Contents
What is CDP?
CDP known as Central Depository account in the relation of your inquiry regarding trading in Singapore. If you want to trade stocks on the Singapore Exchange (SGX), you must fulfill this prerequisite. You can store your Singapore-listed stocks and other investments on it electronically, much like a safe.
Your securities, including those listed on the SGX-ST and Singapore Government Securities (SGS) bonds, can be safely stored in CDP. When trading securities like stocks and bonds in Singapore, a Central Depository (CDP) account is crucial for a number of reasons. This is the reason why:
1.Ownership Verification:
- An individual’s CDP account verifies who owns the stocks they own. In Singapore, bonds and equities that you purchase are electronically stored in your CDP account and act as ownership documentation.
2.Settlement:
- Trade settlement is made easier by the CDP. The CDP is used to settle transactions involving the purchase and sale of securities on the Singapore Exchange (SGX). This makes sure that securities are transferred between buyers and sellers quickly and securely.
3.Corporate activities:
- The management of corporate activities, including mergers, rights issues, bonus issues, and dividends, is another critical function of CDP accounts. Investors are able to take part in a variety of business events and decisions because these corporate actions are directly deposited into their CDP accounts.
4.Safekeeping:
The CDP serves as a centralized securities depository, offering investors a controlled and safe environment in which to hold their money. This lowers the possibility that physical certificates may be misplaced or stolen.
5.Convenience:
The trading process is streamlined when you have a CDP account. With only one account, investors can easily manage their securities portfolio without having to deal with numerous intermediaries or handle real certificates.
6.Access to Market Data:
Investors can also obtain crucial market data and updates through CDP accounts. This contains details about assets, transactions, company actions, and other pertinent information that can assist investors in making wise choices.
Documents and eligibility required
- You must be a Singapore Citizens/Permanent Residents.
- Must have NRIC (National Registration Identity Card)
- For foreign citizen, must have Passport
- Employment Pass or Work Permit (for non-residents)
- Proof of residential address
- To apply for a CDP account in Singapore, you must first open a brokerage account with a stockbroker. Your application will be aided by the brokerage firm.
- An application form sent by your brokerage company or the Central Depository must be completed and signed.
- You might be asked to submit documentation of your income or financial situation, depending on the brokerage firm’s regulations and the kind of account you’re opening.
- A CDP account’s opening and upkeep may be subject to costs. Depending on the Brokerage Company and kind of account, these costs may change.
- Must pay the required fees.