How to Buy Stocks in Singapore in 5 Easy Steps (2024) + Tips

Investing in stocks is one of the best financial decisions you could make. And the earlier you start, the more gains you’ll likely enjoy.

I randomly looked at 5 popular stocks off the top of my head, and here are their gains in the past 5 years:

Stock	% Gain in the Past 5 Years (26 Apr 2019 – 25 Apr 2024)
Amazon (AMZN)	81.06%
Google (GOOG)	153.26%
Microsoft (MSFT)	214.93%
Apple (AAPL)	230.89%
Tesla (TSLA)	933.99%

Looking at results like these, I wouldn’t wait another 5 years to start investing. It’s best to get right to it.

Here’s how to buy stocks in Singapore in 5 easy steps.

Step 1: Open an investment brokerage account

Stocks cannot be bought at a shop and taken home in a plastic bag. To buy and sell your stocks, you’ll need to sign up for an account with an investment brokerage. A brokerage is a company that acts as the middleman between you and the stock exchange.

Brokerage accounts charge various fees like commissions (usually a percentage of each trade), platform fees, custodian fees, and even inactivity fees. You can’t totally avoid fees, as that’s how brokerages make money. But it’s vital to compare different brokers to find one that offers the lowest fees for the markets you intend to invest in.

If you’re trading SG stocks, I recommend using Webull. They currently have a promotion where you can enjoy zero commissions on SG stocks for 3 years. I’m not sure how long they can continue to offer that, so take advantage of it while you can.

As for US stocks, your best bet, in my opinion, is Saxo Markets. They have the perfect combination of low fees and a professional, easy-to-use platform.

A quick word of advice: don’t just go for the cheapest broker you can find. Price is definitely one of the top priorities, but the user interface of the trading platform and the trustworthiness of the broker are crucial, too. Remember, you’re going to be using the platform to place and monitor your positions, and you’re likely going to end up having a large portion of your savings with that particular broker.

Brokers like Webull, Saxo, Interactive Brokers, and Moomoo have very low fees, but note that they hold the shares you buy in custodian accounts. This means you don’t officially own the shares. To be an official shareholder, you must open a Central Depository Account (CDP) and go with a broker like DBS Vickers. The fees are much higher, but you’ll get certain privileges, such as attending AGMs (annual general meetings). Personally, I have enough meetings to attend, and I don’t need more. I just stick with custodian brokers to enjoy low fees.

Read more: How to Decide Which Investment Brokerage in Singapore Is Best For You

Step 2: Fund your investment brokerage account

Before you can start trading, you need to transfer money to your account. Your brokerage might have a minimum funding requirement, so you’ll need to ensure you have the requisite amount.

Brokerages usually accept multiple funding methods, such as the following:

• FAST transfer via Internet banking
• PayNow transfer
• Remittance from overseas, such as with services like TransferWise

Step 3: Decide on what stocks to invest in

Well done. You now have a fully funded brokerage account—that was the easy part.

What do you invest in now? If you don’t already have a plan, here are some safe and worthwhile options.

Blue chip stocks

“Blue chips”, such as Singtel, DBS, and Keppel, are giants in Singapore’s economy. They may not grow crazily like certain overseas companies (think Tesla), but they’re widely regarded as super-stable. Many investors hang on to these stocks for long periods and collect dividends.

If your plan is to accumulate stocks that offer dividends, make sure you do your research first, as not every stock offers dividends.

Read more: The MoneySmart Guide to Buying SGX Stocks

Exchange Traded Funds (ETFs)

Want to know what’s even safer than blue-chip stocks? Welcome to ETFs. The most popular ETFs, like the S&P 500, and not only safe, but they have great potential for reliable returns. When you invest in an ETF, you are investing in a basket of stocks. Sticking with the example of the S&P 500, you’ll be investing in the 500 biggest companies on the US stock exchange.

As someone who isn’t interested in stock-picking, ETFs are my favourite form of investing.

Read more: The Total Beginner’s Guide to Investing in ETFs

Real Estate Investment Trusts (REITs) 

Ever dreamed of being a landlord? REITs like Mapletree, CapitaLand and Ascendas allow you to be part-landlord at various commercial properties, such as shopping malls and office buildings. The big names are considered fairly foolproof in the long term (COVID-19 notwithstanding) and tend to pay out fat dividends.

Read more: The MoneySmart Guide to Investing in REITs

Step 4: Buy your first shares!

Once your funds have been cleared, you can buy shares using your broker’s desktop or mobile platform.

I’m not here to tell you what strategy to use, but if you have never invested before and don’t have oodles of cash, you might want to keep things simple by spending a fixed amount every month on a generic ETF such as the S&P 500. This method is called dollar cost averaging and helps you make investing a regular habit.

Read more: The STI ETF Step-by-Step Guide — What Is It and How To Start Investing

One major benefit of dollar-cost averaging is that you don’t need to bother about timing the market. The idea is that over the long term, ETFs will rise and fall, but they should always end up higher than when you first started investing. By buying a small, fixed sum every month, you’re spreading your risk through many ups and downs. All you need to do is be disciplined enough to put aside the money to invest each month.

If you’re more of a risk taker and you want to go all-in with a particular stock, I’m not going to stand in your way. Just make sure you’ve done your research, and you’re not just buying into the hype.

Step 5: Chill out and (hopefully) profit

The Singapore stock market tends to favour passive investors who just want to sit back and collect regular dividends rather than search for stocks with high growth potential.

On the other hand, if you’re looking for “growth” stocks like Tesla, you’ll need to buy them on overseas exchanges. Which, actually, is also really easy. See our guide to buying stocks on the US market for more.

Most dividend-yielding stocks payout 4 times a year, i.e. every quarter. There are some exceptions, however, with certain stocks dishing out dividends anywhere from 1 to 12 times a year.

Some brokerages give you the option to automatically reinvest cash dividends. If you don’t pick this option, you will receive the dividends in cash. You can then choose to either promptly reinvest the cash in line with the dollar cost averaging method or hold onto it until you find good deals on the market.

And… that’s all there is to it! For the average Joe who just wants to buy and hold some quality stocks, investing passively for the long term is really not rocket science.

Of course, depending on how closely you want to manage your portfolio, there might be more to learn. But for now, you already know enough start. Good luck!

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