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Investing in multi regions

This was an idea which I had tests over the past few years. Quite a bit of trial and error along the way. While dependent on market conditions, it remains to be seen on the feasibility as there are geopolitical and currency risks involved.

Just like the saying that we should try not to put all our eggs in one basket. Sometimes it happens that, in practicality, it takes time to work on it effectively.

A case of multimarket

There are two methods to invest online via a single broker multiple markets directly. The bottom line to the equation will be the accessibility and fees involved. While in Singapore, the financial conditions allow for accessibility to multiple markets through a single broker, sometimes the costs involved can be a turn off to investing linearly.

Next will be the execution phase. So comes the next option of globe-trotting to invest. One would consider fees involved with each trade, custody fee which is charged monthly and the charging structure as well as if there is any market access fees and account maintenance fees involved.

And last but not least, the basic fundamental is to understand the primary and secondary objective of investing, before stepping foot it.

An example to set the illustration in the case study below for a fair Apple to Apple comparison.

Using a local brokerage firm for access to invest in – MY, HK, SG & US*

In this example, we will use Philip Securities/Maybank Kim Eng.

Brokerage fee for Local Market: S$25 (min per trade)
Custody fee: NA, as shares are stored in the CDP.

Brokerage fee for Overseas Market:
Custody fee: S$2 per counter month, waived if there are 2 trades per month or 6 trades per quarter.

Using multiple Brokers for access to invests in – MY, HK, SG & US*

In this example, we will use various brokerage platforms – Standard Chartered Singapore, Maybank Investment Berhad, Malaysia & HSBC Hong Kong.

Brokerage fee for Local Market: S$10 (min per trade)
Custody fee: S$0 (Shares are under nominees account by bank)

Brokerage fee for US Market: US$10 (min per trade, via Standard Chartered Singapore)
Custody fee: S$0 (Shares are under nominees account by bank)

Brokerage fee for MY Market: MYR$10 (min per trade, via Maybank Investment Berhad, Malaysia)
Custody fee: $0 (Shares are stored in CDS)

Brokerage fee for HK Market: HKD100 (min per trade, via HSBC HK)
Custody fee: HKD25 monthly (Shares are under nominees account by bank)

Conclusion

It might be more cost effective to have the shares under individual countries of wherever the brokerage is cheaper. However, there is the hassle involved in ensuring that the account is well funded and that administration of individual market account is worth the effort if you are trading actively for the long run.

Note*: Comparisons based only upon custodian fees and trading fees charged by brokers. Excludes any other transaction levy and taxes imposed by each individual market stocks exchange.

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