Anonymous
Can I trade without opening an online trading account?
I opened a CDP account many years ago and bought some Singtel shares (can't recall how i got them). Recently, I decided to buy some shares with potential. My trading friends said only 1 account will do; no need for trading account. I approached CDP but they said trading account needs to be opened. I read many articles; all the answer point to the need to open. Kindly clarify why can't why I trade with just CDP account?
I have limited resources to trade. I want to trade on my own affordably.
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Billy
18 Jul 2020
Development & Acquisitions Manager at Real Estate Private Equity
Hi Anon,
A CDP account is like a bank account for stocks. Stocks that are bought / sold are then withdrawn / deposited into your CDP account. However, to trade stocks, you need access to the stock exchange / market, something that only brokerage / trading firms have. Therefore, you are required to set up a brokerage account with a trading firm (FOC) and you will only need to pay when you trade (depending on which brokerage firm you open an account with). Therefore, I think what your friends are referring to is 1 trading account (CDP is not a trading account).
On the question of how you obtained the Singtel shares without even opening a brokerage account, I think this article solves your mystery -- https://dollarsandsense.sg/older-singaporeans-n...
Anyway, a simple graphic to illustrate the process:
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