Before we start, think of the word "Trust". What does it mean to you?
Yes, that essentially explains it all.
A trust account is a money account held on trust by Lim & Tan for and on behalf of you.
Here are some examples where you will use your trust account:
- To deposit funds to earn interest
- To deposit funds before buying shares
- To hold your funds before your buy contract is due (if you made early transfer before due date)
- To hold any excess amounts that you have transferred for your buy contract (for eg. your contract was $5,999 and you transferred $6,000. The balance $1 will go to your trust account.)
- To hold your sales proceeds after selling your shares (instruction have to be given)
- To use the funds to pay for other buy contracts / fees (instruction have to be given)
Every trading account that you have with Lim & Tan has a trust account, there is no need to open one, ie. if you have a cash trading account and a cash collateralised trading account (CCT), each will have its own trust account.
If you wish for all future purchases and sales to be settled through your trust account, you can give a standing instruction. Ask Lyndell for more details.
IS THE TRUST ACCOUNT REGULATED?
Yes, of course. There are strict rules to comply with as prescribed under the Securities and Futures Act. The rules stipulate how the monies that belong to clients is held and handled.
WHERE CAN I VIEW MY TRUST ACCOUNT BALANCE?
DAILY TRUST MOVEMENT LEDGER
You can see the daily movement of your monies through the Daily Trust Movement Ledger:
The ledger can also display the type of account, available period and currency:
The ledger can also display the type of account, available period and currency:
WHAT IS THE INTEREST RATE FOR THE TRUST ACCOUNT?
The interest rate is subject to change from time to time. Different currencies have different interest rates. The current published SGD interest rate is 0.65% p.a (wef. 01 June 2020).
To find out the current rates, check Lim & Tan Website FAQ section on SGX FAQ or ask Lyndell.
Interest (if any) will be computed and credited to your trust account on a daily basis.
HOW TO TRANSFER FUNDS INTO MY TRUST ACCOUNT?
The methods are the same as payments, as though you are making payment for your contract. If there aren't any outstanding contracts/fees, the funds will automatically be deposited into your trust account.
Funds transfer via the following methods:
- Electronic Payment for Shares (EPS)(best choice!)
- Internet Banking (Bill Payment)
- Bank Transfer (ask Lyndell for Bank Account Number)
- PayNow
- Cheque
If you have a GIRO arrangement, then you will have to use one of the methods above (except EPS).
HOW TO WITHDRAW FUNDS FROM MY TRUST ACCOUNT?
Withdrawal can be done by submitting a form on the online trading platform. Unfortunately, this function is not yet available on the Mobile Apps.
HOW TO SET INSTRUCTION FOR ALL DEBITS AND CREDITS TO BE AUTOMATICALLY OPERATED FROM TRUST ACCOUNT?
We call this a "Trust Account Standing Instruction". It can be arranged for SGD and/or Foreign Currencies (ie. all foreign currencies). Please ask Lyndell for the form.
If you have a trust account standing instruction in place, it means that if you have a purchase, the total amount will be automatically deducted from the trust account on due date. Likewise, if you have a sale, the total amount will be automatically credited to the trust account on due date. Likewise, also for contra profits/losses.
Common Scenarios:
- This is a good arrangement if you want to set aside a batch of funds solely for trading or investing. Holding it in the trust account can help you to stay focused and track your gains or losses easier.
- This is also a common arrangement especially for foreign currencies such as USD and HKD. Having a foreign currencies trust account standing instruction will save you from foreign currency exchange loss, by keeping your sales proceeds in that foreign currency, and using it again when you purchase other shares in the same currency.
- When you are done with your investments or say, happy with your profits, you can withdraw funds by submitting a Trust Account Withdrawal form on the online platform.
You may want to read:
- Setting Up Your Watchlist With High Dollar Volume Stocks
- A Beginner's Guide To Trading US Market on Lim & Tan
- See all SG Market articles
- See all Tutorials
