Central Depository Account (CDP) and MAS Bonds

Disclaimer
Whatever written is purely my own opinion and should not be taken as professional advice as I do not have any professional training in this field. However, please do read it any way, and give me feedback about my opinion.
To know more about me, please take a look at the post about my profile.

Hi,

CDP account is an account for you to keep your portfolio of stocks, bonds and many other stuffs.
This account is owned by the government and you can only have one of it. You do not require to close it either if you already have it as it is better to have it than not to have it.

So why do you want to make this CDP account?

Simple. So that you can buy MAS bonds.
As stated in their website, one of the things required is a CDP account, as well as a bank account with the participating banks.

In this site, it states the benefits of this bond and more details could be found in the news everywhere.

How do you make a CDP account?

The next most important question: how to make a CDP account?

Firstly, this account is a pain in the ass to make. You would require to be physically there to sign the form in front of the officers. Hence, postage is out of the way.
Secondly, if you were to make the CDP account with CDP themselves, you will have to visit during office hours, which is also a problematic thing.

So the next best way to do it is to open with a Securities Company.
A Securities Company is a company who provides a trading platform for you to buy and sell stocks. In that process, they would earn commission from your transaction.
If you tell them you want to open a Securities Account, they would first ask you for CDP.
Tell them no and they will start to help you apply for one as well.
Some examples of Securities Companies are Maybank Kim Eng, Ocbc Securities, Lim and Tan Securities, Philips Securities etc.

Among them all,
I find it easiest to open your CDP with OCBC securities.
This is because a call to IOCBC would tell you that you may open an account at most OCBC branches. And the best part about OCBC branches is that they have long operating hours, as well as Weekend banking.

So for people who are working, my suggestion is to open with them to get your CDP started up.

Once you get your CDP, remember to ask for your online services of CDP by calling them! Then you would receive your online banking pin, and your ONEKEY. This is so that it would be easier for you to track what you have in your CDP.

As for trading, most Securities charges a basic of $25sgd commission for trades in Singapore Exchange, a 0.275% clearance fee, a 7% GST and 0.0325% SGX trading fees. This seemed like a small number, but if your contract value is high, its pretty substantial.
So, before you trade, you would need to know when and if it is possible for you to break even the transaction fees and still make a profit.


Regards
Benjamin Chai