If you are focusing predominantly on US market, obviously you want to focus on brokers that have a long history of providing trading assets to the US market. Interactive Broker is definitely one of them, and Interactive Broker is definitely very established regardless whether it’s the brand name, the software itself, the entire platform, the reputation. It has been a very, very long time.

The only downside to using Interactive Broker, considering that we are based in Singapore, is that if I remember correctly, Interactive Broker doesn’t have an office in Singapore. They are not regulated in Singapore itself. They used to be, but they actually pull out of Singapore. For one reason or another, maybe because they feel Singapore is too small a market for them to dedicate the resources to Singapore.

So, which means that if you want to use Interactive Broker, you will probably have to wire your money to their foreign bank account that is not based in Singapore and not regulated in Singapore. Of course, many people will say, “What’s the chances of Interactive Broker going bankrupt or disappearing with your money?” This is part of the risk any trader will have to learn to deal with. The risk that we are working with is not just the risk of our trades itself.

Sometimes, it’s also the risk of the broker that we use. Just like nobody expects MF Global to go down as well, but they did. Okay. So this is a risk you have to ask yourself, are you willing to live with the risk of putting your money in some certain broker that doesn’t have an office in Singapore? It’s very reputable worldwide, but it doesn’t have an office in Singapore, doesn’t have a bank account in Singapore in fact, and you need to wire your money out and stuff like that. And if you want to take your money back, how quickly and how easy it is to get it back? So again, there is no best, no right or wrong. There’s only pros and cons.

 

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Philip Teo

Founder & CEO at Traderwave Pte Ltd
Philip Teo is an entrepreneur, speaker and trading coach who specialises in the field of Technical Analysis of the financial markets. He is currently the Founder and CEO of Traderwave Pte Ltd, a financial technology company that offers a web charting application to global traders. He has conducted many trading seminars and appeared on national television before. He is also currently an official speaker and trainer with SGX Academy. Learn more about him at his Google+ Profile, LinkedIn Profile and Facebook Profile

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