Saxo capital markets

[Hulumas]

Does anyone have accounts with Saxo Capital? I'm curious as to how "stable" the brokerage is. Do they have 3rd party insurance in the event of brokerage collapse. For e.g. optionsXpress SG has the mandatory SIPC insurance plus additional insurance from Lyolds to insure against the event of brokerage collapse. Anything similar for Saxo Capital>?

You can read about "segregated accounts" account here:
http://sg.saxobank.com/en/about-us/lega ... terms.aspx

Anyway, I emailed your post to Saxo, lets wait for their reply.

Account segregation just means that Saxo separates "their" money from "our" money. In any case, the phrasing indicates that all MAS regulated financial entities have to do such segregation, so it's not something extra that Saxo is doing, as it implies that every broker doing business in Singapore has to operate like this.

Still, I wonder even if the accounts are kept separate, does Saxo has any legal right to tap into "our" money if the situation necessitates it? Personally, I'll still feel better if there was a 3rd party insuring against the collapse of the brokerage.

Oh yes, I know better now about SAXO CAPITAL. Thank you.

[choozm]

Does anyone have accounts with Saxo Capital? I'm curious as to how "stable" the brokerage is. Do they have 3rd party insurance in the event of brokerage collapse. For e.g. optionsXpress SG has the mandatory SIPC insurance plus additional insurance from Lyolds to insure against the event of brokerage collapse. Anything similar for Saxo Capital>?

You can read about "segregated accounts" account here:
http://sg.saxobank.com/en/about-us/lega ... terms.aspx

Anyway, I emailed your post to Saxo, lets wait for their reply.

Reply from my Saxo broker:

Are my funds with SCM covered by the guarantee issued by the Singapore Government?
The Singapore Government has decided to guarantee all Singapore Dollar and foreign currency deposits of individual and non-bank customers in banks, finance companies and merchant banks licensed by the MAS.

The Singapore Government has assessed that a guarantee of up to S$150 billion will be well in excess of possible liabilities arising from the failure of any financial institutions. The guarantee will be backed by S$150 billion of the reserves of the Singapore Government. The guarantee will take immediate effect and will remain in place until 31 December 2010.

Saxo Capital Markets is not a bank, finance company or merchant bank and as such, funds sent by clients to Saxo Capital Markets are not directly covered by the guarantee.

However Saxo Capital Markets is obliged under MAS regulation to keep money received from clients in trust accounts segregated from the company’s own funds. Such trust accounts must be kept with banks, merchant banks or finance companies licensed in Singapore, or alternatively for money denominated in currencies other than Singapore dollars, with a custodian outside Singapore which is licensed, registered or authorised to conduct banking business in the country or territory where the account is maintained.

Therefore any funds received from clients that Saxo Capital Markets deposits with HSBC in Singapore will be covered by the guarantee issued by the Singapore Government.


How am I protected in the event of SCM’s bankruptcy?
Saxo Capital Markets is obliged by MAS regulation to hold money deposited by clients and assets held on behalf of clients in accounts segregated from the company’s own money and assets. The purpose of this regulation is to secure that the money and assets may be distributed safely back to the clients in the unlikely event of Saxo Capital Markets’ bankruptcy.


Is an account with SCM insured by the Singapore Deposit Insurance Corporation (SDIC)?
Saxo Capital Markets is licensed as a Capital Markets Services (CMS) provider by the Monetary Authority of Singapore. Funds deposited by clients with CMS licensees are not required to be insured by the Singapore Deposit Insurance Corporation, and as such funds deposited with Saxo Capital Markets are not insured.

However CMS licensees are obliged by MAS regulation to keep client funds segregated from the institution’s own funds, which aims to secure the clients’ funds in the event of default of the institution. Saxo Capital Markets are keeping its clients’ funds segregated in compliance with the regulation.


What does ”segregated accounts” mean?
In accordance with sections 16, 17, 26 and 27 of the Securities and Futures (Licensing and Conduct of Business) Regulations issued by the Monetary Authority of Singapore, Saxo Capital Markets is obliged to hold money received from clients and assets held on behalf of clients in accounts separated from the company’s own money and assets.

All funds deposited by clients with Saxo Capital Markets will be kept in a segregated client funds account in accordance with the above regulation. Securities held by clients with Saxo Capital Markets are equally kept in segregated custody accounts.


Who is the custodian of my securities?
Saxo Capital Markets is licensed to provide custodial services and as such the custodian of securities acquired through Saxo Capital Markets.

[Rommie2k6]

Sigh... typical cut-and-paste reply from the broker. Like it tells us anything new that is not already on the website... Notice how 3 out of 5 points keep harping on this segregation thing.

This is strange though...

Who is the custodian of my securities?
Saxo Capital Markets is licensed to provide custodial services and as such the custodian of securities acquired through Saxo Capital Markets.

So the custodian and the broker is the same entity?

[TBFF]

So the custodian and the broker is the same entity?

Yes, it's like asking your child to guard the cookies.

[laiboonh]

From wikipedia: "A Custodian bank, or simply custodian, is a financial institution responsible for safeguarding a firm's or individual's financial assets. The role of a custodian in such a case would be the following: to hold in safekeeping assets such as equities and bonds, arrange settlement of any purchases and sales of such securities, collect information on and income from such assets (dividends in the case of equities and coupons in the case of bonds), provide information on the underlying companies and their annual general meetings, manage cash transactions, perform foreign exchange transactions where required and provide regular reporting on all their activities to their clients."


It seems to me that its the norm that the custodian IS the broker. Are there any brokers that are not the custodian? poems? vickers?

So it seems like cash with SAXO is protected by segregated account arrangement but not securities right?

I'm a newbie keen on opening an account with SAXO, please enlighten me

So the custodian and the broker is the same entity?

Yes, it's like asking your child to guard the cookies.

[makoshark]

laiboonh,
It would be best if you asked Saxo directly.
Unless anyone else here has asked the same exact question, they are (at best) guessing.
By asking them directly, you can get the correct info which you can use as documentation should anything goes wrong.

[Hulumas]

So the custodian and the broker is the same entity?

Yes, it's like asking your child to guard the cookies.

What will it happen then?

[Private Investor]

Reply from my Saxo broker:

Who is the custodian of my securities?
Saxo Capital Markets is licensed to provide custodial services and as such the custodian of securities acquired through Saxo Capital Markets.

Wondering what will happen to our money if Saxo Capital Markets decided to close down Singapore operations. What choices are we entitled?

[newbie_george]

btw guys saxo decrease the min $$ to start an account.

if sexy saxo close down, then suck thumb lor...

[laiboonh]

Q. Are foreign securities kept with the CDP usually?



Quote from Lim&Tan website "Q32 What will happen to my shares after I have made payment for it? The shares will be kept in safe custody by L&T 's Foreign Broker."

SAXO - according to my fact finding, securities are kept with a custody bank (which bank? unknown)

[laiboonh]

Seeking a general opinion,

Is it more expensive to trade using Saxo platform because it uses exchange rate (spot rate +0.5% considering buy and sell thats 1% per buy and sell transaction)? I understand that banks (dbsvickers) use lousy exchange rate, but i am not able to determine what exchange rate dbsvickers is going to charge me before hand. Which is the better of the 2 options?

[choozm]

Seeking a general opinion,

Is it more expensive to trade using Saxo platform because it uses exchange rate (spot rate +0.5% considering buy and sell thats 1% per buy and sell transaction)? I understand that banks (dbsvickers) use lousy exchange rate, but i am not able to determine what exchange rate dbsvickers is going to charge me before hand. Which is the better of the 2 options?

Call DBS vickers, speak to them that you want to make US$ trade and ask for exchange rate (the rate is indicative only). I did that before. If I remember correctly, the exchange rate was better than banks.

[Rommie2k6]

btw guys saxo decrease the min $$ to start an account.

if sexy saxo close down, then suck thumb lor...

Are you sure? I called them and they still ask for $10k to set up an account. In my opinion that's an unreasonably large sum. Don't recall DBS Vickers asking me for such a sum when I opened my account...

[choozm]

btw guys saxo decrease the min $$ to start an account.

if sexy saxo close down, then suck thumb lor...

Are you sure? I called them and they still ask for $10k to set up an account. In my opinion that's an unreasonably large sum. Don't recall DBS Vickers asking me for such a sum when I opened my account...

You can accumulate your stocks/ETFs with DBSVickers/any other brokers, then when the value of the stocks/ETFs reaches $10000, transfer to Saxo to setup account.

[momo]

You can accumulate your stocks/ETFs with DBSVickers/any other brokers, then when the value of the stocks/ETFs reaches $10000, transfer to Saxo to setup account.

Hi,

I don't really understand this part. Do you mean transfer your CDP ETFs to be under Saxo's custody?

[choozm]

You can accumulate your stocks/ETFs with DBSVickers/any other brokers, then when the value of the stocks/ETFs reaches $10000, transfer to Saxo to setup account.

Hi,

I don't really understand this part. Do you mean transfer your CDP ETFs to be under Saxo's custody?

I transferred UK- and US- listed ETFs from POEMS and optionsXpress to Saxo. These ETFs are not held in CDP, but by the broker's custodian.

[momo]

Hi,

So has anyone confirmed that commission is GBP 8 now? Website still shows GBP 15.

Anyway, is there a newbie's guide to opening account with Saxo, how to make payment (in SGD), how dividends are handled, how dividends' tax is refunded, etc?

Specifically, how do you make payment for your ETFs that you buy? Do you have to transfer money through cheque first before making any buys, or can you buy first then by T + X days transfer money through cheque? If it is the former, how do you withdraw unused cash? If it is the latter, how many days is X, and what if your cheque takes longer than X days to clear?

In any case, what should the first step be? Submit account opening form, then after account is approved transfer $10,000 into it through cheque?

Seriously considering proceeding with Saxo if it is really GBP 8 and they can just add support for any LSE listed ETF which is not listed on their website (eg iShares MSCI World).

[Hulumas]

I am studying now!

[PJL001]

if I am not mistaken, if you open an account with an amount less than S$20,000/-, it will be considered as a mini account, and being so, you have no access to the ETFs market. You have to open the account with more than S$20,000 in order to have that access. Please check.

[momo]

Oh and I'm confused by their many account types too.

Which is the basic account (with minimum amount to start with) that allows trading ETFs on LSE, and also allows to do the following:

but Saxo doesn't have iShares MSCI World at LSE ...

You can email your broker to add it. I did that with iShares MSCI Europe (IMEU) at LSE.

[choozm]

Hi,

So has anyone confirmed that commission is GBP 8 now? Website still shows GBP 15.

Anyway, is there a newbie's guide to opening account with Saxo, how to make payment (in SGD), how dividends are handled, how dividends' tax is refunded, etc?

Specifically, how do you make payment for your ETFs that you buy? Do you have to transfer money through cheque first before making any buys, or can you buy first then by T + X days transfer money through cheque? If it is the former, how do you withdraw unused cash? If it is the latter, how many days is X, and what if your cheque takes longer than X days to clear?

In any case, what should the first step be? Submit account opening form, then after account is approved transfer $10,000 into it through cheque?

Seriously considering proceeding with Saxo if it is really GBP 8 and they can just add support for any LSE listed ETF which is not listed on their website (eg iShares MSCI World).

When you open a Saxo account, you will have a non-interest bearing cash account (in SGD or USD or the currency you choose).

To buy, transfer money through cheque first, when the money is deposited into Saxo cash account, then you can buy.

Dividend and dividend tax refund will be credited into Saxo cash account.

To withdraw unused cash, call/email your broker to issue cheque. (This is what my broker told me to do but I have not done this)

To open account, you can "Submit account opening form, then after account is approved transfer $10,000 into it through cheque" or Submit account opening form with cheque.

[momo]

When you open a Saxo account, you will have a non-interest bearing cash account (in SGD or USD or the currency you choose).

To buy, transfer money through cheque first, when the money is deposited into Saxo cash account, then you can buy.

Dividend and dividend tax refund will be credited into Saxo cash account.

To withdraw unused cash, call/email your broker to issue cheque. (This is what my broker told me to do but I have not done this)

To open account, you can "Submit account opening form, then after account is approved transfer $10,000 into it through cheque" or Submit account opening form with cheque.

Thanks for the clear explanation.

Golden question left, is it GBP 8 or still GBP 15?

[choozm]

Best to call Saxo to clarify GBP 8 or 15.

[momo]

Wow there's a new comment at choomz's blog and that someone said he/she transacted and the commission was 8 GBP! And that someone would "like to reassure momo on sgfunds about this".

Anyway got a question:

According to the Client Withdrawal Request Form, it says

Note: You must maintain a minimum balance of SGD1,000 or equivalent (for Mini-Trader) and SGD5,000 or equivalent (for Saxo-Trader) in your account, in order to maintain active account status. Withdrawals causing the balance to be less than the minimum requirement stated may result in closure of account and full balance after interest booking (if any) being paid out. Once the account has been closed, you are required to re-submit a new completed Client Application Form to re-activate your trading account.
Withdrawals are subject to a minimum of SGD600 or equivalent and please make sure you submit a fresh signed request each time.
Saxo Capital Markets Pte. Ltd. does not deduct any charges for processing withdrawal request.

Question is, does minimum balance of SGD1,000 here refer to the remaining cash balance, or total of cash and holdings?

[momo]

Hi,

1. Anyone can help explain what these 2 fields mean? Thanks.



2. The prices shown in Saxo are delayed by 15min. If I just want to login and buy immediately at the current price, how should I go about doing so?

3. How to see the exchange rate (exchange to SGD) used by Saxo when you buy? Or rather, how to know the total cost (including commission) in SGD? I need to know in order to plan my buy orders.

4. What is the trading hours in SG time for London Stock Exchange (LSE)? Where/how do you check if it is a non-trading day?

5. How to see whether the correct amount of dividend has been credited into your Saxo account? I read from choomz's blog before that Saxo seems to withhold a certain portion of the dividend (although they eventually credit it back).

6. It seems like you can just use internet banking fund transfer (eg DBS as it can indicate the Client ID as the sender's name) to deposit cash into the Saxo account. Do you guys use ibanking fund transfer or mail a cheque? It appears to me that ibanking is more convenient. Any comments?

Sorry for the many noob questions. New to Saxo and LSE. Thanks.

(Btw, you can see from the above left pic that LSE commission is indeed 8 GBP.)