SECURITIES brokerage CGS-CIMB Singapore has expanded its private-market product offerings, and is now giving all individual accredited investors on its platform access to ADDX’s offerings.

In a joint statement on Monday (Dec 19), both CGS-CIMB and ADDX said the brokerage can now distribute a “full suite of deals” on ADDX to its high-net-worth clients. These include private equity, private credit, venture capital, hedge funds, real estate, fixed-income products like bonds and commercial papers, as well as structured products.

The partnership allows CGS-CIMB to expand its shelf of private-market products considerably, the companies said, noting that the brokerage was previously more focused on public markets.

The partnership is part of a new service called ADDX Advantage, which was rolled out earlier this year to serve wealth managers, including private banks, brokerages and external asset managers. CGS-CIMB was among the first to sign up for the service, the companies said. 

ADDX aims to on-board as many as 10 wealth managers by the end of next year.

ADDX Advantage enables the performance of life-cycle management of securities on behalf of wealth managers, covering actions such as subscriptions, dividend payments, redemptions and secondary trading. 

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As a sub-custody partner, ADDX also allows wealth managers to retain custody of their clients’ assets. Wealth managers using the service get an instant plug-in to ADDX, which has listed more than 50 deals so far. They avoid having to originate and negotiate deals with each issuer or fund manager separately, which can be a time-consuming process.

Wealth managers can choose either to enable end-investors to manage their own holdings on ADDX, or to have their relationship managers create and manage sub-accounts for them. 

The platform is also designed to adapt to wealth managers with different business models and regulatory requirements. The relationship managers then execute trades and perform fund transfers on behalf of their clients, ensuring a more seamless experience for investors.

The use of blockchain and smart contracts by ADDX enables the fractionalisation of investments, down to as low as US$5,000, as opposed to the US$1 million typically required when going direct to issuers.

Choo Oi Yee, chief executive of ADDX, said assets under management for private markets are slated to nearly double to US$18.3 trillion in 2027, from US$9.3 trillion in 2021. 

“Individual investor allocation to these alternative assets is likely to rise faster than allocation by institutional investors because technology is democratising access for individuals,” she said. 

“Serving wealth managers will be a key pillar of growth for us in 2023. Our priority is to optimise the user experience for wealth managers, as well as to increase the breadth and depth of offerings on ADDX.”

Said CGS-CIMB’s managing director and group head for strategic innovation Elgin Ting: “As part of our mission to provide clients with an extensive suite of financial services, CGS-CIMB is always scouting for new offerings that can add value to our investors’ portfolios.”

He added that the partnership will give the brokerage’s high-net-worth investors access to private markets and opportunities that were historically accessible only to institutional players.