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Old 03-03-2015, 08:21 PM   #1
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Several questions from a newbie!

Hi, been reading threads in this stock subforum, have a few questions that I need some further explanations or advice!

I understand that most bro/sis here recommends IB or SCB for buying/selling.

Went to check out the sign up process for IB, i saw that one of the required item to prepare is employer details. May i ask if that is really necessary? I am actually not under any employment as i am still studying and i am under 26(for the lower startup cost). So can anyone confirm if that information is strictly needed?


I also understand that buying through both IB and SCB, the shares/stock is bought under their name, not under ours. I am interested in trying to invest part of my budget into direct shares purchase(e.g. coca cola, GE), which i found out mostly are based in USA through companies like computershare.

The question is,
-is it possible for us in Singapore to directly purchase these stocks? If possible, may i know how i can go about doing this? I see that a US social security number is required to register at sites for computershare(unless i missed something).
-are there any tax implications for such purchases?
-how do i go about paying in USD if i opt to do a monthly recurring investment for it, since through broker you can exchange a lump sum and use over time, but i am not sure how it works in this case of direct purchase.

How much(in %) of my budget would you advise me(or others younger people starting out) to invest in stocks for different market. I am currently thinking of 25% direct purchase(if possible), 25% US or other countries, 50% local, with most of them aiming for long term return(>10yrs).
Should i also try to invest in other things outside stocks such as bonds, FD/TD, insurance? I have not thought of these as i havent started reading more in depth about it.

Advise/help would be appreciated. Feel free to ask similar questions or your personal experience here too! Cheers!
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Old 03-03-2015, 09:12 PM   #2
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I will just touch on the scb part as I'm not familiar with IB yet.

Once you have a scb account, you can buy shares directly just by entering the ticker, example,
for coke, it's KO,
for apple, it's AAPL.
Enter the amount of shares, min 1, and
Enter the price you would pay for that share.
It's that simple. Don't bother about computershare.

For scb, there is no auto reinvest, you would need to have the discipline to do it yourself every month.

As for the percentage allocation, it's what you are comfortable with(vague, I know).
As long as you are not too overweight in 1 counter, you are safe. Of course, if you wanna go for the kill, be ready to take the heat.


Having a bit of bond is good too.
As for insurance, do not mix with investment.
Get a term policy and H&S. Also have a warchest ready for when the crash comes.

I think others will update you soon.
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Old 03-03-2015, 10:07 PM   #3
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Hi, been reading threads in this stock subforum, have a few questions that I need some further explanations or advice!

I understand that most bro/sis here recommends IB or SCB for buying/selling.

Went to check out the sign up process for IB, i saw that one of the required item to prepare is employer details. May i ask if that is really necessary? I am actually not under any employment as i am still studying and i am under 26(for the lower startup cost). So can anyone confirm if that information is strictly needed?

can just put self employed or not employed


I also understand that buying through both IB and SCB, the shares/stock is bought under their name, not under ours. I am interested in trying to invest part of my budget into direct shares purchase(e.g. coca cola, GE), which i found out mostly are based in USA through companies like computershare.

The question is,
-is it possible for us in Singapore to directly purchase these stocks? If possible, may i know how i can go about doing this? I see that a US social security number is required to register at sites for computershare(unless i missed something).

I think for non-americans, you cant, can double check with the broker if they provide such service or not

-are there any tax implications for such purchases?
-how do i go about paying in USD if i opt to do a monthly recurring investment for it, since through broker you can exchange a lump sum and use over time, but i am not sure how it works in this case of direct purchase.

How much(in %) of my budget would you advise me(or others younger people starting out) to invest in stocks for different market. I am currently thinking of 25% direct purchase(if possible), 25% US or other countries, 50% local, with most of them aiming for long term return(>10yrs).
Should i also try to invest in other things outside stocks such as bonds, FD/TD, insurance? I have not thought of these as i havent started reading more in depth about it.


if you can save 10% or more of your monthly income, you are already way above average. you seem new... maybe just start off investing in ETFs to get your feet wet first

as for cash and insurance

a general rule of thumb is to have at least 6-12 months expenses in cash/fixed deposits

and use around 5% of your income for insurance



Advise/help would be appreciated. Feel free to ask similar questions or your personal experience here too! Cheers!
see reply in bold

Last edited by felixleong; 03-03-2015 at 10:09 PM..
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Old 04-03-2015, 12:24 AM   #4
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Hi, been reading threads in this stock subforum, have a few questions that I need some further explanations or advice!

I understand that most bro/sis here recommends IB or SCB for buying/selling.

Went to check out the sign up process for IB, i saw that one of the required item to prepare is employer details. May i ask if that is really necessary? I am actually not under any employment as i am still studying and i am under 26(for the lower startup cost). So can anyone confirm if that information is strictly needed?
It's cool, you can just say "not employed". I think they just do that to evaluate you for margin lending or insider-trading risk, and neither of those are a problem for you.

I also understand that buying through both IB and SCB, the shares/stock is bought under their name, not under ours. I am interested in trying to invest part of my budget into direct shares purchase(e.g. coca cola, GE), which i found out mostly are based in USA through companies like computershare.
Don't bother. If the company does let you buy through their share registrar, it's going to be a gigantic pain in the arse to administer, because you have to have a bunch of separate accounts with a bunch of separate registrars and get a bunch of paperwork filled out. Just use Stanchart or IB.

In America, a group called the SIPC gives insurance automatically to your brokerage account. So even if your broker goes tits-up, you're insured for half a million dollars worth of stocks. You don't need to worry about directly investing; it's a huge pain for no gain.

How much(in %) of my budget would you advise me(or others younger people starting out) to invest in stocks for different market. I am currently thinking of 25% direct purchase(if possible), 25% US or other countries, 50% local, with most of them aiming for long term return(>10yrs).
Should i also try to invest in other things outside stocks such as bonds, FD/TD, insurance? I have not thought of these as i havent started reading more in depth about it.
Bonds: yes. My rule of thumb (that everyone on here is probably sick of hearing) is that you should invest "110 minus your age" into stocks - so, if you're 30 years old, you should invest 80% of your portfolio into stocks and the rest into bonds.

A35 is the best and only Singaporean bond ETF.

FD and TD - these aren't really investments. They're safe places to park cash that you'll need in less than a couple of years.

Insurance: insurance is not an investment. No way, no how. Endowments and whole-life plans and things like that are basically just expensive ways to invest in bond funds; and ILPs are just expensive ways to invest in unit trusts.

Last edited by Shiny Things; 04-03-2015 at 12:26 AM..
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Old 04-03-2015, 09:40 AM   #5
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@Perisher thanks for advice, will look into it!

@felixleong alright! didnt know that can put not employed as i didnt want to start out the application process only to be stopped by it in the situation i cant put that. And also i dont really have a steady income now(studying for a few more years), but i am working part time, and since i have no other liability for now(mortgage/loans etc etc), i am thinking of investing the extra income(low-mid hundreds a month depending on situation) instead of shelving them in FD.

@Shiny things Thanks for advice, already read about the 110%-age from your post in your "fan" thread! Not sure how bonds work yet(going to read up these few days/weeks first, not going to bother anyone for a quick explanation), will ask any questions about it again once i read it up).
About the direct purchase, i have read a few articles stating it is better to buy through direct purchase wherever possible as it is cheaper in the LR and you own the shares outright. From what you stated, it would not be any much cheaper for us in SG to buy through these process right? I cant really find any ways to ask those companies if it is possible to invest in this way from SG, as you need an account just to ask a question, and no email is provided(only a number for their US office). Will continue researching on direct share purchase as it seems to be slightly better for long term investing(assuming the process and cost is not as high as you stated).

Will update again with any questions in the future(still reading up on everything!), thanks for help so far! Will appreciate any further general advice for newcomers in investing!
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Old 04-03-2015, 09:50 AM   #6
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@Perisher thanks for advice, will look into it!

@felixleong alright! didnt know that can put not employed as i didnt want to start out the application process only to be stopped by it in the situation i cant put that. And also i dont really have a steady income now(studying for a few more years), but i am working part time, and since i have no other liability for now(mortgage/loans etc etc), i am thinking of investing the extra income(low-mid hundreds a month depending on situation) instead of shelving them in FD.

@Shiny things Thanks for advice, already read about the 110%-age from your post in your "fan" thread! Not sure how bonds work yet(going to read up these few days/weeks first, not going to bother anyone for a quick explanation), will ask any questions about it again once i read it up).
About the direct purchase, i have read a few articles stating it is better to buy through direct purchase wherever possible as it is cheaper in the LR and you own the shares outright. From what you stated, it would not be any much cheaper for us in SG to buy through these process right? I cant really find any ways to ask those companies if it is possible to invest in this way from SG, as you need an account just to ask a question, and no email is provided(only a number for their US office). Will continue researching on direct share purchase as it seems to be slightly better for long term investing(assuming the process and cost is not as high as you stated).

Will update again with any questions in the future(still reading up on everything!), thanks for help so far! Will appreciate any further general advice for newcomers in investing!
since u still new with limited capital

can consider starting off in the singapore market the blue chips or index first, US market is more complicated.. and u need to pass CAR

can also consider using blue chip investment plan, each month put 100-300 into the market also fine... the min comm $5 nia...
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Old 04-03-2015, 02:12 PM   #7
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alright afew quick question to clear some doubts before i continue reading up.

@felixleong you mentioned the CAR, checked it out. However, i cannot seem to find what it is exactly for and when it is needed to be filled up. Also, if i ever need to fill it up, but if i am still studying, do i put unemployed? And if i am in the midst of studying for my degree, do i put degree or maybe A level as my highest qualification? Appreciate some clarifications (:

i believe most recommend IB or SCB for their low commission rate(right?), i know that SCB holds the shares in a nominee account, may i know is it the same for IB? From some previous replies, i believe IB is used more for overseas market/trading with alot of funds, while SCB is more useful for local market/trading with lesser or limited funds, am i right to say this? Is there any other clear advantage to use any one of it over the other?
Also, is CDP account needed for both of them? (i would think yes, just a confirmation).
Should i also consider opening a broker account instead with higher commission so that the shares belongs to me? I read that it is troublesome to handle those monthly request for dividends and other issues with buying through SCB, is this true? or does it not really matter since im just going to buy in hundreds per month?
Also last question for now, i understand most singapore stocks are traded in lots of 1000 or 500. Is it the same if im buying through IB or SCB? is it possible to buy in lower amount?

EDIT: oops forget one more quick question, what is the main difference between stocks and bonds, cant seem to find an in depth explanation, would appreciate a quick explanation or a link leading to one!

Last edited by visualdream; 04-03-2015 at 02:15 PM..
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Old 04-03-2015, 02:30 PM   #8
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Stock means you buy into equity of a company. Means you own part of the company.

Bond is debt instrument. Meaning you are lending your money to the company. In return, you get a series of cash flows in the future.
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Old 04-03-2015, 02:37 PM   #9
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About the direct purchase, i have read a few articles stating it is better to buy through direct purchase wherever possible as it is cheaper in the LR and you own the shares outright. From what you stated, it would not be any much cheaper for us in SG to buy through these process right?
Direct share purchase is sort of a weird relic of the fifties. On the one hand, yes, dividend reinvestment programs are good, and they were sort of trendy for a few years back in the seventies and eighties. But that was back when brokerage regularly ran you $100 per trade for just a few thousand dollars of a blue-chip stock. Nowadays it's... a lot less. I pay a buck a trade and I still think that's too much.

These days, the rise of discount brokerage has made share purchase programs pretty much redundant. Pfizer's SPP, the most active one on Computershare's website, is actually more expensive than IBKR - $2.50 plus two cents a share on the buy side, and $15 plus twelve cents a share on the sell side. That adds up really fast, especially on the sell side.

And you have to go through the hassle of having accounts with every single company you want to own. We're not in the eighties any more. Go for Stanchart.

Other things:

i believe most recommend IB or SCB for their low commission rate(right?), i know that SCB holds the shares in a nominee account, may i know is it the same for IB?
Yes. All banks and brokers do this. CDP for Singaporean stocks is the exception, not the rule.

From some previous replies, i believe IB is used more for overseas market/trading with alot of funds, while SCB is more useful for local market/trading with lesser or limited funds, am i right to say this? Is there any other clear advantage to use any one of it over the other?
SCB's a little more expensive to trade, but IBKR charges a $10/month fee if you have less than $100k in your account. That's the tradeoff.

Also IBKR doesn't allow Singaporean residents to trade Singaporean stocks, for unspecified regulatory reasons.

Also, is CDP account needed for both of them? (i would think yes, just a confirmation).
Should i also consider opening a broker account instead with higher commission so that the shares belongs to me?
No, and no.

If you buy through Stanchart, or IBKR, or any other nominee broker, the shares still "belong to you". You own the shares. They're yours. It's just that Stanchart holds them in custody for you. It's exactly like holding cash in a bank account - the bank holds the cash, but you own it in every legal sense.

Also last question for now, i understand most singapore stocks are traded in lots of 1000 or 500. Is it the same if im buying through IB or SCB? is it possible to buy in lower amount?
1) If you're buying Singaporean stocks, no matter the broker, the lot size is generally 100.
2) If you're buying American or British stocks, no matter the broker, there is no lot size, which is good because you wouldn't want to have to trade BRK.A in clips of 100.
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Old 06-03-2015, 09:35 AM   #10
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alright thanks all so far! looks like im going for SCB for now!

Again for bonds vs stock, may i know what are examples of bonds? Still abit confused what is a bond or not. Also do i buy bonds and stocks at the same place? Are ETF considered stocks or bond? What makes it suitable for starters to start out with that first?


Can someone confirm this for me,

1.Go down to SCB to open an account
2. Wait afew days
3. Upon confirmation, i will be able to trade(after i transfer funds in)

Also, i went to check out the application form on SCB website, the CAR test is within the application form. However i realise that all the questions are a NO reply from me. Since i have not traded before, no qualification on finance, no diploma in those specific course, nor any work experience in investment. So does that mean that i fail the CAR test? How does it work?

Also, for the W8BEN form, do i fill it up there with guidance, or am i suppose to fill it up on my own? Sorry if this question sounds abit amatuer.

Thanks in advance!
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Old 06-03-2015, 10:20 AM   #11
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alright thanks all so far! looks like im going for SCB for now!

Again for bonds vs stock, may i know what are examples of bonds? Still abit confused what is a bond or not. Also do i buy bonds and stocks at the same place? Are ETF considered stocks or bond? What makes it suitable for starters to start out with that first?


Can someone confirm this for me,

1.Go down to SCB to open an account
2. Wait afew days
3. Upon confirmation, i will be able to trade(after i transfer funds in)

Also, i went to check out the application form on SCB website, the CAR test is within the application form. However i realise that all the questions are a NO reply from me. Since i have not traded before, no qualification on finance, no diploma in those specific course, nor any work experience in investment. So does that mean that i fail the CAR test? How does it work?

Also, for the W8BEN form, do i fill it up there with guidance, or am i suppose to fill it up on my own? Sorry if this question sounds abit amatuer.

Thanks in advance!
Yes, most people who never traded before, don't have any finance background is sure fail the CAR thing. Customer Account Review.
That's why you either open at a brokerage like OCBC, CIMB and made 6 trades or you just smoke through, i.e. say you have 'finance degree'.
You can fill it up there with guidance though scb's service ain't exactly that good.

Also, once you applied, it might take a week or two for the account to be ready. Again their service has room for improvement, but I'm talking from my experience 3 years ago, maybe it's better now.

As for bond, buying the bond ETF. A35, is just fine, don't worry too much about the 'is it stock or bond', it is a bond with stocks-like elements. I can explain further if you wanna know.

Last edited by Perisher; 06-03-2015 at 10:25 AM..
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Old 06-03-2015, 12:01 PM   #12
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Yes, most people who never traded before, don't have any finance background is sure fail the CAR thing. Customer Account Review.
That's why you either open at a brokerage like OCBC, CIMB and made 6 trades or you just smoke through, i.e. say you have 'finance degree'.
You can fill it up there with guidance though scb's service ain't exactly that good.

Also, once you applied, it might take a week or two for the account to be ready. Again their service has room for improvement, but I'm talking from my experience 3 years ago, maybe it's better now.

As for bond, buying the bond ETF. A35, is just fine, don't worry too much about the 'is it stock or bond', it is a bond with stocks-like elements. I can explain further if you wanna know.
Hi, would appreciate a further explanation! i guess you can explain here so other people who are not sure can learn too!

So based on what you said, I would not be able to create an account with SCB since i dont meet any of the criteria, doesnt that make it impossible for newcomer to join them? kinda weird if you ask me. I guess i will have to trade with other banks first(maybe OCBC, having some promotions now!). But one question, when they say fill in the last 6 trades, it means buy and sell, or just buying 6 times? in other words, what constitute a trade in the eye?
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Old 06-03-2015, 12:13 PM   #13
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Hi, would appreciate a further explanation! i guess you can explain here so other people who are not sure can learn too!

So based on what you said, I would not be able to create an account with SCB since i dont meet any of the criteria, doesnt that make it impossible for newcomer to join them? kinda weird if you ask me. I guess i will have to trade with other banks first(maybe OCBC, having some promotions now!). But one question, when they say fill in the last 6 trades, it means buy and sell, or just buying 6 times? in other words, what constitute a trade in the eye?
So here's how Bond etf A35 works

1) It holds bonds, government bonds and other stuff
Here's the holdings, it changes
http://www.nikkoam.com.sg/files/docu...e_holdings.pdf

2) It holds bond till maturity.
3) It gives out dividends annually.
4) It's listed on the SGX like a stock. So you can buy/sell anytime the market is open.
5) the volume is low a most people just buy to hold, not many sell.
6) this means the price is stable too.
7) Once a bond in it's holding mature, it will replace with another bonds. It doesn't even have to wait for bond to mature before adding more bonds.
8) so it's like you go to bank to open a FD, when it matures, you put into another FD, so on and so forth.

I'm not sure of the intricacy of how or when they replace the bond holdings.
So you see, it's like a stock because you can buy/sell A35 on the stock market, but it is a bond because it just holds bond to maturity and pays out interest annually. You do not need to do anything but hold it and get dividends every year, A35 doesn't have a maturity date, it is constantly add/replacing bonds like a bond ladder.

Lastly, Buy is 1 trade. Sell is 1 trade. Buy and Sell is 2 trade.
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Last edited by Perisher; 06-03-2015 at 02:02 PM..
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Old 06-03-2015, 12:15 PM   #14
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And yes, scb is about the only broker who is so 'weird' that almost no newbie can open an account with them. And go and open with other brokerages while the promotion is going on, if not the 6 trade can easily set u back $27+*6=$180 est.
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Old 06-03-2015, 01:22 PM   #15
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you can just ignore their silly criteria and write down 6 stocks. it's not like they can check
here : AAPL GOOGL AMZN FB YHOO TSLA

So based on what you said, I would not be able to create an account with SCB since i dont meet any of the criteria, doesnt that make it impossible for newcomer to join them? kinda weird if you ask me.
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