If you’re looking to invest in the Singapore stock market, you’ll need to open a CDP account. The Central Depository (CDP) is a subsidiary of the Singapore Exchange (SGX) that provides a secure and efficient way to hold and manage your securities. In this article, we’ll guide you through the process of applying for a CDP account in Singapore.
Before we dive into the application process, it’s important to understand what a CDP account is and why you need one. A CDP account is a custodian account that holds your securities in electronic form. It allows you to buy and sell securities on the SGX, receive dividends, and participate in corporate actions. Without a CDP account, you won’t be able to invest in the Singapore stock market. Now that you understand the importance of a CDP account, let’s take a look at the eligibility requirements and documents you’ll need to apply.
- A CDP account is necessary to invest in the Singapore stock market.
- To apply for a CDP account, you must meet eligibility requirements and provide supporting documents.
- The application process involves filling out an online form and submitting it with the required documents.
Understanding CDP Accounts
If you’re interested in investing in stocks, bonds, ETFs, and other securities listed on the Singapore Exchange (SGX), you’ll need a Central Depository (CDP) account. In this section, we’ll cover what a CDP account is and the benefits of having one.
What is a CDP Account?
A CDP account is a safekeeping account that holds your securities in the account. It’s a way to keep track of your holdings and ensure they’re secure. When you purchase securities, they’re credited to your CDP account, and when you sell them, they’re debited from your account. It’s important to note that you need both a Trading Account with a broker and a CDP Securities Account to start trading.
The Central Depository of the Singapore Stock Exchange (SGX) is responsible for managing all CDP accounts. You can open a CDP account if you’re a Singapore Citizen, Permanent Resident, or a foreigner with a valid passport.
Benefits of Having a CDP Account
There are several benefits of having a CDP account:
Direct Crediting Service: If you have a CDP account, you can receive dividends and other payments directly to your account. This saves you time and hassle compared to receiving payments by cheque.
Singapore Savings Bonds: You need a CDP account to purchase Singapore Savings Bonds. These bonds offer a low-risk investment option with a higher interest rate than savings accounts.
Secure Storage: Your securities are held securely in your CDP account, reducing the risk of loss or theft.
Ease of Trading: With a CDP account, you can easily buy and sell securities listed on the SGX. You can also view your holdings and track your portfolio performance.
In conclusion, a CDP account is a necessary component for investing in securities listed on the SGX. It offers secure storage, ease of trading, and access to investment options like Singapore Savings Bonds. With a CDP account, you can enjoy the benefits of investing without worrying about the safety and security of your holdings.
Eligibility and Documents Required
Who Can Apply?
If you are interested in opening a CDP account in Singapore, you must meet the following eligibility criteria:
- You must be at least 18 years old.
- You must not be an undischarged bankrupt.
- You must have a Singapore bank account with one of the following banks: Citibank, DBS/POSB, HSBC, Maybank, OCBC, SCB, or UOB.
If you meet all of the above criteria, you can proceed to apply for your CDP account. Non-Singapore residents can also apply for a CDP account, but they must meet additional requirements.
To apply for a CDP account, you will need to provide some necessary documentation. Here is a list of the documents you will need:
- A Singapore bank statement.
- A Tax Identification Number (TIN).
- A photographed or scanned copy of your signature.
- A passport or Malaysian IC (if you are not a Singapore citizen or PR).
- A SingPass or MyInfo account (if you are a Singapore citizen or PR).
It’s important to note that the above documents are required for both Singapore residents and non-residents. If you do not have a TIN, you can apply for one through the Inland Revenue Authority of Singapore (IRAS) website.
Once you have all the necessary documentation, you can proceed to apply for your CDP account. The process is relatively straightforward, and you can apply online through the SGX website.
Overall, opening a CDP account in Singapore is a simple and straightforward process. By meeting the eligibility criteria and providing the necessary documentation, you can easily apply for and receive your CDP account, which will allow you to participate in the Singapore securities market.
The Application Process
When it comes to applying for a CDP account in Singapore, there are two ways to go about it: online or manual. Here’s what you need to know about each method.
Online Application Steps
Applying online is a quick and easy way to get your CDP account up and running. To apply online, you’ll need to have a SingPass account and a bank account with one of the following banks: Citibank, DBS/POSB, HSBC, Maybank, OCBC, SCB, or UOB.
Here are the steps you’ll need to follow to apply for a CDP account online:
- Visit the SGX website and select the “Sign up using Myinfo” option.
- Log in to your SingPass account and follow the prompts to complete your personal details.
- Provide the necessary supporting documents, such as a photocopy of your NRIC, passport, or Malaysia Identification Card.
- Wait for your application to be processed and approved.
Manual Application Procedure
If you prefer to apply for your CDP account manually, you can do so by downloading and completing the application form from the SGX website. Here’s what you need to know:
- Download the CDP application form from the SGX website.
- Print out the form and complete it.
- Attach the necessary supporting documents, such as a photocopy of your NRIC, passport, or Malaysia Identification Card.
- Submit the application form and supporting documents to your broker or directly to CDP.
Keep in mind that the manual application process may take longer than the online process, as you’ll need to wait for your application to be processed and approved manually.
Regardless of which method you choose, it’s important to make sure that you have all the necessary documents and information on hand before you begin your application. This will help ensure that your application is processed quickly and smoothly, so you can start trading right away.
Linking Your CDP Account
Once you have successfully created your CDP account, you will need to link it to other accounts to start trading. In this section, we will discuss how to connect your CDP account to the SGX and brokerage accounts.
Connecting with SGX
To connect your CDP account with the SGX, you will need to fill out and submit the SGX Apply for/Revoke Linkage Form. Once you have completed the form, mail it to DBS using their Business Reply Envelope. It may take some time for your request to be processed, so it is better to create your CDP account first before signing up for DBS Vickers.
Linking to Brokerage Accounts
To start trading, you will need to link your CDP account to a brokerage account. This can be done through various brokerage firms, such as DBS Vickers, OCBC Securities, and UOB Kay Hian. Once you have chosen a brokerage firm, you will need to submit a request to link your CDP account to your brokerage account.
To link your CDP account to DBS Vickers, you will need to fill out and submit the SGX Apply for/Revoke Linkage Form. You can then mail the form to DBS using their Business Reply Envelope. It may take some time for your request to be processed.
It is important to note that your CDP account must already have a Direct Crediting Service (DCS) bank account linked up before you can apply for the Savings Bonds. Participating DCS banks in Singapore are currently Citibank, DBS/POSB, HSBC, Maybank, OCBC, Standard Chartered Bank, and UOB.
Overall, linking your CDP account is a crucial step in starting your trading journey. By following the steps outlined above, you can easily connect your CDP account with the SGX and brokerage accounts and start trading with ease.
Managing Your CDP Account
Congratulations on successfully opening your CDP account in Singapore! Now that you have your account set up, it’s time to start managing it. Here are some tips to help you get started.
Understanding Your Portfolio
Your portfolio is a record of all the securities you own. It includes information such as the number of shares you own, the unit cost, and the market price. It’s important to keep track of your portfolio so you can monitor your investments and make informed decisions about buying and selling.
Monitoring and Trading
Once you have a good understanding of your portfolio, you can start monitoring the market and trading securities. You can use the stock screener to find securities that meet your investment criteria, and the watchlist to keep track of securities you’re interested in.
When you’re ready to buy or sell, you can place an order through your broker. Make sure to keep track of your monthly transactions so you can monitor your cash balance and fees.
It’s also important to keep an eye on company announcements and market updates. This information can help you make informed decisions about buying and selling securities.
Finally, don’t forget about dividend payouts and profit and loss. Make sure to keep track of your unit cost and market price so you can calculate your profit and loss accurately.
Managing your CDP account can seem daunting at first, but with a little bit of knowledge and practice, you’ll be a pro in no time!
Frequently Asked Questions
How can you open a CDP account in Singapore and what’s the process?
To open a CDP account in Singapore, you can follow these steps:
- Visit the SGX website and fill in your personal details.
- Provide your bank and tax residence details.
- Upload the necessary documents.
- Review and submit your application.
What’s the typical timeframe for a CDP account approval? Can’t wait to start trading!
The typical timeframe for a CDP account approval is around 7-10 business days. However, it may take longer if there are any issues with your application. Once your account is approved, you can start trading immediately.
Is opening a CDP account free, or are there any charges you should be aware of?
Opening a CDP account in Singapore is free of charge. However, there are certain fees associated with using the account, such as brokerage fees and trading fees. Make sure to check with your broker to understand the fees involved.
Can you open a CDP account through DBS, and how does that work?
Yes, you can open a CDP account through DBS. Simply visit the DBS website and follow the instructions to open your account. Once your account is approved, you can start trading with your DBS account.
How do you check the balance and activity in your CDP account?
You can check the balance and activity in your CDP account by logging into your account on the SGX website. From there, you can view your portfolio and track your trades.
What’s the procedure for withdrawing funds from your CDP account?
To withdraw funds from your CDP account, you can follow these steps:
- Log in to your CDP account.
- Select the “Withdrawal” option.
- Enter the amount you wish to withdraw.
- Confirm your withdrawal request.
Once your request is processed, the funds will be transferred to your linked bank account.