TRADING IN US STOCKS FAQ	Related Links
		Product
		FAQ

Trading in US Stocks - What you should know?

• Q1: Who is eligible for the US Stock Trading?
• Q2: How do I open a US Stock Trading account?
• Q3: What is W-8BEN form?
• Q4: What is the NYSE/AMEX/NASDAQ Market Data Agreement?
• Q5: What is the US Market Brokerage Rates?

Account Related

• Q1: Are there any processing fees required to open the account?
• Q2: Can I use my limtan Login ID and password to access and trade in the US Stock Market?
• Q3: Can I make changes to any of the Login ID and Password?
• Q4: What should I do if I have forgotten my Login ID and/or Password?

Trading Related

• Q1: How do I place an order in the US Stock Market?
• Q2: What are the Trading hours for the US Stock Market?
• Q3: Is the price data live?
• Q4: Can I trade Odd Lot in the US Market?
• Q5: What is the Order Types available?
• Q6: What is the validity period of my order(s)?
• Q7: How do I know my order has been filled?
• Q8: What is the minimum bid size for US Stock Market?
• Q9: Will I be able to amalgamate my US trades?
• Q10: What are the US Stock Exchange Practices?
• Q11: Why is my cancelled trade(s) shown as filled in the Order Book?
• Q12: Why do I receive a different price from my confirmed execution after trade date?
• Q13: What causes the price to be different?

Trading Settlement Related

• Q1: What is the Settlement Date for the US Stock Market?
• Q2: Is short selling allowed?
• Q3: How will I know how much is the settlement amount?
• Q4: What is the settlement currency for my purchases and sales?
• Q5: What if I want to change the settlement currency?
• Q6: What will be the exchange rate used?
• Q7: How do I make payment for my purchases?
• Q8: When I sell, how do I receive my sales proceed?
• Q9: Can I use my CPF/SRS fund to settle the transaction?
• Q10: What will happen to my shares after I have made payment for it?
• Q11: Are there any charges for keeping my shares in the safe custody of LTS?
• Q12: How will I be billed for custody charges if I hold foreign shares in two separate accounts?
• Q13: Can I consolidate all my foreign shares into one account?
• Q14: How do I make payment for the custody charges?
• Q15: Can I transfer the US shares in from other Broker(s) to my Online Trading account at Lim & Tan? Will there be any charges for shares transferred into LTS?
• Q16: Will there be any charges for shares transferred out from LTS?
• Q17: Can I contra my purchases?
• Q18: What will happen if I do not pay on time?
• Q19: Are there any Dividend Handling Fee for dividend received?
• Q20: How much is the Corporate Action charges?
• Q21: What is ADR and is there any charges for ADR?
  

Trading in US Stocks - What you should know?

Q1 Who is eligible for the US stock trading?

Anyone who is above 21 years old and with no record of delinquency can open a limtan.com.sg Online Trading account. This account will allow you gain direct access to US Stock Trading, subject to listed SIP qualifications and further permissioning and / or documentation. Please contact your Trading Representatives or Online Trading Helpdesk for more information on SIP qualifications.

US citizens or US residents are not allowed to trade in US securities.

Q2 How do I open a US Stock Trading account?

a) You need to have a limtan.com.sg Online Trading account before you can trade in the US Stock Market. If you do not have an Online Trading account, please visit Lim & Tan Securities or come by our various roadshow location islandwide. You may also call our Online Trading Helpdesk (Tel: +65 6799 8188) to obtain a set of forms. The forms can also be downloaded here.

b) Duly complete the U.S. Markets Account Opening Form , W8-Ben Form and Risk Disclosure Form and submit it to Lim & Tan Securities or our authorised Trading Representatives. The forms can be downloaded here.

c) Read the NYSE/AMEX/NASDAQ Market Data Agreement as required by NYSE/AMEX/NASDAQ and check to accept at the pop-up window on our Online Trading platform upon your first access to the U.S. market.

Please seek your own independent professional advice for filling out the W-8BEN form and the acceptance of the NYSE/AMEX/NASDAQ Market Data Agreement where necessary.

Q3: What is the W-8BEN form?

Non-U.S. persons are subject to U.S. tax (max 30%) on certain types of income received from U.S. sources, such as interest and dividends.

It is the requirement of the U.S. Internal Revenue Service (“IRS”) that non-U.S. persons are required to complete and submit a duly completed W-8BEN Form for the following reasons:

• to establish that you are not a U.S. person; and
• to claim that you are the beneficiary of the US-sourced income for which the W-8BEN Form is provided; and
• to claim, if applicable, a reduced rate of, or exemption from, withholding tax by being a resident of a foreign country with which the United States has an income tax treaty.

W-8BEN form

If you would like to know more about the instructions for Form W-8BEN and tax treaties, please visit the following IRS websites or consult your tax adviser:

Instructions for Form W-8BEN:
http://www.irs.gov/pub/irs-pdf/iw8ben.pdf

Tax Treaties Information:
http://www.irs.gov/businesses/international/article/0,,id=96739,00.html

Q4: What is the NYSE/AMEX/NASDAQ Market Data Agreement?

The NYSE/AMEX/NASDAQMarket Data Agreement, also known as the ‘Subscribers’ Agreement’ upon your first login, relates to provision of market data by the New York Stock Exchange (NYSE)/AMEX/NASDAQ. As required by NYSE/AMEX/NASDAQ, every Lim & Tan Securities client who wants to trade in the US Stock Market must read and check on this agreement to confirm that he/she is a "non-professional" market data subscriber before obtaining access to the NYSE/AMEX/NASDAQ market data.

NYSE/AMEX Subscriber Agreement
NASDAQ Subscriber Agreement

Q5:	What is the US Market Brokerage Rates?

US Market Brokerage Rates

Commission	0.3% per trade
Minimum Commission	US$20 (w.e.f 11 July 2011)
GST	Brokerage x prevailing GST % rate
Sales Tax (for SELL order only)	0.00224% x Total Value (Total Value = Price x Quantity)
US Trading Activity Fee (for SELL order only)	USD 0.095 per 1,000 shares

Account Related

Q1 Are there any processing fees required to open the account?

There is no processing fee for opening an Online Trading account.

Q2:	Can I use my limtan Login ID and password to access and trade in the US Stock Market?

Yes. You can use the same login to your limtan.com.sg Online trading account if you are already approved to trade the US market. To find out how you can trade US market, please refer to here.

Q3:	Can I make changes to any of the Login ID and Password?

Yes. You are recommended to change the Login Password the first time you login.

Q4:	What should I do if I have forgotten my Login ID and/or Password?

If you have forgotten your Login ID and/or Password, please click here to reset.

Password Reactivation - Please select this option if you are able to remember your existing password but have exceeded the number of times allowed to enter your password. Our Customer Service Officer will contact you once your password has been reactivated.

Password Reissue - Please select this option if you are unable to remember your password. Your old password will be permanently disabled and the new password will be mailed to your mailing address in our records.

Trading Related

Q1:	How do I place an order in the US Stock Market?

You may login to our Online Trading platform, click under ‘Market’ to access a drop down list to select the US Stock Market you would like to trade in. We can trade on NYSE (NYSE Equities market), AMEX (NYSE Amex equities market) and NASDAQ.

For your own convenience, you may wish to search for your desired US counter, do a right click to add to your ‘Watchlist’.

Q2:	What are the Trading hours for the US Stock market?

US Stock Market: NYSE, AMEX and NASDAQ   Summer Daylight Saving* (Singapore Time) Winter** (Singapore Time) AMEX/NASD/NYSE Trading Hours 9:30pm - 4.00am (Summer) 10.30pm - 5.00am (Winter) Orders Accepted for next Trading Day 4.15am onwards (Summer) 5.15 am onwards (Winter) Orders Routed for Trading From 9.00pm From 10.00pm

* Daylight Savings effective from 2nd Sunday of March to 1st Sunday of November
** Effective from the 1st Sunday of November to the 2nd Sunday of March.

 

We do not participate in the US pre-open and pre-close trading sessions.

Note:
When a holiday falls on a Saturday the NYSE, AMEX and NASDAQ will not operate on the preceding Friday.
When a holiday falls on a Sunday the NYSE, AMEX and NASDAQ will not operate on the succeeding Monday.

Q3:	Is the price data live?

Quotes are delayed as follows:

NYSE: At least 20 minutes delayed quote
AMEX: At least 20 minutes delayed quote
NASDAQ: At least 15 minutes delayed quote

All Online Trading clients will automatically be entitled to one (1) month of free access to U.S. live prices upon the completion of at least one (1) U.S. Online contract*. (*Online contract(s) refers to trade done using Cash Account.)

Subsequent U.S. Online contracts will entitle clients to additional free access to U.S. live prices based on the last Online contract date. E.g. If a U.S. Online contract is done on 01 May, client’s Online trading account will automatically gain access to U.S. live prices until 01 June. Subsequently, if another U.S. Online contract is done on 02 May, client’s access to free U.S. live prices will be extended to 02 June.

You may also subscribe to Live quotes of NYSE, AMEX and NASDAQ for a fee. Redemption for live prices is available via our loyalty rewards redemption catalog using loyalty points or payment by cash.

Q4:	Can I trade Odd Lot in the US Market?

Yes. Odd lot trading is allowed and the minimum quantity to be submitted is at least one share. 

Q5:	What are the Order Types available?

Currently, all orders are Limit Orders. It means that you are buying or selling the desired US stock(s) at a specific price or better than it within the trading day.

Q6:	What is the validity period of my order(s)?

The validity of your order(s) is for one trading day. Order(s) will expire automatically at the end of each trading day.

Q7:	How do I know my order has been filled?

All partially/fully filled orders will automatically be updated under the status of your ‘Order Book’. At all times, please attempt to check the actual quantity filled under ‘Order Book’ – status.

Q8:	What is the minimum bid size for US Stock Market?

There is no minimum bid size for US Stock Market.

Q9:	Will I be able to amalgamate my US trades?

There is no amalgamation of orders for US trades. Each fulfilled order will be treated as an individual contract and brokerage will be charged accordingly for each of the contracts. For example, two buy orders of counter X fulfilled on the same day will be treated as two separate contracts for brokerage calculation. The same applies for sell orders as well.

Q10:	What are the US Stock Exchange Practices?

Standard trading and brokerage business practice within the U.S market.

• Auction Market: The New York Stock Exchange (NYSE) operates as an auction where trading takes place by verbal outcry of bids and offers by Exchange members acting as agents for institutions or individual investors. Buy and sell orders meet directly on the trading floor, and prices are determined by the interplay of supply and demand. This process is managed by Specialists, intermediaries that are mandated to match buyers and sellers and maintain a "fair and orderly market." Orders may also be placed through SuperDOT (Super Designated Order Turnaround System), a system that automatically transmits member firms’ market and day limit orders, up to specified sizes in virtually all listed stocks, through the Common Message Switch (CMS) to the proper trading floor workstation. Specialists receiving orders through SuperDOT execute them in the trading crowd at their posts, as quickly as market interest and activity permit, and return reports to the originating firm's offices via the same electronic circuit that brought them to the floor.
  
  Please be aware that NYSE Rule 123B for SuperDOT allows Specialists and brokers to change a price up to 12 noon (Eastern Standard Time) on Trade Date + 1. Price adjustments may occur when the Specialist discovers, upon reviewing the previous day’s transactions, that clients were given a wrong price. This practice, where investors will be given and must accept the corrected price, may be different from other marketplaces.


• Dealer Market: In contrast, NASDAQ (National Association of Securities Dealers Automated Quotation) is an Over-The-Counter (OTC) market where the price is determined by a market maker, a dealer who buys and sells out of inventory. In the OTC market, the market maker may not support the entire position because they are not required to maintain a "fair and orderly market." NASDAQ is a global intranet providing brokers and dealers with price quotations on securities that are traded over-the-counter; orders are paired and executed on a computer network or "electronic trading floor".

Q11:	Why is my cancelled trade(s) shown as filled in the Order Book?

Trades may not be cancelled successfully because the electronic order delivery system will execute trades immediately, taking priority over order cancellations. Please note that if your order has been executed but the electronic confirmation did not reach you immediately, the trade is still considered valid. Thus your cancellation request can be confirmed as Cancelled or Filled.

Q12:	Why do I receive a different price from my confirmed execution after trade date?

NYSE Rule 123B for SuperDot system provides automated order routing and reporting services to facilitate the timely and efficient transmission, execution, and reporting of market and limit orders on the exchange. SuperDot allows Specialists and brokers to change a price up toTrade Date + 1. Price adjustments may occur when the Specialist discovers that a wrong price was given to the brokers after reviewing the previous day’s transactions. Due to this practice investors will be given a corrected price and must accept the corrected price, which may be different from other marketplaces.

Q13:	What causes the price to be different?

Price differences may occur because of price adjustment made by the US counterpart after Trade Date and we are unable to adjust it manually at our Online Trading platform. It could also be due to a trade entry/Data entry error, which may have occurred at the US countpart where discrepancies can be detected up to T+1. Additionally, your order may be filled at various different prices and you may have only received or viewed the price of the last partially done trade via limtan.com.sg and hence your contract is generated with the average price.

Trading Settlement Related

Q1:	What is the Settlement Date for the US Stock Market?

Shares purchase will be due for delivery on Transaction date + 3 market days (T+3). All purchases must be settled by due date.

"T" denotes the Transaction Date. For e.g. If you purchase US shares on Monday (T day), the due date for your contract is on Thursday (T + 3). However, if the due date coincides with a Singapore public holiday, the due date is the subsequent market day.

Q2:	Is short selling allowed?

Short selling is not allowed

Q3:	How will I know how much is the settlement amount?

You will receive a Contract Note from LTS. You will also be able to find the information displayed at “Account Management” under “Outstanding Position”.

Q4:	What is the settlement currency for my purchases and sales?

The settlement currency has to be selected during order placement. The settlement currency for both purchases and sales will be settled in S$ or US$ only.

Q5:	What if I want to change the settlement currency?

You are able to change the settlement currency by calling the Online Trading Helpdesk at +65 6799 8188 or your Trading Representative on the same day or up to T+2 by 10am.

Q6:	What will be the exchange rate used?

The exchange rate will be based on LTS’s board rate on Transaction Date. You may check by clicking on “Board Rate” as shown on the screen below:

Q7:	How do I make payment for my purchases?

Cash, Singapore dollars or US dollars cheque for payment must reach LTS before 5pm (Singapore Time) latest by T+3.

For S$ settlement: GIRO/ EPS /Cheque /Cashier's Order.
Cash payment can only be made at our Cashier Counter
Opening hours: 8:30am to 5:45pm (Monday to Friday, excluding Public Holidays)

For US$ settlement: Cashier's Order or Personal cheque drawn on any Singapore bank.

Q8:	When I sell, how do I receive my sales proceed?

If your sales proceed is in S$, we will credit your bank account if you have opt for the GIRO/ EPS facility. Otherwise a cheque payment will be made in your name.

If your sales proceed is in US $, a cheque payment will be made in your name.

Q9:	Can I use my CPF/SRS fund to settle the transaction?

No. CPF/SRS fund cannot be used to settle the foreign transaction.

Q10:	What will happen to my shares after I have made payment for it?

The shares will be kept in our foreign custody by next working day after payment.

Q11:	Are there any charges for keeping my shares in the safe custody of LTS?

Yes. Monthly foreign custody fee is S$2 per counter, subject to a maximum of S$150 per quarter + GST.

For clients who conduct at least 6 trades in a quarter, the monthly fee of S$2.00 per counter will be waived in any month of that quarter. For clients who conduct at least 2 trades in a month, the monthly fee of S$2.00 per counter will be waived in that month.

Q12:	How will I be billed for custody charges if I hold foreign shares in two separate accounts?

The custody charges will be levied on a per account basis. If you hold foreign shares in two separate accounts, you will be billed according to the shareholdings in each account.

Q13:	Can I consolidate all my foreign shares into one account?

Yes. Account holders may submit written instruction to our Operations department – Custody/Corporate Actions.

Q14:	How do I make payment for the custody charges?

You may pay by any of the following payment methods:

• Cash
• Cheque
• Electronic Payment of Shares (EPS)

Q15:	Can I transfer the US shares in from other Broker(s) to my Online Trading account at Lim & Tan? Will there be any charges for shares transferred into LTS?

Yes, transfer request is allowed. For transfer details, you may contact our Operations Dept-Settlement at 64370145/105.

There are no charges for shares transferred into LTS. However, there are transfer fees imposed by the delivering securities firm.

Q16:	Will there be any charges for shares transferred out from LTS?

Yes, there will be charges depending on the type of transfers i.e. ACAT/DTC/DWAC. Each of these transfers has different fees charged ranging from US$25 to US $75 (excluding LTS handling charges, GST and courier fees). For more details, you may contact Operations department – settlement at 64370145/105.

Q17:	Can I contra my purchases?

Yes, contra is allowed for the US Stock Market. However, do note that the shares not bought through our Online Trading system must be custodised with Lim & Tan’s depository agent before you can sell.

Q18:	What will happen if I do not pay on time?

Unpaid shares after the due date will be force sold at the Company’s discretion.

Q19:	Are there any Dividend Handling Fee for dividend received?

Yes. Dividend Handling Fee will be charged. 

Dividend Amount	Dividend Charges
Below S$10	S$3.00+GST
S$10 to S$500	S$5.00+GST
Above S$500	1% subject to max. of S$100+GST

Note: Dividends are subjected to a withholding tax of 30%.

Q20:	How much is the Corporate Action charges?

Service charge on cash offer/ expiry of warrants/ rights application is S$10 per counter + GST.

Q21:	What is ADR and is there any charges for ADR?

An American Depositary Receipt (ADR) is a stock that trades in the United States and it represents a specified number of shares in a foreign corporation. ADRs were introduced as a result of the complexities involved in buying shares in foreign countries and the difficulties associated with trading at different prices and currency values. For this reason, ADR agents (banks and investment banks) purchase stocks on foreign exchanges and reissues them on either the NYSE, AMEX or the NASDAQ.

ADR agents charge ADR fees to compensate for holding and managing the foreign stocks. ADR fees vary for each counter and you will be billed according to the shareholdings for each ADR shares.