There's nothing particularly exciting in this. Other U.S. brokers available to residents of Singapore, notably Firstrade Securities, have offered commission free trading on U.S. securities for quite some time.Just received an email from TD Ameritrade, they'll be dropping commissions from 3 August. I have accounts in both IBKR and TDA, hopefully IBKR follows suit!
There's nothing particularly exciting in this. Other U.S. brokers available to residents of Singapore, notably Firstrade Securities, have offered commission free trading on U.S. securities for quite some time.
There are at least two outstanding problems with these offers. First, these zero U.S. commission U.S. brokers don't offer low cost ways to start and finish with Singapore dollars in Singapore. Second, most residents of Singapore shouldn't be mucking with U.S. listed securities due to the tax considerations.
I should also mention that the brokers still make money even when the commissions they charge you are zero. For example, they keep any/all exchange rebates when you provide liquidity. Moreover, they are not necessarily obliged to route orders in the way(s) you would like them routed for the best price.
There's nothing particularly exciting in this. Other U.S. brokers available to residents of Singapore, notably Firstrade Securities, have offered commission free trading on U.S. securities for quite some time.
There are at least two outstanding problems with these offers. First, these zero U.S. commission U.S. brokers don't offer low cost ways to start and finish with Singapore dollars in Singapore. Second, most residents of Singapore shouldn't be mucking with U.S. listed securities due to the tax considerations.
I should also mention that the brokers still make money even when the commissions they charge you are zero. For example, they keep any/all exchange rebates when you provide liquidity. Moreover, they are not necessarily obliged to route orders in the way(s) you would like them routed for the best price.
There's nothing particularly exciting in this. Other U.S. brokers available to residents of Singapore, notably Firstrade Securities, have offered commission free trading on U.S. securities for quite some time.
There are at least two outstanding problems with these offers. First, these zero U.S. commission U.S. brokers don't offer low cost ways to start and finish with Singapore dollars in Singapore. Second, most residents of Singapore shouldn't be mucking with U.S. listed securities due to the tax considerations.
I should also mention that the brokers still make money even when the commissions they charge you are zero. For example, they keep any/all exchange rebates when you provide liquidity. Moreover, they are not necessarily obliged to route orders in the way(s) you would like them routed for the best price.
Is tax considerations such big of a deal that residents of Singapore should totally avoid us listed securities? Sounds a bit extreme though.
What tax considerations are u referring to? As sg residents, there should be no tax unless ur talking about dividends but I don't think there's capital gain tax?
When the commissions is already zero, they can keep all rebates to themselves.
https://www.tdameritrade.com.sg/why-td-ameritrade/account-types-and-funding.html
Funds will normally be available in your account within 2 to 3 business days. Please note that this is for DBS/POSB bank account holders only.
https://www.tdameritrade.com.sg/why-td-ameritrade/pricing.html
https://www.tdameritrade.com.sg/faqs.html
DBS/POSB Electronic Transfer:
Funds will normally be available in your account within 2 to 3 business days. Please note that this is for DBS/POSB bank account holders only.
Received this from TDA yesterday:
The investing and trading experience you know and love is getting even better. Starting 3 August, you'll also enjoy:
$0 commission on online stock trades
$0 commission on online ETF trades
$0 commission on online options trades
(Contract fees now only USD$0.70, plus no assignment or exercise fees.)
Applies to U.S. exchange-listed stocks, ETFs, and options.
The change to zero commissions comes with zero change to the level of service you've come to expect. You still get unlimited free access to our best-in-class trading platforms. Plus, you get knowledgeable local support and helpful educational resources. Who says you can't get something for nothing?
Is tax considerations such big of a deal that residents of Singapore should totally avoid us listed securities? Sounds a bit extreme though.
U.S. dividend and U.S. estate taxes apply to most U.S. listed securities. Residents of Singapore (who are not U.S. persons) are non-favored and pay the 30% non-treaty dividend tax rate.What tax considerations are u referring to? As sg residents, there should be no tax unless ur talking about dividends but I don't think there's capital gain tax?
Yes.Regarding the order routing, does IBKR route orders better than TDA?
U.S. dividend and U.S. estate taxes apply to most U.S. listed securities. Residents of Singapore (who are not U.S. persons) are non-favored and pay the 30% non-treaty dividend tax rate.
I see, thanks, I buy stocks for the capital gain, dividend play is not my cup of teaU.S. dividend and U.S. estate taxes apply to most U.S. listed securities. Residents of Singapore (who are not U.S. persons) are non-favored and pay the 30% non-treaty dividend tax rate.
Yes.
Yep but if dividend isn’t really that much of a concern because the counter either doesn’t pay dividend or pay very little dividend and is really about capital gains and also up to 60k is exempted from estate tax, not really an outright no, no?
Nothing is free in this world, have to find out what is the alternative they are using to cover this commission cost.
It's been asked and answered many times in the US where the free trading trend started from. The earning mechanics are the same since TD is only allowing you to trade US for free so it makes sense why they can open it to non US residents too.yah. same. moi concern is not too long ago TD say $0 not for non-US resident. now why they policy shift and more importantly how they make money?
via increase bid/ask spread? via dividend handling?
Second, most residents of Singapore shouldn't be mucking with U.S. listed securities due to the tax considerations.
Correct. There are a couple fairly rare, exotic exceptions. I could see how direct holding of U.S. Treasuries might be occasionally useful, for example.I'm not sure I'm understanding this correctly. You're saying that 'most residents of Singapore' should not invest in 'US listed securities' - ie, any shares/bonds listed in the US?
That would be the implication of what I wrote if there were only two countries in the world with securities listings.So, according to you, just stick to buying SGX-listed 'securities' on local exchange?
There are many securities listed in the United Kingdom (London), for example.Or is there something I'm not understanding right, despite re-reading what you wrote several times?
Correct. There are a couple fairly rare, exotic exceptions. I could see how direct holding of U.S. Treasuries might be occasionally useful, for example.
That would be the implication of what I wrote if there were only two countries in the world with securities listings.
There are many securities listed in the United Kingdom (London), for example.
Hmm thanks for the info! I guess I'll stick to IBKR then. Regarding the order routing, does IBKR route orders better than TDA?
Agree with you on this. I try to maximise tax efficiency by having a bias towards stocks that don't pay dividends e.g. BRK.B, AMZN
No capital gains tax, but yes dividend-withholding as well as estate taxes.
I'm not sure I'm understanding this correctly. You're saying that 'most residents of Singapore' should not invest in 'US listed securities' - ie, any shares/bonds listed in the US? So, according to you, just stick to buying SGX-listed 'securities' on local exchange? Or is there something I'm not understanding right, despite re-reading what you wrote several times?
Is tax considerations such big of a deal that residents of Singapore should totally avoid us listed securities? Sounds a bit extreme though.