Looking to trade with your CPF Money?
Here's a simple guide on the things you need to do and know in order to get started trading with CPF Money at Lim & Tan.
*Note: this article does not address questions on all CPF Investments, it is only related to purchasing stocks w CPF Money at Lim & Tan.
1. How Much CPF Savings I Can Invest In Stocks and Gold
Up to 35% of your investible savings* (in the CPFIS-OA) can be invested in:
- Shares
- Property Funds (or Real Estate Investment Trusts REITs)
Up to 10% of your investible savings* (in the CPFIS-OA) can be invested in:
- Gold ETFs
Only monies in excess of $20,000 in your Ordinary Account can be invested.
The computation for investible savings by CPF Board can be complicated as it takes into consideration several factors, eg. amount withdrawn for other investments/education, shortfalls in Retirement/Medisave etc.
Hence, before investing with your CPF funds, it is recommended that you check your investible savings amount via CPF online service using your SingPass: www.cpf.gov.sg. Scroll down to the bottom and you will be able the see the amount available for both Stocks and Gold.
Also, here's the website for calculating your stock and gold limits on CPF website:
https://www.cpf.gov.sg/eSvc/Web/Schemes/StockAndGoldLimits/StockAndGoldLimitsLanding
Do take note that the total amount bought including fees must strictly be within the investible savings amount. If there are any revocation of trades due to insufficient funds, there will be consequences which will be troublesome and can incur losses.
Additional info on CPF Investment Schemes:
https://www.cpf.gov.sg/Members/Schemes/schemes/optimising-my-cpf/cpf-investment-schemes
2. CPF Investment Account
You will first need to have a CPF Investment Account, which you can open at any of the local banks: DBS/OCBC/UOB. Do check their websites to see if it can be opened online.
Once you have the CPF Investment Account, please furnish Lyndell with the account number and bank name for linkage, at least one day before you do your trade.
After the purchase of your stock, it will be held in your CPF Investment Account (not CDP Account). It will be managed by the bank and you will be able to check the stock portfolio via bank statements or online banking platform.
Placing a CPF order is very similar to placing a normal order. The only difference is that you have to select your payment type or mode as "CPF".
Online Trading Platform
Mobile Apps
4. Forgot to select "CPF"
What if I had forgotten to select payment type/mode as "CPF"?
You can contact Lyndell to make an amendment within the Trade Date. All amendments are to be done on the Trade Date.
Hence, please be mindful to select "CPF" when selling, this is a common mistake. Failing to do so ends up as a short-sell that is subjected to CDP buy-in or possible penalties.
5. After CPF payment, where are the shares held?
When you place order, you can select which payment type: Cash, CPF or SRS.
Having selected CPF, payment will be made from funds from your CPF Investment Account. Subsequently, the shares will be held in your CPF Investment Account, ie. held with the bank that has your CPF Investment Account.
Hence:
- Payment by Cash - Shares held in CDP
- Payment by CPF - Shares held in CPF Investment Account
- Payment by SRS - Shares held in SRS Account
6. Stocks under CPF Investment Scheme
CPF details a list of stocks that can be traded, the selection is based on some criteria.
This list of stocks can be found on the SGX website: Stocks under CPF Investment Scheme
On the online trading platform and mobile apps, the stocks will have a "C" in the "Ind" column.
Online Trading Platform
Mobile Apps
7. Fees
The fees & charges for trading with CPF money is the same as a cash trade:
For each trade, there is brokerage payable based on the contract size.
- Place your trades online (via online platform/iPad/iPhone/Andriod app) and you will also be able to collect reward points for every buy and sell contract.
- If you place an advisory trade (ie. Lyndell places the order for you), then the rate will be the same as above but without the reward points.
- Besides the brokerage payable, there is CDP Clearing Fee, SGX Trading Fee and GST payable.
Eg. a buy order and a sell order for CapitaLand (Up to $50k):
 |
| Net Total may differ by a few cents from actual |
8. Bank Charges
Additionally, the agent bank that holds the stock has recurring charges, typically it costs: $2 per counter per quarter, with minimum charge of up to $5 (for shares, REITs, corporate bonds, ETFs including gold ETFs and statutory board bonds;
$2 per counter per quarter (for Singapore Government Bonds and Treasury Bills)
To get the exact charges, please refer to the bank's website and search for its Schedule of Charges.
9. Contra Trading Not Allowed
Stocks bought with CPF money has to be picked up (ie. paid fully), contra trading is not allowed.
To be safe, the earliest you can sell after buying is 3 market days later.
Selling within the day or one day after purchase can lead to short-selling and possible penalties.
10. Dividends & Profit/Loss
Dividends are paid to your CPF Investment Account.
As with profit/loss: Purchases are fully paid. After selling, the sales proceeds will be paid back to your CPF Investment Account. The difference is the profit/loss. Profits made cannot be withdrawn.
11. Rights Issues & Other Corporate Actions
As the stocks are held in the CPF Investment Account, the bank will handle all your corporate actions such as right issues, bonus issues and scheme of arrangements.
Have a question? Contact Lyndell via email/SMS/WhatsApp.
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