I attended the Tiger Brokers 10th Year Anniversary event last week by invitation and was impressed by how much they’ve grown since they started their inception tapping into the Singapore market just barely a couple of years back.
During the event, the CEO, Ian Leong, showcased some of the product offerings they have successfully launched in the past. This includes the likes of Fund Mall, Boss Debit Card, and so on. One of the latest product they have recently launched is the Cash Boost Account, and this article will review and help you to summarize what is it about.
What is Cash Boost Account?
The Cash Boost account is a trading limit account created for users in Singapore.
It is essentially a Contra account (if you’ve been using the traditional brokerage in the past, you would understand what I meant by that) where stocks purchased on T+0 day can be sold anytime before or on the Force Selling date itself. If you make a gain, you will be credited a profit on your account. If you decide to cut loss, then you simply have to top up on the loss into your Cash Boost Account.
If you wish or have the intention to keep the stocks for longer term however, I would recommend that you use your PRIME main account instead of this account as the Cash Boost Account is primarily meant for short term contra trading.
Why Do I Need The Cash Boost Account When I Already Have My Main Account?
The answer to this is Flexibility – to have the options as and when you need the funds to tap onto the opportunities and have an interest free charge until the 7th trading day (for the US market) and 8th trading day for the SG and HK market.
Short-term opportunities are abound every day at every minutes and these are some of the considerations angle you can take:
- Identify The Trend – using indicators such as moving averages, trend lines, Relative Strength Index (RSI) to confirm the trend.
- Look for overbought or oversold signals – using indicators such as RSI or Bollinger Bands to show if a particular stock is over-extended in the buy or sell territory.
- Entry Signal Point – Bullish of bearish candlestick pattern such as Doji or Engulfing pattern, that signals a potential reversal turning point.
It is important to note however that there are no free lunches in this world.
Contra trading can be as risky as it gets if it is done wilfully without using appropriate tools such as a stop-loss order. Volatile market conditions or a black swan event might also affect your contra trades.
How Do You Open The Cash Boost Account?
Opening the Cash Boost Account is relatively straightforward and it can be done in a matter of seconds.
You can simply open the account via Singpass, where you will then be directed to your Singpass account and authorize them to extract the information of your financials and income.
Once you passed the review (which for me takes about just under a minute), you will receive a default trading limit of about SGD 20,000. More limits can be given via in-app request if you need to go beyond this amount.
With this, you can start leveraging on opportunities to buy and sell stocks, ETFs, and other securities through contra trading without the need for an initial capital deposit.
Conclusion:
Do You Really Need a Cash Boost Account After All?
Well, if you ask me whether you really need a Cash Boost Account – my answer is probably it depends on what kind of investors you are.
If you are a short term trader or investor who’s trying to leverage on short term opportunities, my answer is probably it’s worth giving a try.
Opening the Cash Boost Account is relatively simple and straightforward with no foreseen downside and it can supplement your main trading account well – whether you use it or not is another story altogether.
To me, this analogy can be likened to getting a credit card with a credit limit of $20,000 for free, but whether I use it or not is a separate matter altogether.
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