How to Invest in Singapore Stocks

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The Singapore stock market may provide good investment opportunities.
The Singapore stock market may provide good investment opportunities. (Image: stock market analysis screenshot image by .shock from Fotolia.com)

The city-state of Singapore is a regional financial center of Southeast Asia and offers many investment opportunities. However the public companies of Singapore mostly list on the domestic stock exchange of Singapore without direct access by investors in other countries. It is still possible for foreign investors to invest in Singapore stocks using other methods. This type of diversification can be effective, as it exposes investors to markets that may perform better than their own country's during some periods.

Buy shares of Singapore companies that offer American Depository Receipts (ADRs) if you are investing from the United States. ADR stocks trade on American exchanges or stock markets just like any other stock. The issuing company is in another country but they have arranged to have their corporate shares trade elsewhere in addition to their own domestic exchange. Examples of Singapore stocks that trade in the United States in this way include Asia Pulp & Paper, Neptune Orient Lines and the Keppel Corporation. No special brokerage account or service is required to invest in these companies. Simply locate their stock ticker symbol and purchase shares as desired. The investment returns on these shares will be the same as if you had invested in these companies using the Singapore stock exchange.

Buy shares of a Singapore exchange-trade fund (ETF) if you want exposure to the Singapore stock market without researching individual companies. This method has many advantages over ADR stock purchases. While only certain Singapore corporations may list outside Singapore, an ETF tracks the majority of all stocks in that country, so you gain broader exposure to the market. This also obviates the chore of identifying individual Singapore companies for good investment opportunities. The iShares MSCI Singapore Index exchange-traded fund (ticker symbol EWS), for instance, offers investment returns similar to the overall returns of the major Singapore stock index. You may buy shares in EWS just as you would any stock and immediately own the equivalent of a diversified basket of stocks across the entire Singapore market.

Open an global trading brokerage account if you want to buy any individual stocks listed on the Singapore stock exchange. This option is ideal for investors who have knowledge of specific companies that could perform well. While ADR stocks are few and a Singapore ETF tracks an entire market, a global trading account allows the skilled investor to be precise with her investments. As world markets become more integrated, brokerage firms are making global trading more accessible. A typical global brokerage account is funded with currency from your own country but lists stocks on many international exchanges. When you buys shares in these companies, it is no different than a domestic brokerage account purchase within the corporation's home country. It is thus possible to invest in Singapore stocks with the flexibility of a citizen of that country.

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