Official Shiny Things thread—Part III

[Han Shot First]

I think all commission free trades including IBKR lite, they will route you through HFT, so you don't get the best trades. I suspect TD will do the same.

If a retail investor (not trader) uses limit orders and does not day trade, would HFT make any adverse effect to a buy or sell transaction?

 

[crystalnox]

Does TD also do spot fx conversions from SGD like IBKR or is there some sort of spread built in?

 

[crystalnox]

I think all commission free trades including IBKR lite, they will route you through HFT, so you don't get the best trades. I suspect TD will do the same.

Yup you're right, it's entirely up to them where they wish to route LITE orders.
https://gdcdyn.interactivebrokers.com/Universal/servlet/Registration_v2.formSampleView?formdb=3074

 

[swan02]

Ah, in actual fact I was expressing the same thing. I guess I have trouble putting message across, unable to portray an idea as succinctly as you do. Oh well, I think I need to put my blog on hold until I write better.

Thanks regarding about AUD. I guess I have to recall what I've learnt. *takes out 20 year old derivatives textbook*. Time to put into real practice.

I'd actually disagree with this. When it comes to personal financial planning, the question is not maximising risk-adjusted returns (or Sharpe, or whatever your preferred ratio is); the question is "what do you want to achieve? and what's the lowest-risk way to get that?".

 

[swan02]

Were you only able to trade USA domiciled stocks ?, ie. no ireland domiciled etfs like iwda ?

Definitely! I used to use IBKR for trading and have small position in TDA which I don't touch just for the free real-time data. Now I'm considering transferring my stocks over but I'm not sure if it's worth the hassle.

 

[_dXter]

If a retail investor (not trader) uses limit orders and does not day trade, would HFT make any adverse effect to a buy or sell transaction?

I have not used a commission free trader before. That said I had been using TD for trading this year since I have cash sitting in there. Often the prices I get for buy orders do not hit the limit I put. Indicating some sort of savings I get from TD best routing?

From next week when they moved to commission trade, we shall see perhaps?

 

[Eneguy]

Were you only able to trade USA domiciled stocks ?, ie. no ireland domiciled etfs like iwda ?

Yup, only US domiciled stocks and ETFs. I use it to buy and hold US stocks with no dividends.

 

[5408854088]

NOPE.

In bond-land, "high yield" is a euphemism for what the rest of the world calls "junk" bonds. These have higher yields because they're risky. These come from companies that are at greater risk of not repaying their debt.

This one is particularly gross because a) the bonds are denominated in USD, so you have FX risk; and b) because the issuers of these bonds are mostly emerging-market companies, not borrowing in their local currency, so you have an extra exciting slug of FX risk: if the companies' local currency does a 1997-style swan dive, the companies will have trouble repaying the bonds.

A very small allocation to high-yield bonds is OK if you have a large portfolio, but most people don't need it, and this is not the right way to get it.

thanks for your thoughts!

 

[BBCWatcher]

If a retail investor (not trader) uses limit orders and does not day trade, would HFT make any adverse effect to a buy or sell transaction?

Probably not.

Does TD also do spot fx conversions from SGD like IBKR or is there some sort of spread built in?

TD Ameritrade itself deals strictly in U.S. dollars. Interactive Brokers also happens to be a big and super efficient forex broker, which is quite helpful when you're starting and/or finishing with another currency IB supports.

 

[livingcharsiew]

Probably not.


TD Ameritrade itself deals strictly in U.S. dollars. Interactive Brokers also happens to be a big and super efficient forex broker, which is quite helpful when you're starting and/or finishing with another currency IB supports.

https://www.tdameritrade.com.sg/why-td-ameritrade/account-types-and-funding.html

TD can fund in SGD, exchange rate I don't know but if its the same as DBS retail rates its about 0.7%

 

[BBCWatcher]

TD can fund in SGD, exchange rate I don't know but if its the same as DBS retail rates its about 0.7%

What I wrote is correct, and I wrote it carefully. You cannot keep Singapore dollars on deposit at TD Ameritrade. Yes, DBS converts your Singapore dollars to U.S. dollars in that process, and that won't be a great exchange rate.

Schwab offers the same thing, except not limited to DBS as the sending bank. They have a local account in Singapore (at Citibank) that can receive incoming Singapore dollars that immediately appear in your Schwab account as U.S. dollars. Schwab itself does not deal in Singapore dollars, and you cannot keep Singapore dollars in a Schwab account. (Schwab stopped handling accounts for residents of Singapore, possibly with a few exceptions involving U.S. persons. But they still offer a local account number at a bank in Singapore -- and in several other countries -- for fund acceptance convenience only.)

Fidelity is another U.S. broker that offers the same service: a "postbox" local account merely for fund acceptance. Same deal: the funds are instantly converted to U.S. dollars and credited to your Fidelity account. Fidelity itself deals only in U.S. dollars. There's no multi-currency aspect to their accounts. The cash is one line only: U.S. dollars. Fidelity does not generally accept residents of Singapore as account holders.

 

[swan02]

I've just had a conversation with IB online customer service.

1. They allow you to create two accounts. i.e. one LLC, and the other SG. Do note join account SG is not yet available.

2. Someone did mentioned not long ago that LLC will be forced into SG eventually ..perhaps by the end of the year..........

however, today, the IB service staff says, that was the initial plan, but now they have decided NOT TO FORCE the conversion.

3. Lastly, if you open an account SG, and let say migrate to Aus, you would have to create an SG AUS account, and a different protection regulation exists.

 

[Kaypohji]

If create two accounts, meaning monthly 10$ on each account? 100k usd to waive off will also be on a per account basis ?

I've just had a conversation with IB online customer service.

1. They allow you to create two accounts. i.e. one LLC, and the other SG. Do note join account SG is not yet available.

2. Someone did mentioned not long ago that LLC will be forced into SG eventually ..perhaps by the end of the year..........

however, today, the IB service staff says, that was the initial plan, but now they have decided NOT TO FORCE the conversion.

3. Lastly, if you open an account SG, and let say migrate to Aus, you would have to create an SG AUS account, and a different protection regulation exists.

 

[swan02]

Well previously I had two LLC accounts. They are considered "LINKED". If they are linked, you still have 2x USD10=USD20. But if overall asset is =>USD 100k, its waived. Furthermore, if you incur fees on one account let say USD20, then both accounts maintenance fee is waived.

If you incurred USD 30 transaction fees, then you pay USD10.

.....................................

But the real question is.... is LLC a/c and SG a/c considered LINKED ???

sorry I didn't ask, but I would assume no from the way the IB staff seem to describe the structural set up.

If create two accounts, meaning monthly 10$ on each account? 100k usd to waive off will also be on a per account basis ?

 

[crystalnox]

Well previously I had two LLC accounts. They are considered "LINKED". If they are linked, you still have 2x USD10=USD20. But if overall asset is =>USD 100k, its waived. Furthermore, if you incur fees on one account let say USD20, then both accounts maintenance fee is waived.

If you incurred USD 30 transaction fees, then you pay USD10.

.....................................

But the real question is.... is LLC a/c and SG a/c considered LINKED ???

sorry I didn't ask, but I would assume no from the way the IB staff seem to describe the structural set up.

That's good to know, so there's a chance we can have both accounts and not have to pay USD10 as long as the total sum across both are >USD100K, instead of needed USD100K x2.

 

[swan02]

That's good to know, so there's a chance we can have both accounts and not have to pay USD10 as long as the total sum across both are >USD100K, instead of needed USD100K x2.

umm that’s not what I meant. It is likely the LLC and SG accounts CANNOT be linked hence are separate and hence x2 maintenance fee plus x2 100k usd !!... that chance u speak off very small but I’ll speak to them again soon.

 

[crystalnox]

umm that’s not what I meant. It is likely the LLC and SG accounts CANNOT be linked hence are separate and hence x2 maintenance fee plus x2 100k usd !!... that chance u speak off very small but I’ll speak to them again soon.

There goes my glimmer of hope.

 

[Han Shot First]

The yield-to-maturity is about 2.4% right now, which includes dividends (coupons from the underlying bonds) and capital gains/losses as the bonds in the portfolio converge to their maturity value of 100 cents on the dollar.

If the yield-to-maturity of MBH is about 2.4%, would it make more sense to contribute to one's CPF OA the money (cash) one would have used to buy more MBH? Main reason: interest rate of CPF OA is higher at 2.5%. And if one did a contribution to 3 CPF accounts, namely OA, SA and MA, the "blended" interest rate is even higher.

 

[elemention]

Latest Updates to IB SG Account

I've just had a conversation with IB online customer service.

1. They allow you to create two accounts. i.e. one LLC, and the other SG. Do note join account SG is not yet available.

2. Someone did mentioned not long ago that LLC will be forced into SG eventually ..perhaps by the end of the year..........

however, today, the IB service staff says, that was the initial plan, but now they have decided NOT TO FORCE the conversion.

Hi Swan02, I saw your post about the new changes to IB SG accounts and decided to clarify with the IB service staff too. Just came back from a 1 hour long comprehensive chat with the IB staff and I thought it will be good to provide these updates here for everyone to know!

1. You are right that there will no longer be a forced conversion. However, we will not be able to have 2 accounts with different entities.
This means that we can only choose to either keep the existing IB LLC account or request to transfer to the new IB SG account.

1(A) So if we choose to keep our existing IB LLC account, no action is required on our end as of now and we can trade international stocks expect SG stocks. Also, we will be eligible for third party protection like the SIPC which covers IB LLC accounts.

1(B) If we choose to have the new IB SG account and request a transfer, we can trade both International as well as SG stocks. However, there will not be third party protection like the SIPC. Our assets will remain segregated from IBKR's business accounts in custodian account "ABN AMRO Singapore Branch"

(Take note that this choice of either keeping the IB LLC account or going with the new IB SG account only applies to existing customers. For new customers, it will automatically only be IB SG)

For those that have applied to transfer or already transferred like myself, we can submit a ticket requesting to revert via the account management page.
Personally, I feel that there might still be changes and will probably take some time before all these updates are finalized. Hope that these information will be useful for you all!

 

[swan02]

Ark !! I was told two accounts of one llc and one SG allowed and I even reiterated to the staff to clarify..... I will again speak to them to triple confirm. Cuz I really like the idea of two diff accounts.

They so screw up like a GIRO issue I had and it went in circles.

Thanks for clarifying

Hi Swan02, I saw your post about the new changes to IB SG accounts and decided to clarify with the IB service staff too. Just came back from a 1 hour long comprehensive chat with the IB staff and I thought it will be good to provide these updates here for everyone to know!

1. You are right that there will no longer be a forced conversion. However, we will not be able to have 2 accounts with different entities.
This means that we can only choose to either keep the existing IB LLC account or request to transfer to the new IB SG account.

1(A) So if we choose to keep our existing IB LLC account, no action is required on our end as of now and we can trade international stocks expect SG stocks. Also, we will be eligible for third party protection like the SIPC which covers IB LLC accounts.

1(B) If we choose to have the new IB SG account and request a transfer, we can trade both International as well as SG stocks. However, there will not be third party protection like the SIPC. Our assets will remain segregated from IBKR's business accounts in custodian account "ABN AMRO Singapore Branch"

(Take note that this choice of either keeping the IB LLC account or going with the new IB SG account only applies to existing customers. For new customers, it will automatically only be IB SG)

For those that have applied to transfer or already transferred like myself, we can submit a ticket requesting to revert via the account management page.
Personally, I feel that there might still be changes and will probably take some time before all these updates are finalized. Hope that these information will be useful for you all!