My experience using Standard Chartered Online Trading to trade US stocks
There are many reasons why you would want to open an account with Standard Chartered bank. one of it is the lower brokerage fees with SCB compared to other brokerage houses.
Traditional brokerages like Vickers, iOCBC are charging minimally 25 USD or 1.8% whichever is higher.
SCB charges minimally 10 USD, or 0.25% for personal banking clients.
If you have $200,000 in assets, you will qualify for SCB priority banking rates with no minimum commission. Commission rate is 0.20% for US trades.
Surprisingly, SCB charges only 0.20% or 10 SGD for SGX trades, as compared DBS's minimum 25 SGD or 0.28%.
For a small-time trader like Mr Llama, SCB is definitely more suitable as minimum commission is only 10 USD.
Refer to below screenshots if you require more information:
Opening the account
I opened my account at the branch in Nex Serangoon.
It is fairly simple. Just get a ticket number and wait for your turn.
Upon completion of administration at the branch, you will have to wait for a few weeks before the trading account is ready for trading. I remembered mine took around a month.
You will likely have the following accounts:
1. E-saver account (Normal savings account)
2. Settlement accounts in various currencies (SGD for SGX, USD for US Exchanges, or SGX shares denominated in USD ie HK Land USD.
To be able to trade, you will have to transfer cash from your own personal account to the SCB E-saver account.
Thereafter, transfer the money from E-saver to the respective settlement accounts through a "Local transfer between own accounts" within Standard Chartered Online Banking.
Why do you need settlement accounts?
This is because SCB Online Trading does not allow contra-trading. (Contra-trading is settlement of trades T+3, meaning you can buy shares today and only pay 3 days later.)
Whatever balance you have in the settlement accounts, is the limit on the amount of shares you can purchase. If you have $5000 SGD in the SGD settlement account, you can then only purchase shares up to an amount of $5,000.
Easy to identify Profit and Losses under section "Realized P&L" - Overall figure shown in this section has already accounted for commissions
No need to wire money in and out; No minimum balance required; No fees required for funds withdrawal
Priority banking customers does not have any minimum commission, making it easier to perform dollar cost averaging.
Not for sophisticated traders - Quotes are delayed
No free trades - Some brokerages offer commission free trades, ie TD Ameritrade
Forex rate in currency conversion eats into returns
Required to maintain accounts balances - You are required to maintain at least $1,000 in the e-saver account.
So, will you use SCB Online trading platform?
In the US, big name brokerages has already moved towards commission free trades for shares and every other instruments (except for futures). Robinhood is the new start-up brokerage that led this change.
This is not yet happening in Singapore. Hence, SCB is still rather competitive in terms of brokerage rates.
I would say I am a no-frills trader. I rely on other websites for information and live quotes. However, things will be better if I were a priority banking customer and is not subjected to the minimum commissions.
Well, that can be my personal goal - to have minimum $200,000 in investments to enjoy priority banking status.