It ranges on a continuum from pure factual statements, to calculated parameters, to outright buy/sell/hold recommendations. While investors often use factual information concerning securities to guide their decisions, MAS takes the view that factual information itself is not investment advice. Data based on historical time series are facts, whereas forecasts would be considered subjective. Further, filtering data through the choice of parameters, for example, to display only shares with favourable financial ratios, would be considered selective, and would require licensing. The “fact versus opinion” principle sets out quite clearly what would require licensing as investment advice. Nonetheless, in this information continuum, there remain some grey areas involving implicit advice. For instance, where the interpretation and presentation of facts leads to a specific conclusion, MAS would need to review the context and circumstances, such as other information on the website, to decide whether licensing is required. Analytical tools: a common device which challenges our interpretation of “advice” is an analytic tool, for instance, computer software aimed at facilitating investment decisions. Such a tool may require licensing. In making this judgment, we would consider the output of this tool, subjecting it to the “fact versus opinion” test. If the output goes beyond factual information, and includes subjective or interpretative content, this tool would require licensing.9 Other securities regulators have adopted the same stance in regard to the provision of implicit investment advice.

A broad spectrum of activities could possibly constitute “dealing in securities”: broking in securities, referring customers to open accounts with licensed dealers for the purpose of trading in securities, or providing prospectuses and application forms to prospective customers. As for “investment advice”, our current interpretation accepts that the provision of factual information does not constitute investment advice. What constituted dealing or investment advice used to be fairly clear-cut and well-established. But the breakdown of the securities value chain has blurred the distinctions between fact and investment advice, and between dealing in securities and merely providing information. We therefore need to refine our interpretation of these terms, institute basic safeguards and spell out how to treat new entities. Licensing approach In licensing investment advisers and dealers, our approach is to require persons conducting securities activities in Singapore to possess suitable qualifications, relevant professional experience and good character. This would give comfort to investors that they can expect competent advice and reliable execution from investment advisers and dealers. Our licensing requirements for the new electronic market intermediaries should not be unduly onerous. They will not impose heavy prudential capital requirements. The main focus will be on website disclosure of credentials, physical addresses and other relevant information. In lieu of a corporate track record, licensees need only demonstrate individual qualifications and experience. Bona fide intermediaries who subscribe to the objective of providing financial services of high standard should be pleased to come under our licensing ambit.