Comparison of online brokerage fees

5
I am writing this post for my friend who asked me about brokerage fees for trading on the Singapore Exchange.

Standard Chartered Singapore
Terms & Conditions, FAQ

Brokerage Fee for Online Transactions: 0.20% for standard customers (or 0.18% for priority customers). No minimum fee.

Limitations: You must place funds into a SCB settlement account before you are allowed to transact. Therefore, you can't "contra" with money you don't have.

DBS Vickers
http://www.dbsvonline.com/english/Pfee.asp?SessionID=&RefNo=&AccountNum=&Alternate=&Level=Public&ResidentType=#2

Standard Online Transactions
Minimum Commission: SGD25
SGD50,000 and below: 0.28%
SGD50,001 - SGD100,000: 0.22%
Above SGD100,000: 0.18%

Preferential commission rate of 0.18% or minimum S$18 for all Singapore trades but customer must place funds into a SCB settlement account before trading to enjoy this rate.

Philip Securities POEMS
http://www.poems.com.sg/

Minimum Commission: SGD25
SGD50,000 and below: 0.28%
SGD50,001 - SGD100,000: 0.22%
Above SGD100,000: 0.18%

Note: The fees above are for trading in SGD on the Singapore Exchange. There are further SGX and CDP fees which are the same across all trading platforms, therefore not accounted for in the following computations.


Here are examples calculation of brokerage charges for online transactions. Both Stanchart and DBS preferential require deposit of funds into your trading account to enjoy the rates stated below. POEMS does not have the option or requirement.

Example 1: Trading SGD 5000
Stanchart: 0.20% x $5000 = $10
DBS preferential rate: 0.18% x $5000 = $9 subject to minimum of $18 = $18
POEMS: 0.28% x $5000 = $14 subject to minimum of $25 = $25
Price difference between the lowest and highest rate = $15

Example 2: Trading SGD 8000
Stanchart: 0.20% x $8000 = $16
DBS preferential rate: 0.18% x $8000 = $14.4 subject to minimum of $18 = $18
POEMS: 0.28% x $8000 = $22.4 subject to minimum of $25 = $25
Price difference between the lowest and highest rate = $6

Example 3: Trading SGD 10000
Stanchart: 0.20% x $10000 = $20
DBS: 0.18% x $10000 = $18 subject to minimum of $18 = $18
POEMS: 0.28% x $10000 = $28 subject to minimum of $25 = $28
Price difference between the lowest and highest rate = $10

Example 4: Trading SGD 20000
Stanchart: 0.20% x $20000 = $40
DBS preferential rate: 0.18% x $20000 = $36 subject to minimum of $18 = $36
POEMS: 0.28% x $20000 = $56 subject to minimum of $25 = $56
Price difference between the lowest and highest rate = $20

Do note that trading platforms are not equal. In the old days, the trader on the floor who shouts the loudest may get his trade recorded first. Nowdays, the faster system gets the customers' trades executed first. So is it worth using to a platform that charges lower fees instead of a tried-and-tested system that charges $20 more?

On the 5th of August 2011, everyone was busy dumping their shares. Which platform would you use if you know the trading volume is going to be super-high? I used POEMS. It didn't matter that I was going to pay higher brokerage fees. I just wanted my trades to be executed fast!

5 comments:

Anonymous said...

Very concise and clear! I also agree that i will not try to save a few dollars but instead use a tried and tested platform

Anonymous said...

Who could ever forget the day 5th August 2011

David said...

Yu-Kym,

A very informative comparison.

Would you be willing to share your biggest gainers and biggest losers amongst you stock picks for 2011.

Dare to make any 2012 predictions for investors?

I am almost 100% into mutual funds and a few bond funds. I plan on retiriing within 7 to 9 years so my investments are balanced between growth and capital preservation. Despite 2011s volitility my portfolio is up 11% from 2010.

I trust you are nearly over the flu and feeling better.

David

WaiZai said...

Nice post, thumbs up

Anonymous said...

Hi Yu-Kym,
Thanks to your post, I began my interest in investing! Just wanted to let you know :)
Also curious, if you don't mind sharing, how else are you investing your money besides trading in shares?