Brokerages eye customer boost on TD Ameritrade retail fallout
Yong Hui Ting
BROKERAGES in Singapore are bracing for an influx of new customers, after trading platform TD Ameritrade (TDA) announced this week that it would stop serving retail investors from December.
Several brokerages that spoke to The Business Times said they have seen an uptick in the number of enquiries to transfer assets and open new accounts since Tuesday (Sep 26).
Ian Leong, chief executive officer of Tiger Brokers (Singapore), said the company has received a “substantive number of calls” from TDA account holders enquiring about crossing over to the Tiger Trade platform.
Investment platform Syfe said it is forecasting to pick up to “a few thousand new accounts” in the next few weeks. This is based on the “general uptick” in account openings and requests to transfer securities since the TDA announcement.
Syfe, however, was not able to confirm if the new customers are former TDA clients.
In anticipation of the influx of new customers, some brokerages have set up dedicated sites answering frequently asked questions by potential customers leaving TDA. These include a how-to guide on transferring cash and equities, fees, as well as the types of securities and products that are accepted – or not.
Some brokerages, for example, do not accept transfers of micro-cap stocks or penny stocks as they are called.
Some, such as Syfe, Saxo and CMC Invest, said customers would be able to transfer stocks and trade them, as long as they fall under the list of products offered by each platform respectively.
“The only restrictions are non-standard or illiquid securities that may not be eligible for Automated Customer Account Transfer Service transfers,” said a Syfe spokesperson.
TDA’s announcement on Tuesday to halt services for retail customers came as a surprise. The company said the move will allow it to “better serve the unique needs of local investors”, and concentrate on a market that has been “under-served historically in Singapore”.
It declined to reveal the number of retail investors who would be affected by the stoppage of service.
