{"id":16022,"date":"2015-09-18T10:22:12","date_gmt":"2015-09-18T02:22:12","guid":{"rendered":"https:\/\/www.imoney.my\/articles\/?p=16022"},"modified":"2025-04-08T15:22:11","modified_gmt":"2025-04-08T07:22:11","slug":"how-to-start-trading-on-the-malaysian-stock-market","status":"publish","type":"post","link":"https:\/\/www.imoney.my\/articles\/how-to-start-trading-on-the-malaysian-stock-market","title":{"rendered":"How-to: Start Trading On The Malaysian Stock Market"},"content":{"rendered":"

This article is sponsored by Securities Commission Malaysia, under its InvestSmart initiative.<\/em><\/p>\n

\"securities-commission-malaysia\"<\/a>\u00a0 \u00a0 \u00a0\u00a0\"invest<\/a><\/p>\n

Watching share prices rise and fall can leave a beginner frozen with fear, especially those who are not used to the volatility[1]<\/a> of the stock market. But whether you call it stock market trading, or owning and buying shares, the process itself is not too difficult to understand. Here is a simple step-by-step guide on how to acquire and trade your first shares in Malaysia\u2019s stock market:<\/p>\n

<\/span>Step 1: Evaluate your risk appetite<\/b><\/span><\/h2>\n

Like ordering food from a menu, you would never just order the first dish you see. You would consider what stimulates your appetite the most before committing to order. Similarly, before deciding on what stocks to buy, you must evaluate your risk appetite[2]<\/a>.<\/p>\n

There are several aspects that can help you evaluate your investment risk appetite:<\/p>\n

\"how-to-start-investing-in-stock_2\"<\/a><\/p>\n

<\/span>Step 2: \u00a0Open a CDS account<\/b><\/span><\/h2>\n

Investors who wish to trade in securities listed on Bursa Malaysia must first open a Central Depository System (CDS) account with stockbroking companies\/investment banks.<\/p>\n

The CDS acts as a means of representing ownership and movement of securities. It allows you to buy and\/or sell shares, and to track your shares\u2019 movements. Securities you buy will be credited into the CDS account, while securities you sell will be debited.<\/p>\n

To open a CDS account, you will generally need to provide a copy of your identity card and RM10.<\/p>\n

You will also need to open a trading account. This is usually done simultaneously with the opening of the CDS account.<\/p>\n

You can find the list of licensed stockbroking companies on the Bursa Malaysia or Securities Commission Malaysia website<\/a>.<\/p>\n

<\/span>Step 3: Be with a broker (who won\u2019t leave you broke)<\/b><\/span><\/h2>\n

Once you have set up your CDS account with the stockbroking company of your choice, you will need to select a remisier (an agent of a stockbroking company that is licensed by the Securities Commission).<\/p>\n

You can find out more about finding the right broker here<\/a>.<\/p>\n

The standard brokerage fee is around 0.40%, with the cheapest being around 0.05%. To find out which broker has the lowest fee, check out iMoney\u2019s\u00a0share trading account comparison table<\/a>.<\/p>\n

<\/span>Do-It-Yourself (DIY):<\/b><\/span><\/h2>\n

Alternatively, you may opt for the DIY route by opting for an online trading account. The most attractive aspects of online trading are its lower brokerage fees and convenience.<\/p>\n

There is also less potential for human error \u2014 Incidents such as your broker making a mistake, or execution delays when your remisier is not in the office or is busy with another client will no longer occur.<\/p>\n

Trading online also allows investors the convenience and flexibility of trading anytime, anywhere, and on various devices. Investors are also able to check real-time stock processing, and access account portfolios and trade history online.<\/p>\n

However, the downside is that with so many stocks on offer, a novice investor may get a little confused or overwhelmed and end up making a loss especially if they have little or no prior investing experience, which is why the next point is especially important:<\/p>\n

<\/span>Step 4: Do your homework <\/strong><\/span><\/h2>\n

Trading shares is not for the weak, and especially not for those seeking an easy way out. To reap the rewards, you will have to do your homework by researching the companies you wish to invest in. This includes taking the time to analyse the company\u2019s business strategies, the quality of management, its relationship with suppliers and customers, and more.\u00a0 You must also keep track of corporate developments through sources such as the Bursa Malaysia website\u2019s \u201cAnnouncements\u201d page and the news.<\/p>\n

There are no sure-fire ways to make money from trading in shares, but here are some common principles that most share traders live by:<\/p>\n