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CFD Trading In Singapore

Written By

James Barra

Written By

James Barra

James is an investment writer with a background in financial services. He has worked as a management consultant, where he delivered large-scale operational transformational programmes at some of Europe's biggest banks. James authors, edits and fact-checks content for a series of investing websites.

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Edited By

Jemma Grist

Edited By

Jemma Grist

Jemma is a writer, editor and fact-checker focused on retail trading and investing. Jemma brings a unique perspective to the forex, stock, and cryptocurrency markets and works across several investment websites as a researcher and broker analyst.

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Fact Checked By

William Berg

Fact Checked By

William Berg

William contributes to several investment websites, leveraging his experience as a consultant for IPOs in the Nordic market and background providing localization for forex trading software. William has worked as a writer and fact-checker for a long row of financial publications.

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Updated

Jul 24, 2024

CFD trading in Singapore is big business. In fact, it’s the fourth-largest CFD market globally. Here we’ll look at how traders can get started, plus answer any regulatory and legal questions.

All CFD Brokers In Singapore

What Is A CFD?

A contract for difference (CFD) is a tradable agreement to exchange the difference in the value of an asset. If we take stocks and shares as an example, you could speculate on the change in value of the Singapore Stock Exchange, or on the share price of a specific stock, without actually owning the underlying asset.

Online CFD trading is attractive partly because it’s available in so many markets. You can trade CFDs on stocks, forex, commodities, and cryptocurrency. But despite wide-ranging market access, stick to classes you understand.

CFD traders in Singapore can also benefit from leverage, meaning you can borrow money from a brokerage to increase your position size. This is also known as trading on margin. The benefit of trading on leverage is that by increasing your trade size you can amplify potential profits. Of course, it also means the possibility of larger losses.

How To Trade

CFD trading in Singapore is straightforward:

• Open an account – Most Singaporean traders benefit from instant account activation once their ID and address have been validated. Traders can then consider finance options and fund their account.
• Find an opportunity – Informed by your strategy, identify a market opportunity to use a CFD instrument, such as on stocks.
• Enter a position – On your trading platform, take a position depending on whether you think price will rise or fall.
• Risk management – Set a stop-loss order to automatically close out a trade when losses reach a certain point. Use a stop-limit order to automatically protect profits when they hit a specific level.
• Monitor & close – Keep an eye on your charting software for real-time changes to the market. If you haven’t set stop-loss and stop-limit orders, close out the trade when you’re ready.

Accounts

Which CFD account is best in Singapore will depend on user needs. Most providers have a tiered account system with varying minimum deposits. In general, the greater the minimum investment required, the more competitive the fees, the better the leverage options, and the greater the access to customer support.

Educational Resources

CFD trading in Singapore is competitive. So, the more additional educational resources you can get your hands on the better. Head to online forums, such as HardwareZone for tips from Singapore traders. Videos, newsletters and demo accounts are also all great ways to hone your CFD shares strategy, for example.

For further guidance on day trading learning, see here.

Final Word

CFD trading in Singapore is hugely popular. Giving investors access to a breadth of markets with high leverage options, CFDs appeal to traders of all experience levels. It is true the regulatory oversight isn’t as robust as in other jurisdictions, such as the UK or US. However, the best trading platforms in Singapore still make for a great environment to trade CFDs.

FAQ

How can I trade CFDs in Singapore?

To start CFD trading in Singapore, sign up at an online brokerage, fund your account, and take a position when you see an opportunity. But make sure you have a clear strategy and risk management tools in place before you put real money on the line.

Is CFD trading legal in Singapore?

CFD trading in Singapore is legal and regulated by the Monetary Authority of Singapore (MAS). All brokers should be licensed with the MAS Financial Institutions Directory. As part of your due diligence, check the provider’s website for a license number.

Part of the protection afforded to those trading CFDs in Singapore with a regulated broker is that client funds are segregated. If the provider were to go bankrupt, user funds would be protected. Regulated brokers are also required to issue prospective clients with a comprehensive list of risks.

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