A well functioning and established financial market is essential for any country’s economy, especially in high open economies such as Malaysia, where forex trade plays a vital role in investment. If the idea of buying and selling stocks, shares, bonds or currency thrills you, then we invite you to read through this section which will focus on financial markets in Malaysia, and how you can invest in them.
Trading on the Malaysian Stock Market
With the Malaysian stock market becoming popular among individuals in the country and around the world through online trading, the following is a guide which will help you buy your first shares or make a forex trade on the countries financial market.
- Know About the Risks
Before venturing into the financial market, you should be aware of your risk appetite, or in other words, how much risk are you willing to take. Just like when ordering a plate of food at the restaurant, you don’t go for the first meal on the menu, but that which stimulates your appetite. Some factors that may indicate your risk appetite include age, income, and the time willing to spend on your strategy, among others.
- Get a Central Depository System (CDS) Account
The next step is to identify a stockbroker or investment bank where you will open a CDS account for you to trade on the Malaysian financial market. The CDS account will help you track the movement of your shares or currencies, and when you buy securities, they are credited on the CDS account. After selling the securities, they are debited on the CDS account.
- Deciding How to Trade
The Malaysian government, through the securities commission, licences stockbroker agents who act on behalf of the investor. These agents charge a commission which differs from one stock brokerage firm to another. However, if you do not want to pay the commission, you may opt to trade by yourself, by opening an online trading account.