How to invest in listed securities in Singapore Stock Exchange
In today's buoyant stock markets in the Asia region and in the US equities market, people are thinking, should I jump into the market? With the Singapore Exchange's Straits Times index at historic highs, many first-time investors are asking basic questions, how do I get into the market?
Start to investing in securities
Let me share how you can participate in this market. But please perform your own risk assessment and analysis if:
The steps are simple.
How to start investing in stocks and shares
1. You must first be old enough to invest - are you at least 21 years old?
You must be 21 years old to open a Central Depository (CDP) account as the SGX uses a scripless book-entry system for recording your share transactions.
2. You need to open a CDP account with the Central Depository
The detailed instructions are here. It costs nothing except a bit of time to open one and anyone can open a CDP account, you just need to produce a form of identity be it your NRIC or passport.
3. You need to open a stock broking account
Having a CDP account will enable you to apply for initial public offers for securities listed on the SGX. If you intend to sell or buy securities on the SGX, you can open a stock broking account with any of the members of the Stock Exchange listed here.
I myself use Phillip Securities with their POEMS trading platform. It has served me well for the past 4 years or so. Most of the stock broking firms do not charge for opening up an account but may have some minimum deposit required (e.g. $1,000 or $2,000) which is refundable. Check with the stock broker you intend to use about the details. Stock broking firms earn commissions when you buy and sell shares, so check which one is offering a competitive price. Internet trading accounts are a must nowadays as the commissions are lower than broker-assisted trades.
4. You need to understand the stock market
Investing in stocks and shares on the stock market is not gambling. It can turn into speculation or gambling if you do understand the risks and what is your targeted returns and time horizon for investment.
The stock market is a market where securities are listed for buyers and sellers to buy and sell securities at a given price. As the market is made up of people and facilitated by computers and networks, why the market moves up and down really is based on the sentiment and information available at any point in time to the market players. As retail investors, we tend to be nimble but we may have less information available to us compared to the big players such as fund managers. The internet has helped to level the playing field a little bit but still because of the volumes bought/sold by the big players, they can literally "move" the market.
Depending on your investment objectives, you pick the stocks that you want to buy, sell or hold. Caveat emptor, let the buyer beware. The stock market comes with opportunities but also risks as well. In general, if you are new investor, do not use margin trading or leverage to buy shares. Use only money you can afford to lose. Read books such as "One Up on Wall Street" by Peter Lynch or "The Intelligent Investor" by Benjamin Graham before you plunge into the exciting and risky world of stock investments.
Be well and prosper.
Start to investing in securities
Let me share how you can participate in this market. But please perform your own risk assessment and analysis if:
- Do you have an investment objective?
- What is your investible savings available?
- Am I prepared to accept the risk of losing it all?
- What is my investment time horizon?
The steps are simple.
How to start investing in stocks and shares
1. You must first be old enough to invest - are you at least 21 years old?
You must be 21 years old to open a Central Depository (CDP) account as the SGX uses a scripless book-entry system for recording your share transactions.
2. You need to open a CDP account with the Central Depository
The detailed instructions are here. It costs nothing except a bit of time to open one and anyone can open a CDP account, you just need to produce a form of identity be it your NRIC or passport.
3. You need to open a stock broking account
Having a CDP account will enable you to apply for initial public offers for securities listed on the SGX. If you intend to sell or buy securities on the SGX, you can open a stock broking account with any of the members of the Stock Exchange listed here.
I myself use Phillip Securities with their POEMS trading platform. It has served me well for the past 4 years or so. Most of the stock broking firms do not charge for opening up an account but may have some minimum deposit required (e.g. $1,000 or $2,000) which is refundable. Check with the stock broker you intend to use about the details. Stock broking firms earn commissions when you buy and sell shares, so check which one is offering a competitive price. Internet trading accounts are a must nowadays as the commissions are lower than broker-assisted trades.
4. You need to understand the stock market
Investing in stocks and shares on the stock market is not gambling. It can turn into speculation or gambling if you do understand the risks and what is your targeted returns and time horizon for investment.
The stock market is a market where securities are listed for buyers and sellers to buy and sell securities at a given price. As the market is made up of people and facilitated by computers and networks, why the market moves up and down really is based on the sentiment and information available at any point in time to the market players. As retail investors, we tend to be nimble but we may have less information available to us compared to the big players such as fund managers. The internet has helped to level the playing field a little bit but still because of the volumes bought/sold by the big players, they can literally "move" the market.
Depending on your investment objectives, you pick the stocks that you want to buy, sell or hold. Caveat emptor, let the buyer beware. The stock market comes with opportunities but also risks as well. In general, if you are new investor, do not use margin trading or leverage to buy shares. Use only money you can afford to lose. Read books such as "One Up on Wall Street" by Peter Lynch or "The Intelligent Investor" by Benjamin Graham before you plunge into the exciting and risky world of stock investments.
Be well and prosper.
No comments:
Post a Comment