Opening a CDP account in Singapore is a crucial step for investors who wish to trade in Singapore’s stock market. The Central Depository (CDP) is a subsidiary of the Singapore Exchange (SGX), which provides depository, clearing, and settlement services for securities traded on the SGX. As such, a CDP account is necessary for investors who wish to buy or sell securities listed on the SGX.
To open a CDP account, you must meet several requirements, including being at least 18 years old, not being an undischarged bankrupt, and having an existing Singapore bank account with one of the participating banks. The account opening process can be completed online, and you’ll need to provide supporting documents to verify your identity, such as your NRIC or passport.
Once you’ve opened a CDP account, you can link it to your brokerage account, which allows you to buy and sell securities listed on the SGX. You can also manage your investments through your CDP account, such as transferring shares from one account to another or pledging your shares as collateral for loans. Understanding how to open and manage a CDP account is essential for investors who wish to trade in Singapore’s stock market.
Key Takeaways
- A CDP account is necessary for investors who wish to buy or sell securities listed on the SGX.
- To open a CDP account, you must meet several requirements, including having an existing Singapore bank account with one of the participating banks.
- Once you’ve opened a CDP account, you can link it to your brokerage account and manage your investments through your CDP account.
Understanding CDP Accounts
If you’re looking to invest in the Singapore securities market, you’ll need to open a Central Depository (CDP) account. This account provides integrated clearing, settlement, and depository facilities for equities, fixed income instruments, and other listed securities. Here’s what you need to know about CDP accounts.
The Role of the Central Depository
The CDP is a central depository that was established by the Singapore Exchange (SGX) in 1987. Its three main roles are:
- Being a Central Counterparty: The CDP acts as a buyer to every seller and a seller to every buyer, ensuring the completion of every trade.
- A Securities Settlement System: The CDP ensures that securities are delivered to the buyer and payment is made to the seller on the settlement date.
- A Central Securities Depository: The CDP holds securities in electronic form and provides a safe and secure environment for their custody.
Differences Between Individual, Joint, and Corporate Accounts
When opening a CDP account, you can choose between an individual, joint, or corporate account, depending on your needs. Here are the differences between these account types:
- Individual Account: This type of account is for individuals who want to invest in the securities market on their own. You’ll need to be at least 18 years old and have an existing Singapore bank account from one of the following banks: Citibank, DBS/POSB, HSBC, Maybank, OCBC, SCB, or UOB.
- Joint Account: This type of account is for two or more individuals who want to invest in the securities market together. All account holders must be at least 18 years old and have an existing Singapore bank account from one of the banks listed above.
- Corporate Account: This type of account is for companies that want to invest in the securities market. The company must be registered with the Accounting and Corporate Regulatory Authority (ACRA) and have a Singapore bank account from one of the banks listed above.
Opening a CDP account is a necessary step for anyone looking to invest in the Singapore securities market. With the information provided above, you should now have a better understanding of the role of the CDP and the differences between individual, joint, and corporate accounts.
The Account Opening Process
Eligibility Criteria and Required Documents
Before you can open a CDP account, you need to meet the eligibility criteria and provide the required documents. To be eligible, you must be at least 18 years old, not an undischarged bankrupt, and have an existing Singapore bank account from one of the following banks: Citibank, DBS/POSB, HSBC, Maybank, OCBC, SCB, or UOB.
You will also need to provide the following primary support documents:
- For Singaporeans and Permanent Residents (PRs): NRIC or passport
- For non-Singaporeans and non-PRs: Passport and Employment Pass or Dependent Pass
In addition, you will need to provide a secondary support document, such as a utility bill or bank statement, to verify your residential address. If you are using your passport as your primary support document, you will also need to provide your Tax Identification Number (TIN) or a self-declaration form.
Step-by-Step Guide to Opening Your CDP Account Online
Opening a CDP account online is quick and easy. Here is a step-by-step guide to help you get started:
- Visit the SGX website and select “Sign up using Myinfo” if you are a Singaporean or PR. If you are a non-Singaporean or non-PR, select “Sign up using the online form, with supporting documents.”
- Log in using your SingPass or provide the required personal details and upload your supporting documents.
- Review and confirm your details.
- Make payment for your CDP account opening fee of $10 via credit card or eNets.
- Wait for your CDP account to be activated. This usually takes one to two business days.
Once your CDP account is activated, you can start trading on the Singapore Exchange (SGX). Remember to keep your CDP account details and password secure and never share them with anyone.
Opening a CDP account is an important step if you want to invest in Singapore’s stock market. By following these simple steps, you can easily open your CDP account online and start trading on SGX.
Linking Bank and Brokerage Accounts
If you want to start trading stocks in Singapore, you’ll need to link your CDP account to a local bank account and a brokerage account. Here’s what you need to know:
Connecting Your CDP Account to Local Banks
To open a CDP account, you need to have a Singapore bank account with one of the following banks: Citibank, DBS/POSB, HSBC, Maybank, OCBC, Standard Chartered Bank, or UOB. Once you have your CDP account, you can link it to your bank account by providing the bank details to CDP. This will allow you to transfer funds between your bank account and your CDP account.
Choosing the Right Brokerage
After you’ve linked your CDP account to your bank account, you’ll need to choose a brokerage to link to your CDP account. There are many brokerages to choose from in Singapore, including DBS Vickers, UOB Kay Hian, and OCBC Securities. When choosing a brokerage, consider factors such as fees, trading platform, and customer service.
Once you’ve chosen a brokerage, you’ll need to open a trading account with them and link it to your CDP account. This will allow you to buy and sell stocks on the Singapore Exchange (SGX). When you buy a stock, it will be deposited into your CDP account, and when you sell a stock, the proceeds will be deposited into your bank account.
In conclusion, linking your CDP account to your bank account and brokerage account is an essential step in trading stocks in Singapore. By following the steps outlined above, you’ll be able to start trading stocks on the SGX and take advantage of the opportunities available in the Singapore stock market.
Managing Investments Through CDP
As a CDP account holder, you have direct ownership of your investment portfolio. This means you can manage your portfolio with confidence and ease. Here are some ways to manage your investments through CDP.
Monitoring Stocks and Bonds
With a CDP account, you can easily monitor your stocks and bonds. You can log in to your CDP account to view your portfolio, check your holdings, and track the performance of your investments. You can also use a stock screener to find new investment opportunities and make informed investment decisions.
Understanding Corporate Actions and Dividends
As a shareholder, you will receive regular company announcements and market updates. You can stay informed about the latest developments in the market and make informed investment decisions. You will also receive information about corporate actions such as stock splits, mergers, and acquisitions. Additionally, you will receive dividend payouts from companies you have invested in.
Overall, managing your investments through CDP is a great way to take control of your portfolio and make informed investment decisions. With direct ownership of your investments, you can shape your investment journey with confidence and ease. So why not open a CDP account today and start investing in companies and other listed securities on the Singapore Exchange?
Additional Services and Features
Direct Crediting Service (DCS) and Monthly Statements
One of the benefits of opening a CDP account in Singapore is the Direct Crediting Service (DCS), which allows you to receive dividends and other cash distributions directly into your designated bank account. This service is free of charge and can save you time and hassle.
In addition, you will receive monthly statements from CDP that provide you with a summary of your transactions and holdings. These statements are useful for keeping track of your investments and ensuring that your portfolio is performing as expected.
Retirement and Long-term Investment Strategies
If you are looking to retire or make long-term investments, a CDP account can be a valuable tool. With a CDP account, you can invest in a variety of securities, including equities and fixed income instruments, which can help you build a diversified portfolio.
In addition, you can use your CDP account to invest in Singapore Savings Bonds, which are a low-risk investment option that can provide you with a steady stream of income. You can also use your CDP account to invest in other retirement and long-term investment products, such as the CPF Investment Scheme.
Overall, a CDP account in Singapore offers a range of additional services and features that can help you manage your investments more effectively and achieve your long-term financial goals. With the Direct Crediting Service and monthly statements, you can stay on top of your investments and ensure that you are receiving the returns you expect. And with a range of retirement and long-term investment strategies available, you can build a portfolio that is tailored to your needs and objectives.
Frequently Asked Questions
How can I open a CDP account online in Singapore?
Opening a CDP account online in Singapore is a straightforward process that can be completed in a few simple steps. You can visit the SGX website and follow the instructions to open a CDP account online. Alternatively, you can visit any of the SGX-approved banks and open a CDP account through them.
What are the requirements to open a CDP account in Singapore?
To open a CDP account in Singapore, you must be at least 18 years old and not an undischarged bankrupt. You must also have an existing Singapore bank account from one of the approved banks, which include Citibank, DBS/POSB, HSBC, Maybank, OCBC, SCB or UOB.
How much time does it take to get a CDP account approved?
The approval time for a CDP account in Singapore can vary depending on the method you choose to open the account. If you apply online, the approval process can take up to 3 business days. However, if you apply through an approved bank, the approval process can take up to 2 weeks.
Is it possible to open a CDP account through DBS?
Yes, it is possible to open a CDP account through DBS. DBS is one of the approved banks for opening a CDP account in Singapore. You can visit any DBS branch to open a CDP account.
Are there any charges for maintaining a CDP account?
Yes, there are charges for maintaining a CDP account in Singapore. The annual fee for maintaining a CDP account is $10.70, which is deducted from your CDP account at the end of each year.
What steps should I follow to login to my SGX CDP account?
To log in to your SGX CDP account, you need to visit the SGX website and click on the “CDP” tab. Then, enter your CDP account number and password to log in. If you forget your password, you can reset it by clicking on the “Forgot Password” link and following the instructions.