angle, it only takes 3 trades a month to be cheaper with IB (still 10$ monthly) than SAXO (3×3.99$), and I’m not adding the higher cost per share from SAXO. Also, when you have a rather small portfolio (<100k) the impact of 3.99$ + (0.01$ per share) with SAXO on small trade is higher than with IB.
So, SAXO is better than IB ONLY IF you do less than 3 trades per month… and I know several small portfolio investors who do more than that.
Regarding the referral program, do I understand well that you have to do 3 trades on margin ? If that's the case, you'll rapidly loose that money on the interest they charge for it. So, be careful when considering this option… one trick, do buy on margin small amount of shares and sell them soon after 😉
Keep up the good job !
Hi, thanks for the great analysis!
I have a separate referral program with Saxo, that only requires 1 ordinary trade. So it does not need to be a margin trade, you can nsimply buy a share with normal financing.
Really good point on the IB transaction fee though. I wrote the article more from the perpective of a longer term buy and hold investor, but if you are an active trade with more than 3 trades a month, IB actually is a pretty good choice. That said, I’ve heard (and encountered) a lot of problems with IB’s platform, so I’m actually quite wary of recommending it to beginner investors. Saxo’s platform and customer service is comparatively far more user friendly.
SCB now has pretty decent FX rates with liveFX – about 30-40 basis points for USD/SGD
Back to SCB then? Hahaha… 😉
I have saxo trading account, but I intend to buy SG REITS. I am aware that sg reits will have dividend payouts
regardless of how well/bad the company is doing.
But recently I heard from a friend that it is not recommended to use saxo to buy sg reits because saxo categorise sg reits under CFDs, and I won’t receive dividends payout at all? How is this possible and where will the dividends go then?
Is this true? Please advise.
Should not be true. It sounds like your friend may have bought a CFD by mistake, instead of the underlying share. Best to doublecheck what you’re buying when keying in the buy order, and check with Saxo to confirm.
But, while buying USD stocks from using SGD account, they charge 0.75% of conversion fee which comes to a big amount. So, it’s wise to open an USD account if buying only US stocks.
I actually just made a USD purchase using a SGD account, and the FX rate given to me was incredibly close to the interbank. So quite pleased with the spread actually. But yes, absolutely understand where you’re coming from on the USD account.
Hi, I am new on this blog but am intrigued by your work. Just a quick introduction about myself, I am 23 and took advantage of the financial downturn to start investing. I am currently investing with Etoro which allows Singaporean to trade US stocks. The downside is obviously the 30% withholding tax but I also realize that the conversion rate from SGD to USD is quite off.
Upon further research, I found out that there is a PIPS system (something like 200 PIPS) where it works out to be extremely disadvantageous for us. On a mere $500 conversion, i paid close to $25 of conversion fees which was ludicrous.
I would like to take your advice on the matter. 1) Is it only this particular broker that is charging ridiculous fees or are the conversion rates suppose to eat into your profits like that. 2) Do the conversion rate PIPS work in our favour when converting back into SGD? If so, can it be considered that the amount I paid converting to USD will be covered when i convert back to SGD and withdrawn? Thanks
Welcome to Financial Horse! My thoughts below:
1) No, all brokers charge some form of fees, as we summarised in the article above. It’s about picking the broker that works the best for you.
2) No, there is usually a spread on FX, so you pay the spread both ways. But it really varies from broker to broker. Some offer good rates on USD to SGD (no spread), but charge spreads for SGD to USD. It really depends on your broker.
Just think of your broker like a Raffles Place moneychanger – they need to earn some commission each time you change the FX.