A Simple Guide To CFD Brokers In Singapore

CFD Brokers

In the past, our trading options were limited to a single market, often requiring a broker to execute trades on our behalf. But now, with the rise of online brokerages, we have the freedom to trade independently across a wide array of markets and securities. One notable option that has become popular among retail traders in Singapore is Contract For Difference (CFD) trading. CFD brokers are financial instruments that enable us to predict price movements in both directions—whether it’s going long or short.

Unlike traditional securities traded on exchanges, CFDs are offered by brokers as over-the-counter (OTC) instruments. This means we don’t own the underlying asset; instead, we profit or lose based on the difference between the opening and closing prices of the contract.

The best thing about CFD trading is the ability to use leverage. By needing only a small portion of the total position value as a margin—usually between 5% to 25%—we can participate in markets beyond the limits of our initial capital. While this leverage can increase both profits and losses, it provides the opportunity for increased short-term gains.

Types Of CFD Brokers

When it comes to choosing a CFD broker, they can generally fall into two categories:

  • Direct Market Access Brokers
  • Market Makers

DMA brokers offer complete price transparency, they give traders direct access to the underlying market without any intermediaries. These brokers focus on fast and efficient order execution, charging a commission fee for their services.

On the other hand, market maker brokers provide price quotes that may differ slightly from the underlying market. They act as the market for traders, ensuring liquidity in real-time. Market makers typically charge a spread along with a commission fee.

The most common type of CFD brokers are usually market makers, and they tend to meet the needs of most retail traders well.

What to Look for When Choosing a CFD Broker

With so many CFD brokers to choose from, here are some things to think about when picking one:

Having access to different markets and types of investments:

Choose a CFD broker that lets you trade a lot of different things like stocks, indices, ETFs, forex, commodities, and cryptocurrencies. The more options you have, the more chances you’ll have to make good trades, even if you’re not trading those things right now.

Trading Fees Cost

Trading fee cost includes the spread, which is the difference between the buying price and selling price, and the commission fee. A broker with good prices will have lower trading fees, so you can keep more of your profits.

Leverage Limits and Overnight Fees

Using CFDs includes using leverage, which lets you control a big trade with only a small amount of money. Brokers that offer high leverage or low margin requirements allow you to do this. In Singapore, most CFD brokers have a maximum leverage of 20:1.

If you wanna be holding positions overnight then you should also think about the fees, as they can add up. Brokers with competitive fees for this let you hold positions for longer without paying too much.

Trading Platform Features and How Easy It Is to Use

Make sure the broker’s trading platform, whether on the web or desktop, is easy to understand and fits what you need for trading. Also, check out the other platforms they offer, like MT4, MT5, or a mobile app. These let you watch, make, and check your trades all at once.

Brokers Approved by MAS

Finally, make sure you trade with brokers that follow rules to ensure trades are fair and your money is safe. For investors in Singapore, picking brokers regulated by MAS might be safer than using brokers from other countries that aren’t regulated.

CFD Broker

Well-Liked CFD Brokers in Singapore

Here are some of the well-known brokers approved by MAS in Singapore:

CMC Markets Singapore

CMC Markets Singapore, started in 1989 known for its excellent service and technology. It is a top CFD provider that offers you access to over 9,000 CFDs covering forex, indices, commodities, shares, treasuries & cryptocurrencies.

You can trade with CMC Markets Singapore using their top-notch online platform, known for its advanced features and security. Alternatively, traders who make a lot of trades can use MT4 or FX Active. CMC Markets also offers trading guides and webinars to help traders.

City Index

City Index has been here since 1983 and is part of the Stone X Group. They’re known for helping both regular people and big investors trade. They let you trade over 6,000 different things, such as stocks, indices, forex, and commodities.

You can also trade with City Index by using different platforms like its Web Trader platform, MetaTrader 4 (MT4), or its mobile app. They also give you extra tools like research reports and webinars to help you make smart trades.

Interactive Brokers Singapore

Started as a market maker in 1977, Interactive Brokers (IBKR) provides services in more than 150 locations around the world to experienced investors, active traders, and large institutions. Their CFD platform lets you trade more than 8,500 global shares, along with forex and indices.

If you are active traders and investors then you can also use their main desktop platform called Trader Workstation (TWS). They also have a mobile app for iOS and Android. They also offer FXTrader if you are into forex trading, which is specially made for trading forex.

IBKR has lots of resources for traders on IBKRCampus. You can take free online courses there to learn about trading stocks, futures, options, bonds, and basic economics.

IG 

IG established in 1974 become a top player in the CFD and FX industries in the last ten years. They have more than 300,000 clients worldwide. IG offers access to a wide variety of trading options, with over 13,000 instruments available across various markets like forex, indices, commodities, shares, options, futures, bonds, interest rates, cryptocurrencies, and knock-outs.

If you trade with IG then you can using their award-winning trading platform or mobile app. They also provide ProRealTime, a web-based charting tool that helps you automate your trading and analysis. IG gives access to Level 2 data and DMA trading as well.

IG has plenty of resources for traders, including the IG Academy for learning, webinars, and IG Live—a TV channel with daily market insights.

Oanda

Oanda started in 1996 and has quickly become one of the top brokers. They offer access to CFDs in over 70 forex pairs, 18 indices, 10 commodities, and popular cryptocurrencies like bitcoin and ether.

You can trade with Oanda using their browser-based platform, MT4, or their mobile app for iOS and Android. They also integrate with TradingView. Oanda provides trading articles for learning.

Phillip CFD

Phillip CFD, part of PhillipCapital, began in 2003. They offer access to over 5,000 CFDs across 8 markets, including equities, Singapore DMA, world indices, commodities, and FX.

You can trade with Phillip CFD on POEMS 2.0 or POEMS Pro platforms, or use the POEMS CFD MT5 platform for features like one-click trading. They also have the POEMS mobile 3 app. Phillip CFD offers educational content and technical analysis ideas.

Saxo Capital Markets

Saxo Capital Markets, founded in 2006, is a well-known broker with over 1,000,000 customers. They offer access to over 8,800 CFDs in stocks, indices, forex, options, and bonds.

Saxo Capital has 5 account types: Bronze, Silver, Gold, Platinum, and Diamond, with tiered commission rates. They provide their award-winning SaxoTraderGO platform for trading with extensive charting and risk-management tools.

UOB Kay Hian

UOB Kay Hian, backed by the UOB Group, started offering CFD trading in Singapore recently. They offer CFD trading on single stocks, ETFs, and global indices.

You can trade with UOB Kay Hian on their UTRADE Edge or UTRADE CFD Pro platforms, which offer live quotes and order monitoring. They also provide daily market reports and organize seminars for clients.

Comparison Of CFD Brokers In Singapore For Stock Trading

Comparison of some of the CFD brokers in Singapore who provide single stock trading.

CFD Broker
Share Commissions
Overnight Financing Rates (p.a.)
US Stocks
Singapore Stocks
City Index
0.015 USD per share
(min 8 USD)
0.08%
(min 10 SGD)
Single Stocks:
US Market – 2.5%+SOFR
SG Market – 2.5%+SORA
CMC Markets Singapore
0.02 USD per share
(min 10 USD)
0.10%
(min 10 SGD)
Single Stocks:
US Market
+/-2.5% + SOFR
SG Market
+/2.5% + SORA
IG
0.02 USD per share
(min 10 USD)
0.10%
(min 10 SGD/for shares denominated in US dollars min 15 USD)
3%* +/- adjusted Alternative Reference Rates (ARR) benchmark
*If you’re long, you pay ARR; If you’re short, you receive it.
Interactive Brokers Singapore
0.005 USD per share
(min 1 USD)
0.11%
(min 2.50 SGD)
Single Stocks (Tier 1):
US Market
+/-1.5% + SOFR
SG Market
+/2.0% + SORA
Phillip CFD
0.18%
(min 15 USD)
0.128% – 0.18%
(min 25 SGD)
Single Stocks:
US Market
Long – 8%
Short – >2%
SG Market
Long – 6.75%
Short – >3%
Saxo Capital Markets
0.06%
(min 7 USD)
0.08%
(min 15 SGD)
Single Stocks: Long/Short
+/- 3.5%
UOB Kay Hian
0.22%
(min 20 USD)
0.25%
(min 25 SGD)
Single Stocks:
US Market
Long – 7.5%
Short – >3%
SG Market
Long – 6.5%
Short – >3%

Requirements For Opening A CFD Account In Singapore

You can open a CFD account in Singapore if you are over 18 years old. You should complete the Customer Knowledge Assessment (CKA). When you start a CFD account, the broker will give you a form to fill out and send back.
You can open as many CFD accounts as you want with the same broker or different brokers unless they have specific rules against it.

Start with a Demo Account

If you’re new to CFD trading, try opening a demo account with a broker. Since CFDs use leverage, it’s crucial to know the risks before trading live.

Once you’re comfortable with how CFDs work, you can switch to a live account and start trading.

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