Compare the Best Online Investment Brokerages in Singapore | Up to $550 Cash

Commodity trading grants exposure to raw materials and commodities such as precious metals (gold, silver), energy (crude oil, natural gas) and agriculture (corn, soybeans). These are usually traded via futures contracts, CFDs (contract for differences), or ETFs.

Notably, commodity prices are influenced by global economic trends, geopolitical tensions, weather conditions, and supply and demand dynamics.

Stocks, otherwise known as shares, are popular long-term securities traded actively via brokers or CFDs. They signify part-ownership in a company. Holding shares of firms like Singtel or CapitaLand means you’re a part-owner entitled to potential capital gains and dividends. A good investor will carefully evaluate a company’s financials and business prospects before purchasing its shares.

Bonds are fixed income instruments. Purchasing a bond essentially means lending money to a government or company in exchange for fixed and periodic payments. In Singapore, any retail investor can access bonds via Singapore Savings Bonds (SSBs), corporate bonds, or bond ETFs. While money is returned at maturity and considerably lower risk, returns can still fluctuate based on interest rate movements and issuer creditworthiness.

An index tracks the performance of a specific basket of securities (e.g. stocks, bonds, ETFs, REITs, etc.). In Singapore, the Straits Times Index (STI) tracks the performance of the top 30 companies listed on the SGX, and serves as an indicator of Singapore’s economic health. You gain exposure to indices via ETFs or CFDs.

An ETF (Exchange-Traded Fund) is a basket of assets like stocks, bonds, or commodities. They are traded like individual stocks on an exchange. Many ETFs are designed to replicate or track the performance of an underlying index. For example, the STI ETF tracks the Straits Times Index.

ETFs offer diversification, lower fees, and transparency, making them popular among both beginner and experienced investors. Since an ETF is marketed as a security, it has a buy and sell price and can be traded on an exchange.

A CFD (Contract For Difference) is a derivative product from entering a contract between you and the brokerage firm to exchange the price difference of an asset between the time you first open and close a position. There is no actual ownership of the underlying asset (e.g. stock, commodity) and leverages are often involved.

Futures are standardised financial contracts that obligate traders to transact an asset at a set price on a predetermined future date. You can buy futures on a variety of asset classes such as forex, commodities, equities, and indices.

Mutual funds or unit trusts are pools of money collected from investors and subsequently professionally managed and diversified across asset classes such as stocks, and commodities. Since these funds will be used to buy a variety of securities, it is generally considered a safer investment instrument, but they still carry risk.

Brokerage fees include more than just commissions. Look out for extra charges like deposit, withdrawal, account maintenance fees, and others. Active traders will benefit from low per-trade costs, while casual investors should still beware of minimum chargers that affect smaller trades.

An user-friendly interface can greatly enhance your trading experience. Look out for intuitive navigation, clear layouts, and responsive features on both desktop and mobile.

While the ease of account opening and maintenance vary, most online brokerages in Singapore generally support SingPass MyInfo, allowing Singaporeans and PRs to open accounts instantly without tedious paperwork.

When choosing a brokerage, start by identifying trading products you plan to invest in. Not all brokerage platforms offer the same range of instruments, so limited product access can be a constraint.

For instance, if you wish to trade both Singapore-listed stocks (SGX) and US equities, choose a broker with access to both markets.

Similarly, if investing in other asset classes such as contracts for difference (CFDs), precious metals like gold, or real estate investment trusts (REITs), your broker should support these products too.

Before committing to an online brokerage, testing out different platforms with a demo account is useful. Trying out different brokerage interfaces in trial versions allow you to decide on a platform best aligned to your trading style and preferences.

Many brokers hire in-house professional analysts and experts to help investors interpret market behaviour and understand stock performance.

Some brokers also host webinars and networking events for professional investors and traders to mingle and share market outlooks and respond to live questions from participants.

In Singapore, you must be at least 18 years old and not an undischarged bankrupt to open a trading or investment account. Also, decide on how much starting capital you’re comfortable with—$1,000 is a good benchmark for many.

A Central Depository (CDP) account, managed by the SGX, allows you to securely hold and own purchased SGX-listed stocks. You can create your CDP account online.

Select an MAS-regulated online brokerage to open an account with. A trading account lets you buy and sell shares in various markets. You can open multiple trading accounts across different platforms.

Some factors to consider when choosing what shares to buy is the industry, business model, management, growth indicators (share price or dividend yields), stability (debt/ EBITDA ratio). Finally, does the stock you investing in suit your investment style, strategy, and risk appetite?

Are you a short-term trader or long-term investor? Reflect, review, and rebalance your portfolio periodically to assess its performance, adjust your goals, and adapt to changing market conditions.