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With a market capitalisation of over US$40 trillion, the US stock market offers investors access to some of the largest and most innovative businesses, giving them the best opportunities to grow their wealth over the long term.
For Singapore investors, trading in the US stock market brings about greater diversification and more trading opportunities due to the higher volatility compared to the local stock market. However, higher volatility may also be viewed as carrying a higher risk. That’s where Phillip Securities’ POEMS’s US Asian Hours may help investors manage their portfolio risk by providing trading access to selected US stocks during Singapore market hours (i.e. from 9am to 5pm SGT).
#1 What Is US Asian Hours
A big obstacle for Singapore investors trading US stocks is dealing with the late hours in which the US stock market operates. In Singapore, this is from 9.30pm to 4am (SGT) from the second Sunday in March to the first Sunday in November, and 10.30pm to 5am for the rest of the time (to account for Non-Daylight savings).
During this period, investors may also participate in the US Pre-Market from 4pm to 9.30pm (SGT). This leaves a gap between 4am to 4pm (SGT) – more specifically during the bulk of the Singapore market hours – during which Singapore investors are unable to transact their US stocks.
Bridging this gap is the US Asian Hours, trading service provided by Phillip Securities’ trading platform POEMS. This newly introduced trading service allows its clients to trade US stocks during Asian hours (9am to 5pm SGT). With this service, investors have up to 20 active hours (during non-DST) of seamless US trading, from the US Asian Hours to the US Pre-Market to Regular Trading hours.
| US Asian Hours | US Pre-Market | US Regular Trading Hours | |
| Eastern Standard Timing (EST) | 9pm to 5am | 4am to 9.30am | 9.30am to 4pm |
| Singapore Timing (SGT) – Daylight Saving – Non-Daylight Saving |
9am to 5pm | 4pm to 9.30pm 5pm to 10.30pm |
9.30pm to 4am 10.30pm to 5am |
Read Also: Step By Step Guide To Opening A Brokerage Account With POEMS
#2 Why Trade US Stocks In Asian Hours
i. Act On News Event And Earnings Announcements During Asian Market Hours
News events that affect the stock market may happen at any time of the day, including outside regular trading hours. Similarly, companies may release their earnings announcements either during Pre-Market hours or after regular market hours. Having access to US Asian Hours gives you an edge, the nimbleness to react to such news events and have the first-mover advantage when acting on any market-moving events.
For instance, the S&P 500 futures fell by around 3% from 2pm SGT and carried over until the US Pre-Market hours (or 9pm SGT), as shown below, following the news of the bank run on Silicon Valley Bank (SVB) and uncertainty as to how it would affect the financial market. With the US Asian Hours trading service provided by Phillip Securities, investors who fear of a bigger selldown during regular US trading hours, may liquidate their positions ahead of other market participants.
ii. Gauge Market Sentiments
You can use the price movements feature on the POEMS trading platform during US Asian Hours as a means to gauge the market sentiments to help you prepare for the pre-market session.
iii. Profit From Arbitrage Opportunities
There are two ways to identify potential arbitrage opportunities during US Asian Hours.
One way is to look for opportunities during the overlap time periods between the US Asian Hours and the US Pre-Market Hours from 4pm to 5pm SGT. Assuming there is a price difference between the two markets, you can simultaneously buy and sell for an arbitrage trade.
The second way is to look for opportunities in dual-listed stocks like Alibaba. For example, if there’s a price difference between the Hong Kong listing and the NYSE listing, you can make a simultaneous buy and sell for an arbitrage trade. However, there are other considerations when utilising this strategy, such as the conversion ratio of the American Depository Receipts (ADR) and the foreign exchange fees.
Read Also: Buy The Dip Or Run For The Exit? What To Do When The Stock Market Crashes?
#3 Trade 55 US Stocks And 4 ETFs During US Asian Hours
Investors would be able to trade 55 popular US-listed stocks, such as Alibaba, Apple, and Tesla, as well as 4 ETFs, like the Invesco QQQ Trust, SPDR S&P 500 ETF Trust, and ProShares UltraPro QQQ (3X QQQ ETF). The full list of the tradable US Asian Market Hours counters can be found on the POEMS website.
#4 Minimum Trade Order Size Of US$10
When trading during US Asian Hours, the minimum trade size per order is US$10. This should not be an issue as all the stocks currently on offer trades above US$10 per share.
While you can place your order via POEMS 2.0 Web or POEMS Mobile 3 App like in the regular and pre-market sessions, for US Asian Hours, you can only place one order (either a Limit or Market order) at any one time for each counter.
#5 Phillip Securities Acts As The Principal For US Asian Hours Trades
Phillip Securities will act as the principal or market maker for all US Asian Hours trades. This is unlike during regular Trading and US Pre-Market hours, when it acts as the agency that facilitates transactions and liquidity is fulfilled by the stock exchange.
Quotes for the bid and ask, which are based on the security’s previous day’s closing, may vary between the different counters depending on the volume during the US Asian Hours. Nevertheless, the spread for widely traded counters like ProShares UltraPro QQQ and Tesla could be as low as 0.01 cents.
Source: POEMS (Screengrab as of 27 April 2023)
#6 Competitive Commission Rates
The standard commission rate for online trades using POEMS’ US Asian Hours trading service is 0.3% (minimum US$20) is applicable to all account types. However, from 19 July 2022 till 30 June 2023, you can trade at the promotional rate of just 0.08% (with no minimum trading fees). These trade orders must be settled in either SGD or USD within 2 days from the date of trading.
Additionally, do note you also need to pay the following regular trading fees for each trade on the US Market:
- Securities and Exchange Commission (SEC) Fee: 0.0008% (sell trades)
- Trading Activity Fee (TAF): Applicable only for sell trades at USD 0.000145 per share, subject to maximum of USD 7.27 (with effect from 3 January 2023)
- American Depository Receipt (ADR)/Depository Receipt (DR) fee: Varies for each counter
Separately, Cash Plus Account holders with less than $250,000 in asset value are charged an account maintenance fee (for Singapore stocks) of S$15 per quarter (based on the March, June, September, and December month-end balances). However, this fee will be waived provided you make at least one trade per quarter.
As for Cash Management Account holders holding foreign shares, they will incur Foreign Share Custody Charges of S$2 per counter per month (subject to a max of S$150 per quarter). A waiver of the fees will be granted provided you make at least two trades per month or six trades per quarter or accumulate a minimum of S$132 in brokerage fees per quarter.
Read Also: POEMS Cash Plus Account: Complete Guide To Understanding This Low Cost Trading Account
Trade US Asian Hours with POEMS
For Singapore investors, the US market presents an alternative to growing their investments or making opportunistic trades due to its higher volatility than the local stock market. However, the same volatility can be a double-edged sword for investors, as it could mean taking on a bigger risk.
As the first broker in Singapore to provide US Asian Hours service, Phillip Securities enables investors to react more quickly to market-moving news outside the regular trading hours and take advantage of arbitrage opportunities in dual-listed counters like Alibaba, Baidu, and Bilibili. This can help them mitigate their portfolio risks and seize new short-term opportunities before other market participants.
Simply open a POEMS trading account today and have access to over 20 different markets, including the US Asian Hours. Fear no more on how the US market will open and instead revel in the edge over others to react faster and make better trading decisions.
The post US Asian Hours: 6 Things Investors Need To Know About Buying US Stocks During Singapore Market Hours appeared first on DollarsAndSense.sg.
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