You'll be able to compare two brokers on cost, account type and licensing, and pick the one you will open.
Nadia has two fee pages bookmarked, two directory entries saved, and a slight headache. The app looks cheaper, but the bank brokerage puts the ETF in her own name, and she keeps switching between the two tabs and changing her mind. To decide, she puts both brokers on one cost sheet, works out the cost for the way she will actually invest, and writes her choice down in one sentence. The exercise takes about 25 minutes.
Use a spreadsheet or a sheet of paper with one column for each of your two shortlisted brokers. Add six rows: account type, commission, minimum fee, custody and other fees, funding method, and licence. Fill each row from the fee pages and directory entries you found in Lessons 1.2 and 1.3. If a fee page is vague, write "ask" in the cell and send the broker a message. Don't leave cells blank, because a blank cell is a cost you haven't found yet.
Nadia's sheet uses made-up fees for illustration, so use the real numbers from your own two brokers' fee pages. Broker A is her bank's brokerage. It's a CDP-linked account, charges 0.12% commission with a S$10 minimum and has no custody fee. She pays for it from her linked bank account, and it holds a capital markets services licence. Broker B is the app. It's a custodian account and charges a flat S$1.50 a trade. It has no custody fee but charges S$1 each time it collects a dividend. She pays for it from cash she deposits in the app first, and it also holds a capital markets services licence.
Exchange and clearing fees apply at both brokers. Nadia leaves them out because they don't change which broker is cheaper, and you can leave out any fee that is the same at both of yours.
Take your monthly example and work out what twelve orders cost at each broker. Then add any yearly charges, such as dividend fees. Write each total as an amount and as a percentage of the total you invest in the year.
Nadia uses the course's standard plan: S$500 of an ETF every month for a year, which is S$6,000 in total. At Broker A, 0.12% of S$500 is S$0.60. That is below the minimum, so each order costs S$10, and twelve orders cost S$120, which is 2% of S$6,000. At Broker B, twelve orders at S$1.50 come to S$18. The fund is expected to pay a dividend twice a year, which adds S$2 in dividend fees, for a total of S$20, about 0.33%. With monthly buying, Broker B is cheaper by S$100 a year.
If a minimum fee is pushing the cost up, add a line that costs fewer, larger orders, so the same minimum fee is spread over more money. Nadia tries buying every three months at Broker A, which means four orders of S$1,500 each. Each order still hits the S$10 minimum, so the year costs S$40, about 0.67%. That shrinks the gap between the brokers from S$100 to S$20.
Add one more row called "what I give up". The "what I give up" row holds each broker's drawbacks that the cost figures don't show, such as who owns the shares, how dividends reach you, voting, and how you get your shares back if the firm fails. Fill it in for both brokers, including the cheaper one.
Under Broker B, Nadia writes that her shares are held in the broker's name, dividends pass through the broker first, she can vote only on request, and it would take longer to get her shares back if the firm failed. Under Broker A, she writes that small orders cost more and the money has to be in her bank account by the payment date.
Be honest in this row about what you actually care about. If you don't care about voting and are happy with a custodian account, say so. Lesson 1.1 said either account type can be right. What matters is knowing which one you picked and what it cost you.
Look at the whole sheet, then choose one broker. Write one sentence explaining why, in words you would still accept if you read them again in two years. If the two brokers come out almost level, pick the one that is easier to fund from the bank account you already use. You are more likely to keep investing every month with a broker you can pay without any hassle.
Nadia picks Broker A and will buy every three months. Her reason is that paying S$20 a year more than the app is a fair price for holding her ETF in her own CDP account. Fee pages change, so she notes a date a year from now to check Broker A's fees again, and you should note one for your chosen broker too.
A finished sheet fits on one screen. It has two columns, the six rows filled with real figures, a yearly cost for your monthly example, a "what I give up" row, and one sentence naming your choice. Every number on it should trace back to a fee page or a written reply from the broker, so a friend checking it would reach the same totals.
You have everything you need from the last three lessons. Build the sheet for your own two brokers, work out the yearly cost of your monthly example for each one, and then write the sentence.
Build the comparison sheet, work out the yearly cost of your monthly example for each broker, and write down which broker you will open and why.
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