Wish to understand how stock trading works

Hi everyone,

Feel free to visit this page: http://www.howthemarketworks.com/

Introductory copied from the website:
This website was created to help you understand how stock trading works. Hopefully you will be able to begin trading for the first time or simply have a better understanding of what happens behind the scenes. Best of all, this site is completely free!

Personally I find NUS Economics students' primary education for stock exchange is very surfaced and limited. So, for those who want to venture the career of investment, perhaps some self-study is needed.

Okay, I just post some basic information of stock market for a beginner to know.

To set up a brokerage account in Singapore, you can sign up with one of the major stock broking house.:

Check out http://www.irasia.com/brokers/sg/index.htm for the available stock broking houses.

The requirement is one has to be at least 21 years of age to sign up.
It takes roughly 3 weeks to activate your brokerage account.
Setting up an account is free of charge.
Payment of contracts can simply be done through Electronic Payment System (EPS)


Alternatively, one can set up a contract for difference (CFD) account
www.cmcmarkets.com.sg
www.igmarkets.com.sg

Advantages of CFD account is they offer lower commission rates compared to the major stockbroking houses. You need not pay the full amount of shares that you purchase, only required to pay a sum of required deposit. CFD account allows you to do shortselling while major stock broking houses do not. They also allow you to do stop orders to minimize your losses.

However, the major stockbroking houses provides better financial services ie. they will send the latest financial news to your email account daily, they offer more informative charts for analysis. Their platform is less complicated compared to the CFD firms.

Personally, I will say the learning curve is steeper for someone who wants to set up a CFD account. You have to learn how to use limit and stop orders to your leverage. Lesser technical information is made available to you thus I will recommend a beginner to start with a major stockbroking house first.

Hope you find this information useful!