KGI Ong, Singapore’s first futures broker returns to retail
The story of KGI Ong participating in the retail FX space, is more about one of Singapore’s oldest brokers returning to retail.
Through an interview by email, Ken Ong, Senior Vice President, Global Futures, Options & FX presents KGI Ong, Singapore's first Futures Brokerage and a company with more than 30 years' experience in Futures and Derivatives. In my unqualified opinion, KGI Ong is a jewel and a marvel among Singapore's brokers.
KGI Ong is stepping up to the line with two forex platforms: MT4 and MaxxTrader. They are also running a promotion as well as a series of MT4 platform training as well as seminars. More on this shortly.
Singapore's first futures brokerage
Hi Ken, please introduce KGI Ong and yourself to our readers.
My title is Senior Vice President, Global Futures, Options & FX. I oversee the sales and trading of Futures, Options & FX at KGI Ong and am also a member of senior management at the firm in charge of strategy and business development. Previously I worked at a hedge fund in Hong Kong. I’ve also travelled extensively throughout the region and am fluent in a variety of languages (English, Mandarin, Cantonese, Korean and Japanese).
KGI Ong first entered the retail forex segment in 2006. Although the focus of the company has traditionally been local corporates trading futures and options, there has been a long time commitment to the success of the retail forex trader. In fact, the story of KGI Ong participating in the retail fx space, is more about one of Singapore’s oldest brokers returning to retail as other foreign competitors scale back or leave the industry. As an asset class, forex is one of the largest and most liquid and offers traders and investors a way to diversify their portfolio.
Tell us about your company's heritage. Why is this strength relevant to your target clients?
With more than 30 years of experience in Futures and Derivatives industry, KGI Ong was the first Futures Brokerage in Singapore and the pioneer Clearing Member of Singapore Exchange-Derivatives Trading (SGX-DT). Since its inception, KGI Ong was bestowed the member number "001" from GES and SIMEX and works with world-renowned exchanges such as SGX, CME, EUREX and LME to provide a comprehensive suite of products for our clients.
As a wholly-owned subsidiary of KGI Securities Co. Ltd. ("KGI Securities") - the second largest securities company in Taiwan, KGI Ong strengthens KGI Group's regional advantage in South East Asia and ensures clients enjoy a complete line of futures and derivatives product offerings, including foreign exchange and securities (options on equity indices).
Wide assortment of products, trading platforms to choose from
What kind of product/service positioning/feature will you promote to your target client? For example is it going to be price-based competition like tightest spreads in Singapore?
Due to our broad product offering of commodities, futures and forex we offer clients an ability to have exposure to various types of products with the same broker. Our value-add is highly personalized customer service that you would expect from a local broker with a strong Singapore connection heritage in the industry. We are here to stay, and to provide competitive and transparent pricing for our clients. Tight-spreads are simply the starting point for our offer. We offer STP order execution via our MT4 platform and an uncompromising approach to bring you the best quality trading experience.
- One-stop shop to provide a complete line of futures and derivatives products (including foreign exchange) for our clients
- Direct access to world's leading futures exchanges
- More than 150 futures products to trade through our dealers or online platforms
- Over 30 currency pairs and metals crosses via our MT4 desktop and mobile platforms
- 24-hour broker assisted dealing and execution services
- Product teams that are highly experienced, professional and committed to help you succeed
- Variety of cutting edge e-trading platforms that are user-friendly and effective to suit your needs
- Powerful trading tools and resources to help you manage your trading successfully and efficiently
- Full clearing facilities for institutional, corporate and retail clients
We offer two methods to trade forex: Via the MT4 platform with advance charting functionality and Straight-Through-Processing or via Maxx Trader with streaming NDFs.
Who is your targeted client?
The focus is on the Singapore market with secondary audiences in Greater China (Taiwan, Hong Kong, China) as well as South East Asia as a whole. Due to the nature of the business, there are several market segments. Our futures products are geared towards corporates who are trading physical goods or professional traders looking to speculate. Our forex products are aimed at seasoned retail traders familiar with the MT4 interface.
Do you have a demographic profile in mind?
Retail traders come in all shapes and sizes. If we had to articulate a target demographic, it would be someone aged 21 to 60, likely a Singaporean or PR with an annual income of SD65K and investable assets of SGD 150K.
Is opening account size a criteria that you are looking at?
For our retail forex accounts, we look for a minimum SGD 1000 to begin.
Customer approach and customer care
Will you be competing in activities, client education, competitions for example?
We provide regular monthly in-office training on the MT4 platform as well as specialized seminars in a variety of topics including risk management, trading psychology and goal setting. In addition, we participate in local and regional trade expos such as Iron Ore Week or InvestFair sponsored by Share Investor. This year, we will be a standard sponsor and hope to see our clients in person at Suntec in August as well as meet new potential customers.
I have many kinds of individuals in my trading blog including 1) early adopters of forex trading 2) ones who are still investing in stocks, doing contra trades 3) young aggressive individuals who want to trade in something higher leverage. I paint our some profiles below. Please tell us how you will convert these three profiles.
A. Imagine that there is an individual in his late 40s. He is a PMET segment and lives in a 5-room flat in the heartland. This person has been trading stocks on contra for the past 7 years. He also invested in some blue chips, holding them over the same period of time to collect some dividends. What will you tell this person about forex trading and how will you convince him of your brand and forex trading platform to him?
There are a number of reasons to trade forex in general and with KGI Ong in particular. First, here are some reasons to trade forex instead of or in addition to stocks: The fx market is so large that it is not as sensitive to the movements of large institutions or analysts. If you choose to trade on margin, the requirements for forex are less than those for equity trading. Finally, the forex market is open 24 hours a day.
With regards to KGI Ong, we are an SGX-Member and MAS regulated broker. We have over 30 years in the Singapore market as well as experience dealing in other regional and global exchanges. When you have an issue and call our customer service desk, you’ll speak to someone local at our office near Amoy Food Centre, not some foreigner overseas.
B. Imagine a second individual. She is an early adopter of forex trading and is trading through an overseas account. She is making money on forex trading and has no problem withdrawing her funds. How will you ask this person to trade with you?
Trading with an overseas broker is always fraught with a higher level of risk. The recent SHB situation was proof that no broker is immune to the challenges of the forex market. You need to pick a broker that is well capitalized, honest and preferably MAS-regulated. Trading with a local broker still gives you access to international liquidity. The key feature of an MAS-regulated broker vs a broker organized in abroad is the requirement that client and company funds are not co-mingled. Segregation of funds ensures that in the event that a broker becomes insolvent, you will still be able to recoup your deposited funds. Finally, having an account overseas may expose you to higher TT or transaction fees which will erode the precious trading gains you made.
C. Imagine a third individual. He has just finished NS/University and has $10000 savings. He wants to do something more aggressive than stocks since he is still young and with a 20-40x leverage, forex appears compelling. He thinks he may not meet KYC required by MAS to qualify a local forex account but an overseas account carries risk he does not want. What kind of path should this individual take?
He can always start with a demo account, and learn to trade for 3-6 months, to achieve local KYC standards. We have education courses and online resources that can support him to achieve this knowledge. We have conservative margin ratios, in line with MAS, and he can start small with a $1000 to get a live account, and can trade in micro or mini lots until he gets more experience.
- End of interview -
Promotion and events
As part of their "return to retail" strategy, KGI Ong is running a client recruitment campaign with a mix of promotion and events. For individuals who want to open their first forex trading account or for sophisticated traders to want a regulated broker in Singapore that provides a wide solution, this is a good time for that first encounter with big brother.
KGI Ong Refer-a-Friend Promotion
KGI Ong is running a customer recruitment promotion in the form of a referral for incentive program. If you are an existing KGI Ong customer, refer a friend and when friend makes enough qualifying trades, you receive trading credits. Not an existing customer? Organise a group, nominate one to sign up first and then refer the rest! More details here.
'Forecast for 3Q2015 by TerraSeeds Chief Trainer'
TerraSeeds Chief Trainer Binni Ong is guest speaker for an up-coming seminar on 24 June organised by KGI Ong. Binni will talk about her observations, how a trader should approach the 3rd quarter of this year and what one can expect from EURUSD and XAUUSD. Details over here. Please use the button 'Register Now!' to link to online registration page.