For most people who are interested in investing, opening a stock brokerage account is usually one of the first steps to take in the investment journey. With the numerous stock brokerage firms available out there, selecting one over another could prove a daunting task.
Here are some of the things to take note of when opening a stock brokerage account, and the questions you should be asking.


Opening a CDP account

Before you can start trading, you have to first open a Direct Securities Account with the Central Depository (CDP).
The CDP is own by the Singapore Exchange and acts like a central storage place where all local shares bought are ‘kept’. To open a CDP account, you must be at least 18 years old and not be an un-discharged bankrupt.
There are 2 ways to open an account. The most common way is to open your first brokerage account and get the brokerage firm to assist you in opening a CDP account. Another way is to open an account directly with CDP itself via their online platform. You may have multiple brokerage accounts, but you will always have just one CDP account.
Key things to look out for when choosing a stock brokerage account
A brokerage account is an account through which you will do the buying and selling of shares. It is usually tagged with a brokerage firm (e.g. UOB Kay Hian, Maybank Kim Eng), which will transact trades on behalf of the instructions of its clients.
Here are some important considerations to take note of when opening a brokerage account.
  1. Fund Transfers:
If there is a need to transfer funds to the brokerage company where you purchase shares, some readers may find it more convenient to open a brokerage account with a bank that they already have a saving account with. For example, if you have a DBS account, it may be more convenient for you to open a brokerage account with DBS Vickers.
  1. Level of Support:
The level of support received is important. We think it is essential to have someone whom we can call to when we have queries, whether technical or otherwise. Most of the brokerage firm should provide this service, though the level of service received depends very much on the trading representative that is assigned to you.
  1. Starters Pack:
If you are new to trading, you will need to start from somewhere. Some of the brokerage firms have introduced starter packs for investors who are new. For example, OCBC Securities have the OCBC Young Investor Pack, which offers commission rebate for the first trade and other support services. The CIMB Securities Youth Engagement is another such service worth considering.
  1. Risk of Default:
Your brokerage firm defaulting is definitely an issue you DO NOT WANT to be concerned about. We can safely say that the risks of brokerage houses defaulting are very slim due to stringent regulations that MAS imposes. Nonetheless, a low probability does not equate to zero chance of the incident happening, as seen from the failure of MF Global.
One suggestion is to choose brokerage firms that are well established in Singapore.
  1. Commission Fee:
When an investor purchases shares, they have to pay a commission fee for the brokerage company to transact on their behalf. Bear in mind that this is a two-way charge. A commission charge is payable during both the purchase and sale of shares..
  1. Other Services:
In recent years, it has become more common for brokerage firms to offer affordable investment plans that enable customers to choose and invest in stocks via a regular monthly investment plan that could be as little as $100 monthly. Most of these investment plans are only accessible to those who already have a brokerage account with the firm. Hence, if your intention is to tap on this feature, it will be good to consider a brokerage firm that offers this service. Example includes the newly introduced Maybank Kim Eng Monthly Investment Plan, which allows users to select from up to 225 stocks across 5 different markets.


Ref:http://dollarsandsense.sg/6-things-to-know-before-opening-a-stock-brokerage-account/