A CFD is an agreement between two parties to settle, at the close of the contract, the difference between the opening and closing prices of the contract, multiplied by the number of underlying shares specified in the contract.
To open a CFD account, you may contact your Trading Representative or call personally at your stock broking office.
A CFD account will be opened within 2 working days from the date you sign the CFD documents. A minimum cash deposit of S$2,000 is required before you can commence trading.
You can pledge a combination of cash (minimum S$2,000) and share collateral (minimum S$10,000). Cash deposit placed must be 10% of the market value of share collateral. For example, if you pledge shares with a market value of S$30,000, the required cash deposit is $3,000.
You can pledge most of the counters traded in the SGX Mainboard and Catalist. You can refer to your stock broking house's Non-Marginable Securities List for shares that cannot be pledged.
You can sell the shares you pledge as collateral in your CFD account. However, you have to sell the shares through your Cash account and inform your Trading Representative to amend the sales to your CFD account on trade day. The sales proceeds will be credited to your CFD account
You can trade up to 5 times the amount of cash deposit and/or marginable securities.
There are counter limit restrictions. You have to monitor all orders to ensure strict compliance with the following counter limit restrictions.
CFD Trading LimitLong Position Per CounterLong Position Per CounterShort Position Per CounterShort Position Per CounterQtyValueQtyValueUp to $100,000250000$40,000.00250000$40,000.00> $100,00050000040% of CFD trading limit or $100,000 whichever is lower 250000$40,000.00
If your CFD A/c is tagged to a Trading Representative, you have to check the applicable limit restrictions with your Trading Representative.
Queuing is allowed for CFD trades. Once you have keyed in the order, you will see the order status as "Pending" in "Today's Orders".
The status sometimes changes from "Pending" to "Rejected". This happens when the CFD trade is not accepted by your stock broking house.
Your CFD trades may be fully filled or partially filled. You will see the order status as "Filled" or "Partially Filled" respectively in "Today's Orders" during market hours .
You can withdraw a CFD trade that is not filled. For partially filled orders, you can only withdraw the balance quantity as reflected in "Today's Orders".
CFD trades will be closed out on a First-In-First-Out (FIFO) basis.
E.g.
Day 1 Buy 6 lots of ACCS
Day 5 Buy 4 lots of ACCS
Day 10 Sell 8 lots of ACCS
The 6 lots bought on Day 1 would be squared off first, followed by the 2 lots bought on Day 5. Hence, you will hold a net 2 lots long ACCS position.
Your CFD trades can be partially closed.
E.g.
Day 1 Sell 5 lots of Chartered
Day 10 Buy 2 lots of Chartered
Your client position will reflect a balance of 3 lots of Chartered
The Contract Value of a CFD is the number of underlying shares in the contract multiplied by the price of the underlying security.
Brokerage tier for Online CFD Trades:
Contract Size Brokerage Rates *
Min. Brokerage S$25
Up to S$20,000 0.22%
>S$20,000 to S$50,000 0.18%
>S$50,000 0.15%
Brokerage tier for CFD Trades placed through your Trading Representative:
Contract Size Brokerage Rates *
Min. Brokerage S$30
Up to S$20,000 0.35%
>S$20,000 to S$50,000 0.30%
>S$50,000 0.25%
For opening a long position, the finance charge of 6.5% per annum will be levied. (The interest-free period will be up to T+3 market days.)
For opening a short position, the finance charge of 4% per annum will be levied. (The interest-free period will be up to T+3 market days.)
For all closing positions, the brokerage charge will apply.
Charges are subject to change from time to time.
Each CFD has a tenure of 30 days. You have the option of closing off your position on or before expiry date depending on your view of the price of the underlying security. The CFD contract has to be closed off on or before the expiry date, otherwise a rollover will be initiated.
When a rollover is initiated, a new contract will be created, based on the last done price of the underlying share on the expiry date. Commission and finance charge on the new contract will be levied. If an expiry date falls on a weekend or public holiday, the effective expiry date shall be on the market day before the weekend or public holiday.
Note: The interest-free period is not applicable to rollover contract.
Your CFD account will only be adjusted in respect with cash dividend attributable to the underlying security as follows:
(a) If you hold a CFD long position, the net dividend will be credited to your CFD account
(b) If you hold a CFD short position*, the gross dividend will be debited from your CFD account
* You are required to close off any open CFD short positions when the dividend attributable to the underlying security of any CFD is payable in a currency other than Singapore Dollars.
For all other corporate actions, you are required to close off any open CFD positions as follows:
Long CFD position: 3 market days before ex-date
Short CFD position: 7 market days before ex-date
Notwithstanding the foregoing, your stock broking house reserves the right to close all open positions relating to the underlying security before the ex-date for any corporate actions.
A confirmation advice will be sent to you to notify you of your CFD trades. In addition, you will receive a monthly statement reflecting all CFD transactions and fees charged to your CFD account.
8% interest per annum on a daily rest will be charged on a debit balance in the CFD account. You will be required to settle all outstanding debit balance upon receipt of the monthly statement.
You must maintain a margin percentage of at least 20%. No new positions are permitted unless additional collateral is furnished to bring the margin percentage to not less than 20%.
The margin percentage is computed as follows:
Total Equity
---------------------------- x 100% = Margin Percentage
Market Value of Portfolio
Definition:
Total Equity = Ledger Balance* +/- Unrealised Profit/Loss + Market Value of Collateral Shares - Accrued Finance Charge - Accrued Debit Interest
Market Value of Portfolio refers to the market value of all outstanding CFD positions.
* Ledger balance = Cash Deposit - Commission (inclusive of GST) - Realised Finance Charge +/- Realised Credit/Debit Interest +/- Realised Profit/Loss
You may withdraw cash or share collateral from your CFD account, provided after the withdrawal, your margin percentage is above 20% and the ledger balance is at least S$2,000 and above 10% of the market value of your share collateral. However, for cash withdrawal in excess of $50,000/- per day, the margin percentage must be at least 30% after cash withdrawal.
A margin call is made when the margin percentage falls below 20%.
You need to top-up your CFD account within two market days from the date of the notice. For example, if the margin call is made on a Monday, you are required to top-up by Wednesday.
To top-up your CFD account, you will need to provide additional margin of cash and/or marginable securities to bring the margin percentage to not less than 20%. For top-up of marginable securities, you are required to place a cash deposit of at least 10% of the market value of the share collateral.
If you are unable to top-up, your stock broking house shall have absolute discretion and without further notice to you, liquidate the CFD account, including the shares deposited as collateral, to bring the margin percentage to not less than 20% if the margin requirement is not met within two market days of the margin call.
Force-selling shall take place when the margin percentage falls below 10%. Your stock broking house has the right to liquidate your collateral shares and/or close off all or any outstanding CFD positions to bring the margin percentage to not less than 20%. In a volatile market, you are required to monitor your position closely and if you do not wish to be sold-out, you are required to top-up with cash by 12 p.m. on the force-selling day.
There is no processing fee to open a CFD account. Charges by CDP are maintenance fees for your Depository Agent (DA) Sub-Account on a quarterly basis and fees for share transfer between your Global Securities Account (GSA) and DA Sub-Account. The maintenance fees may be waived depending on the amount traded for that quarter. Charges by your stock broking include handling fees for dividend distribution.
The CFD trading hours is between 8.30 am to 12:30 pm and 2 pm to 5.05 pm.
Overnight orders to initiate short positions are not accepted. Orders to initiate short positions can be placed only during trading hours.
Overnight orders to close off outstanding positions and initiating of long positions can be placed through the Online Trading system for the next trading day from 5.20 pm onwards. If you are placing an overnight sell order to close off an outstanding long position, you have to ensure the quantity for your sell-to-close order is not more than that of the open buy position.
Note: Orders placed by clients will still be subject to acceptance by your stock broking house. Orders placed at or near the end of trading hours may not be accepted and executed.
You can contact your Trading Representative, Helpdesk or CFD Department for assistance.
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