Saxo Capital Markets (Singapore) - Thoughts? Experiences?

[AyG]

Another thread in this forum mentioned Saxo Capital Markets in Singapore as a broker. I've used Internaxx (now TD International) in Luxembourg for over a decade now and thought it was time to review whether I might be better off switching. From a purely cost perspective, I would. I'd be saving several hundred pounds a year - though that's offset by the costs of transferring my positions from Internaxx at EUR 75 each. I'd be very interested to hear about others' experiences with Saxo in Singapore.

My initial investigation has identified the following pros and cons:

Pluses
- Cheap transaction charges
- No custody fees
- No European Union residence proof each year
- Similar timezone
- Mobile version of website

Minuses
- 30% withholding tax on US securities income (no W-8BEN support)
- Minimum of SGD 100,000 for multicurrency account
- Reporting is more geared towards traders than investors. (I'll probably have to maintain more detailed records myself.)
- Website doesn't work properly on Linux (uses Silverlight)
- Website doesn't work properly for Chrome browser

Any thoughts, anybody?

[AyG]

Another minus: they don't cover the London Stock Exchange AIM.

Bit surprised, though, that nobody has any experience with them to report.

[Naam]

- No custody fees

incorrect information.

[AyG]

- No custody fees

incorrect information.

Saxo Custody Fees.jpg

Sorry. Should have been more precise. No custody fees for equities. (That said, from next year they're also introducing a charge if you don't trade at all over six months.)

[Naam]

- No custody fees

incorrect information.

Saxo Custody Fees.jpg

Sorry. Should have been more precise. No custody fees for equities. (That said, from next year they're also introducing a charge if you don't trade at all over six months.)

another minus is that you can only transfer cash to an account which is in your name. not sure whether they offer credit/debit cards.

[paddyjenkins]

regarding w8ben and tax withholding on US equities....a w8ben doesn't stop tax withholding, that depends on the tax treaty between the country and the US. for example a resident of the UK would still have 15% withheld as they have a tax treaty, but a resident of singapore would have 30% withheld as they don't.

i believe thailand does have a tax treaty so in theory 30% should not be withheld but something will be, not sure what the rate will be for thailand.

but in general i see no advantage of saxo over interactive brokers and they certainly do use w8ben's and are a LOT cheaper than saxo. when i trade in IB i generally save a minumum of one starbucks coffee and often a lot more than that.

i do have a saxo account but use it only for singapore stocks as for some reason IB dont offer them, to me at least.

[paddyjenkins]

btw, by withholding of 30%, i only mean on dividend payments. but if you dont have a w8ben and should have one the danger is that 30% of the sales proceeds may be withheld when it comes to selling a US stock you own. so always make sure your w8ben is uptodate.

Edited December 19, 2013 by paddyjenkins

[panork]

I have used Saxo Capital Markets (Singapore) as a "buy and hold" share trader since early this year. Since then the fee structure has changed three times.

In March the stock trading commissions were substantially increased, then a fee of $100 was introduced if there is no trade for 180 days, and with effect from 1January 2015 an annual custody fees with minimum monthly fees(with the exception of SGX stocks) will apply for stocks.

Can anybody recommend another regional stock broker with competitive fees and, preferably access to the Dubai Financial Market?

[AyG]

The changes really irks me. I paid substantial fees to Internaxx (Luxembourg) to transfer my investments to Saxo. The main motivation was primarily to save on custody costs and enjoy reduced trading costs. For me the payback period was about 2 1/2 years.

Internaxx charged me 0.2% custody fees, and commission on a single trade of GBP 15,000 on the LSE would be GBP 25.

When I moved to Saxo (less than a year ago) the was no custody fee for equities, and trading was substantially cheaper.

Now Saxo will charge 0.12% custody fees, and commission on the same trade will be GBP 20.

The payback period will now be over 5 years. Had I known what was coming I wouldn't have transferred.

[Naam]

Saxo was quite successful luring European and Asian retail investors with their minimum investment amount who have no chance being accepted by any of the Singaporean multinational banks.

now Saxo is tightening the screws.

[AyG]

TD International (formerly Internaxx) have cut their charges significantly, so I've finally bitten the bullet and instructed Saxo to close my Singapore account and transfer all my holdings back to Luxembourg.

For me it's proven an expensive exercise whilst I was trying to save costs.

(The only ray of light is that Saxo agreed to waive the transfer fees for me after I explained the causes of my dissatisfaction.)

[paddyjenkins]

As i understand the situation, custody fees are not charged for stocks traded on the SGX. So Saxo still seems to be a convenient account for buying and mostly holding local stocks. For bonds they seem to charge a pro rata custody fee even for local government bonds which means its not worth bothering with such low yields. But for very occasional situations Saxo can provide access to quite exotic animals such as Russian government bonds etc. so they may be worth asking prices from, assuming the custody fees etc are going to be small compared to the potential gain or loss scenarios. The alternative for money kept in Singapore would be to use a local or singapore branch international bank for bonds, but when that bank charges a standard 2 point spread as well as 250k minimum etc it means you hand over 5k in commission for one round trip. Which means back to Saxo if IB or other brokers cant offer the same instrument. Brokers such as IB allow multi currency accounts, so can hold USD, my main currency, but also SGD, GBP etc. Saxo also allows multi currency sub accounts, but their culture of sneaky charges and high commissions has deterred me from going very far in that direction.i think Saxo is more of a low activity account for spare cash as opposed to a main trading account, as for that they are just too expensive and too sneaky. Perhaps its time to take another look at TD, or see if the private banks have improved their offerings. The trouble i recall with TD is no bond access at all. May main problem with private banks is that i hate trading over the phone, i like everything without telephones involved and i hate dealing with any kind of RM.

Edited March 28, 2015 by paddyjenkins

[wordchild]

it might be worth having a look at OCBC Securities; I have been using them for several months now and have been pretty happy with the service. For me, one big advantage they have over saxo is the ability to trade offline (with the dealing desk) when you need to eg in UK small cap (which Saxo cant trade at all). The range of markets offered is also reasonable. The online trading portal is fairly basic when compared to Saxos but its seems reliable and worked fine for me so far. Published commission rates are high but they are somewhat flexible and they will discount these if you are a premier customer of the bank and also even further if they sniff a decent sized portfolio. also custody charges waived subject to account activity . I would say they are a good option for someone who is less trading orientated more buy and hold and values the depth of the equity market coverage.

Edited March 28, 2015 by wordchild

[Naam]

TD International (formerly Internaxx) have cut their charges significantly, so I've finally bitten the bullet and instructed Saxo to close my Singapore account and transfer all my holdings back to Luxembourg.

For me it's proven an expensive exercise whilst I was trying to save costs.

(The only ray of light is that Saxo agreed to waive the transfer fees for me after I explained the causes of my dissatisfaction.)

what custodial fees does TDI charge and what proof of non-EU residence is required to avoid EU withholding tax?

[AyG]

what custodial fees does TDI charge and what proof of non-EU residence is required to avoid EU withholding tax?

From April 1st they'll be charging a flat 25 per quarter, or 45 if you place no trades during the previous three months.

Commission rates will be, for trades up to 250,000:

US, Canada, UK: 14.95

Euronext, Xetra: 29.95

Other markets: 49.95

As for proof of residence, I just email them a copy of my annual extension of stay and passport information page each year.

[AyG]

For some reason all the Euro symbols have disappeared from my previous posting. All the figures are in Euros.

[Naam]

what custodial fees does TDI charge and what proof of non-EU residence is required to avoid EU withholding tax?

From April 1st they'll be charging a flat 25 per quarter, or 45 if you place no trades during the previous three months.

Commission rates will be, for trades up to 250,000:

US, Canada, UK: 14.95

Euronext, Xetra: 29.95

Other markets: 49.95

As for proof of residence, I just email them a copy of my annual extension of stay and passport information page each year.

thanks for the info! these fees are really peanuts but i wonder how TDI recovers the actual custodial fees charged e.g. by Euroclear and/or Clearstream.

[paddyjenkins]

what custodial fees does TDI charge and what proof of non-EU residence is required to avoid EU withholding tax?

From April 1st they'll be charging a flat 25 per quarter, or 45 if you place no trades during the previous three months.

Commission rates will be, for trades up to 250,000:

US, Canada, UK: 14.95

Euronext, Xetra: 29.95

Other markets: 49.95

As for proof of residence, I just email them a copy of my annual extension of stay and passport information page each year.

I just took a quick look again at their website. It says custody fees are waived for frequent traders, so non frequent traders will have to pay it. I also noticed they still appear to provide no access to bonds.

[AyG]

I just took a quick look again at their website. It says custody fees are waived for frequent traders, so non frequent traders will have to pay it. I also noticed they still appear to provide no access to bonds.

The website hasn't been updated for the new rates which don't come into effect until later this week.

The email I received from them announcing the new fee structure doesn't mention any different treatment for frequent traders.

And I think you're right, to the best of my knowledge, they don't provide bond trading.

[Naam]

I just took a quick look again at their website. It says custody fees are waived for frequent traders, so non frequent traders will have to pay it. I also noticed they still appear to provide no access to bonds.

The website hasn't been updated for the new rates which don't come into effect until later this week.

The email I received from them announcing the new fee structure doesn't mention any different treatment for frequent traders.

And I think you're right, to the best of my knowledge, they don't provide bond trading.

no bond trading would be an explanation. because the fees the actual custodian charges are considerably higher.

[Crisu]

I am also looking for a good broker or bank in SG to trade bonds on european stock market online if possible.

[Naam]

I am also looking for a good broker or bank in SG to trade bonds on european stock market online if possible.

bond trading with mouse-clicks like Comdirect, Consors, Flatex, Targo et al is (unfortunately) not available in SG.

[Crisu]

i thought its not possible online.

but can you recommend me any other bank where you can act well and cheaply without having 5 mio. eur and can trade on european bond markets or otc?

[Crisu]

I am also looking for a good broker or bank in SG to trade bonds on european stock market online if possible.

bond trading with mouse-clicks like Comdirect, Consors, Flatex, Targo et al is (unfortunately) not available in SG.

i thought its not possible online.

but can you recommend me any other bank where you can act well and cheaply without having 5 mio. eur and can trade on european bond markets or otc?

[Naam]

I am also looking for a good broker or bank in SG to trade bonds on european stock market online if possible.

bond trading with mouse-clicks like Comdirect, Consors, Flatex, Targo et al is (unfortunately) not available in SG.

i thought its not possible online.

but can you recommend me any other bank where you can act well and cheaply without having 5 mio. eur and can trade on european bond markets or otc?

act "well" yes, "cheaply" nowhere in Singapore. compared to the directbanks i mentioned above even Saxo is extremely expensive. other SG banks have either silly restrictions e.g. non investment grade a "no-no" even when the corporation has a triple A rating but the bond you want to buy is subordinated.

you need a fistful of millions to negotiate slightly better conditions with JB, UBS, CS, BNP or EFG. i am since 6 years with EFG after 5 years each with CS and UBS. they (EFG) are beancounters par excellence (bordering ridiculousness) but i managed "satisfactory" conditions compared to other banks.

[paddyjenkins]

If of course its US treasury bonds then they can be traded cheaply within many brokers, as well as US corporate bonds, munis, agency bonds. Also, futures on US, EU, UK, Japanese and even Korean bonds can be traded very cheaply using many brokers. For all the above IB is one choice, but there are others. Its the non US bonds that are the problem....indonesia, russia, australia etc. Saxo does provide broad access, but whether you will be happy with their pricing is another question. But if you compare to the actual banks, Saxo might be a better choice, assuming you use limit orders, and just see if you get filled close enough to mid and accept a certain liquidity risk. The banks seem to vary from 2 point spreads on 250k minimum, to 1 point spread on 100k minimum, and an account balance of a million plus. So for the banks its a step above being an average preferred customer, but you don't need 10s of millions. Personally id like to trade at the click of a mouse, not over the phone or chat, and want prices and spreads low enough to average in and trade on 20 or 30 bp moves, which is obviously harder when charges and spreads are greater than one point, apart from for longer duration bonds. Bonds are increasingly going electronic so maybe things will improve, but at the moment its a matter of compromising. I generally just stick to the US markets for the above reasons.

Edited April 1, 2015 by paddyjenkins

[Crisu]

I am also looking for a good broker or bank in SG to trade bonds on european stock market online if possible.

bond trading with mouse-clicks like Comdirect, Consors, Flatex, Targo et al is (unfortunately) not available in SG.

i thought its not possible online.

but can you recommend me any other bank where you can act well and cheaply without having 5 mio. eur and can trade on european bond markets or otc?

act "well" yes, "cheaply" nowhere in Singapore. compared to the directbanks i mentioned above even Saxo is extremely expensive. other SG banks have either silly restrictions e.g. non investment grade a "no-no" even when the corporation has a triple A rating but the bond you want to buy is subordinated.

you need a fistful of millions to negotiate slightly better conditions with JB, UBS, CS, BNP or EFG. i am since 6 years with EFG after 5 years each with CS and UBS. they (EFG) are beancounters par excellence (bordering ridiculousness) but i managed "satisfactory" conditions compared to other banks.

I was in contact with EFG too and they offered me 0,5% for a bond trade and a min. account value of 1 Mio. CHF. The others (JB, BNP) not better (cheaper).

May i ask you how much they ask you?

[Naam]

I was in contact with EFG too and they offered me 0,5% for a bond trade and a min. account value of 1 Mio. CHF. The others (JB, BNP) not better (cheaper).

May i ask you how much they ask you?

can't publish my arrangement because a few EFG clients are reading this forum. but i think i told you already. we had contact last year via bondboard and you have my email address. for your information... Schenk left EFG, set up his own shop in Singapore and took "my" girl with him whom i "trained" for a couple of years. had for a few weeks a hard time with her successor. problems now solved but the real problem is their trading desk where you have to use clout to get OTC tradeable bids and offers instead of indications which are available with a few mouseclicks even for dummies.