As the competition for retail investors heats up, Xiaomi-backed online trading platform Tiger Brokers (Singapore) has announced its boldest move yet: Zero commissions, permanently.
The digital brokerage announced on April 8 the launch of its inaugural “lifetime zero commissions campaign”, applicable to unlimited trades of US stocks.
The latest in a slew of fee-slashing moves among platforms could make trading in the world’s largest stock market even more attractive. “With commission-free trades, users can better capitalise on small price movements in the market and unlock cost savings with more efficient trading using the Tiger Brokers (Singapore) trading platform,” says the NASDAQ-listed firm.
“Investors new to trading can also benefit from access to US markets at a lower cost,” adds Tiger Brokers (Singapore).
New users will receive a welcome bundle that includes zero commissions for US stock trading for 180 days, one free Grab share and a $5 cash voucher upon first deposit. Those who join with at least a $2,000 deposit are also entered into a draw for one free share, with a Tesla stock as the most valuable prize.
To remove commissions on US trades, users must refer one new user who deposits at least $100 into their own account. The first 10 referrals will also earn the user one GoPro share each, and Tiger Brokers (Singapore) will reward the user with $10 vouchers for each successful referral, with no limit.
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While there is currently no deadline for the lifetime zero commissions campaign, the promotional welcome bundle will end on July 1, 2022.
According to the digital brokerage, trading volume has been surging among its users, especially for US securities. So strong is this appetite for US names that the annual growth rate stands at 250% over the past two years.
Based on data from its Tiger Trade platform, the average daily trading value of US securities amounts to some US$102 million per day. Some 87% of users on Tiger Brokers (Singapore) are invested in US securities, and CEO Eng Thiam Choon notes increased interest in US markets amid global volatility.
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High US inflation and the Russia-Ukraine crisis have not shaken investors’ belief in US equities. Instead, Eng notes a flight to large-cap names. “We have seen a surge in the sale of US equities on our Tiger Brokers (Singapore) platform in the month of March amid heightened market volatility. However, we also saw an increase in the purchase of quality US companies in the equities space. It seems that investors are moving their funds away from riskier companies to blue chip companies.”
Looking ahead, Eng continues to see strong investor interest for thematic sectors in the US with a strong secular outlook, such as electronic vehicles, technology and semiconductors.
Investor demand for equities should remain strong in the year ahead, says an optimistic Eng. “As global central banks reverse their loose monetary policies to combat rising inflationary risks, we anticipate that equities should continue to be preferred to bonds in the current inflationary environment, especially for companies that are expected to pass on higher costs to consumers and maintain both growth and margins in the current climate.”
Tiger Brokers (Singapore) is backed by US-based brokerage Interactive Brokers, Chinese tech giant Xiaomi and famed investor Jim Rogers.
Since its launch in February 2020, the young digital brokerage has been busy launching new products to grow its similarly fresh-faced user base. Generation Z investors, or those born between 1996 and 2010, account for 28% of Tiger Brokers (Singapore)’s customer base.
The online trading platform currently boasts over 1.8 million customers worldwide, with an annual trading volume of more than US$404.3 billion as at December 2021.
Apart from the New York Stock Exchange and NASDAQ, Tiger Trade lets users access four other global bourses; namely, the Singapore Exchange, the Stock Exchange of Hong Kong, the Shanghai/Shenzhen-Hong Kong Stock Connect and the Australian Securities Exchange.
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“While other brokerages may run similar promotions, we aim to provide value to our users in a sustainable manner,” says Eng. “We place strong focus on delivering the best user experience with our cutting-edge technology, which has proven to be the reason why our customers have stayed with us.”
Amid growing awareness of Environment, Social and Governance (ESG) considerations among investors, Tiger Brokers is committed to promoting sustainable development and accelerating green investments for the future. Users who prefer passive investing and value sustainability can also access sustainable funds on the platform, says Eng. “Retail investors can easily invest in over 60 sustainable funds that are on Tiger Brokers (Singapore). This includes widely traded funds, such as the United Smart Sustainable Singapore Bond Fund and the Fidelity Sustainable Asia Equity Fund.”
Eng’s team aims to increase this number “substantially” this year by working with partners of the World Wide Fund for Nature Singapore (WWF-Singapore).
The Tiger Trade mobile application is available for download on the Apple App Store and Google Play Store. Learn more about the lifetime zero commissions campaign here.
Photo: Albert Chua / The Edge Singapore
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