Interactive Brokers - SGD now available for funding - Part 2

[reddevil0728]

The application for vickers is simple. IDK about IBKR SG. Given your experience with it, is it complicated and a hassle to apply for an account?

I believe can use SingPass myinfo

If spic protection so important for you, I mentioned earlier if you get someone on ibkr us to refer you using the new promo they have, ur account should be with ibkr us, but then cannot trade SGX if you are ok with that

 

[xoleman]

I don’t see why is it false advertising?

They are correct to say that people are dealing with a brokerage that is “backed” by DBS, because vickers is a subsidiary of DBS. This isn’t false advertising. This is a fact.

But that sentence doesn’t mean your investment holdings with them is backed by DBS. In no way did they say that.

Am I right to say none of the brokerages operating in Singapore are truly backed by an entity? The only brokerages that does are incorporated in the US and insured by SIPC?

 

[reddevil0728]

Am I right to say none of the brokerages operating in Singapore are truly backed by an entity? The only brokerages that does are incorporated in the US and insured by SIPC?

You mean “insurance”?

 

[xoleman]

You mean “insurance”?

What I mean is brokerages from the 3 banks DBS, UOB and OCBC are not backed by the banks despite being subsidiaries. It is rather misleading operating under the bank names when their clients receive no protection from the banks.

 

[reddevil0728]

What I mean is brokerages from the 3 banks DBS, UOB and OCBC are not backed by the banks despite being subsidiaries. It is rather misleading operating under the bank names when their clients receive no protection from the banks.

I think you are conflating “backed” with “insurance”.

A bank cannot back itself that’s why there is SDIC for deposit in Singapore.

I don’t think it’s misleading but rather misunderstanding.

For SGX stocks those held on custody, I believe those local brokers have to have a separate account held with CDP. So is actually CDP that is “backing” it not the banks.

 

[streetfighter]

IB SG definitely less trustworthy than DBSV since latter fully owned by DBS. Remember MF Global? If you have cash deposited with MF Global, then they have been burnt to ashes, never get back. Who knows whether IB will be like MFG?

Where did you see that DBSV insures your securities???

The SDIC protection in Singapore only covers SGD cash deposits (not even any foreign cash deposits), not shares.

I don't think IBKR SG is less insured than most other local brokers.

 

[xoleman]

I think you are conflating “backed” with “insurance”.

A bank cannot back itself that’s why there is SDIC for deposit in Singapore.

I don’t think it’s misleading but rather misunderstanding.

For SGX stocks those held on custody, I believe those local brokers have to have a separate account held with CDP. So is actually CDP that is “backing” it not the banks.

If this is so, there is really no reason to use any of the brokerages affiliated with the 3 banks for foreign stocks and ETF except maybe convenience. The higher fees doesn't seem justified now after reading everything you wrote.

 

[ashethen]

thanks for the help..
I gotten a switch to RegT Margin account. Need to get familiar with all the figures under the Margins & Funds tab. Too many numbers

dont have to worry about those numbers if you buy within your funds you deposit. if you buy more than what you have or short then have to look at those numbers

 

[reddevil0728]

IB SG definitely less trustworthy than DBSV since latter fully owned by DBS. Remember MF Global? If you have cash deposited with MF Global, then they have been burnt to ashes, never get back. Who knows whether IB will be like MFG?

Then ibkr sg is also fully owned by IBKR which is a us listed entity. So not sure if that’s a fair comparison

 

[xoleman]

IB SG definitely less trustworthy than DBSV since latter fully owned by DBS. Remember MF Global? If you have cash deposited with MF Global, then they have been burnt to ashes, never get back. Who knows whether IB will be like MFG?

So is Vickers more heavily regulated by MAS since it is under DBS?

 

[reddevil0728]

If this is so, there is really no reason to use any of the brokerages affiliated with the 3 banks for foreign stocks and ETF except maybe convenience. The higher fees doesn't seem justified now after reading everything you wrote.

Perception of “banks being more robust” might sway some? But in reality there’s is no outright legal protection.

 

[reddevil0728]

So is Vickers more heavily regulated by MAS since it is under DBS?

I think all brokerage that operates in Singapore and subject to the same regulation even for ibkr sg

 

[xoleman]

Then ibkr sg is also fully owned by IBKR which is a us listed entity. So not sure if that’s a fair comparison

So even if something were to happen with IBKR SG, IBKR US would be taking responsibility for it right? Would singaporean investors be able to sue IBKR US if they refused?

 

[reddevil0728]

So even if something were to happen with IBKR SG, IBKR US would be taking responsibility for it right? Would singaporean investors be able to sue IBKR US if they refused?

That question can also be asked of dbsvickers.

If anything happen to dbsv, will dbs take responsibility?

Anybody can sued but whether will win or not is another matter. Same for the dbsv case.

 

[xoleman]

That question can also be asked of dbsvickers.

If anything happen to dbsv, will dbs take responsibility?

Anybody can sued but whether will win or not is another matter. Same for the dbsv case.

So MAS is just as powerless in this situation? Can they force DBS to pay?

 

[reddevil0728]

So MAS is just as powerless in this situation? Can they force DBS to pay?

We live in a country with the rule of law.

If there is no legal need for protection, there is no legal need protection. Why should MAS force dbs to pay when there is no law in place?

 

[crystalnox]

IB SG definitely less trustworthy than DBSV since latter fully owned by DBS. Remember MF Global? If you have cash deposited with MF Global, then they have been burnt to ashes, never get back. Who knows whether IB will be like MFG?

In a way you're right, DBS wouldn't let Vickers collapse just like how our govt wouldn't let DBS or SIA collapse.

It as though if I have 100% confidence in Vickers, it would be around 98% for IBKR in comparison. Still very high confidence, but lower regardless.

 

[reddevil0728]

In a way you're right, DBS wouldn't let Vickers collapse just like how our govt wouldn't let DBS or SIA collapse.

It as though if I have 100% confidence in Vickers, it would be around 98% for IBKR in comparison. Still very high confidence, but lower regardless.

It’s about perception. But not legal requirement.

 

[crystalnox]

It’s about perception. But not legal requirement.

Yup, nothing legally binding absolutely. I think for most of us here that are under a 7 digit networth, the trustworthiness of a local broker vs ibkr etc isn't worth taking into account yet. The chances of IBKR going the way of MF Global is exceedingly low.

One thing I might do if I ever get to a large enough portfolio, is to diversify brokers by shifting the "never to be touched" index fund portion into a "closer to home" broker like dbs just for peace of mind.

 

[RedsYWNA]

Can use SRS to trade foreign ETFs? You mean those listed in SGX right? Not on foreign exchange.

I thought for dbs multiplier, only cash/cash upfront is counted? SRS isn’t.

Yes, I mean those foreign ETF listed in SGX like S27, TID, HST etc.

Actually for DBS Multiplier, I had tried with CPF before a few mths ago. Its counted for the DBS Multiplier tier. Havent tried with SRS, but since CPF can, I am sure SRS can too. In fact, i read somewhere that SRS is eligible.....