You will be able to open a CDP account and a CDP-linked brokerage account online and know what each application asks for.
Nadia set aside a Saturday morning to open her accounts. She expected it to take an hour. It took fifteen minutes of typing, then nine days of waiting, and the waiting was the part nobody had warned her about.
This lesson walks through what the two applications ask for, why there are two of them, and what to expect between pressing submit and placing your first trade. The details change, so treat what follows as a map and check the current steps on the SGX website and your broker's site before you start.
If you chose a CDP-linked broker in lesson 1.4, Compare two brokers on one sheet, you need two accounts that work together.
The CDP account is where your shares are recorded in your name. It's run by the Central Depository, which belongs to SGX. You open it once in your life, and it stays with you. You can link it to more than one broker, so if you switch brokers later, or use two at once, your holdings stay in the same CDP account.
The brokerage account is where you place orders and pay for them. When you buy through a CDP-linked broker, the trade settles into your CDP account. The broker records that you bought, and CDP records that you own.
Neither account works for buying shares without the other. A CDP account alone can't place orders. A brokerage account that isn't linked to your CDP account can't settle a CDP-linked trade.
If you chose a custodian broker instead, you only need the brokerage account, because the broker holds the shares for you. Most of this lesson still applies to that one application.
Most brokers and CDP let you apply online, and many let you fill in the form with Singpass Myinfo. Myinfo pulls your name, NRIC or FIN, address, date of birth and other details from government records with your consent. That saves typing, and it usually means you don't have to upload a copy of your NRIC or a proof of address.
Some brokers open the CDP account for you as part of their own form. Others ask you to open it first on the SGX website, then enter the CDP account number in the broker application. Check which way your broker works before you begin, so you don't apply for a CDP account twice.
Expect questions beyond your identity. Brokers are required to know who their customers are, so they ask about your job, your income range, the source of the money you'll invest, and your tax residency. They may also ask about your investing knowledge and experience. Answer honestly. Some products, such as leveraged or inverse ETFs, need a separate assessment before a broker will let you trade them, and a plain index ETF bought on SGX normally doesn't.
You'll usually be asked to choose an account type. Pick a cash account, where you pay in full for what you buy. Avoid any account that lets you borrow to buy, often called a margin account, until you know exactly how it works. You'll also be asked to agree to the terms and conditions and a fee schedule. Save a copy of both.
After you submit, both applications go through checks. Approval can take a few working days, sometimes more if anything needs a second look or your Myinfo details don't match what you typed. Nadia's CDP account came through in four working days and her broker account in nine, because the broker waited for the CDP account to exist before linking it.
You can't trade until both accounts are active and the broker has linked them. Look out for two things: an email or letter from CDP with your CDP account number, and a message from the broker saying the account is ready, often with login details or an invitation to set up the app.
If a week passes with no word, check the broker's application status page or contact it. Applications sometimes stall on a small mismatch, like a different spelling of your address, and nobody tells you unless you ask.
Start a note now, before you submit anything. Write the date of each application, any reference number you're given, and which email address you used. It sounds fussy. When you're chasing an application a week later, it saves you from guessing.
Don't put passwords, Singpass details or one-time codes in the note. Those stay in your password manager or your head. The note is for dates, reference numbers and account numbers, which lesson 3.3 builds into a fuller record.
Before you submit, go to your chosen broker's website and the SGX website and write out the steps each one asks for, in order, with any documents they need. Then you'll know exactly what you're signing up to, and you'll have the start of your record.
Write the list of steps and documents your chosen broker and CDP ask for, and note the date you submit each application.
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