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Tag Archives: clearing fee

How to start share trading in Malaysia?

Posted on October 20, 2009 by liciece
8

Recently the economic is recovering from the recession.Thus,the share markets everywhere begin to show the growth.Many people may want to do some share investments as an alternative instead of buying mutual funds.So I just share with you how to start share trading in Malaysia.

KLSE(Bursa Malaysia)

Malaysia has only one share market-Kuala Lumpur Stock Exchange(Bursa Malaysia).Almost all buying or selling actions are taking place there except those direct deal/off market deal which normally involves in bulk transactions.Now we could go to open the trading account.

1.You could choose any securities(broker) company you like,perhaps you could consider whether it is close to your house and how the charges are.You could refer to this list for all registered securities.

The requirements for open a trading account in securities are very limited,normally the only requirement is you are above 18 years old.

2.Open a trading account and CDS account in the security

Trading account could be divided into two types-nominee account and direct account.

Nominee account:Once you buy some shares,your name will not show on the registration book of existing shareholders directly,instead it will show as XXX SECURITY-beneficial to YOUR NAME.

Advantage:Not necessary to visit the security frequently as they could help you deal with most matters(ie, banking in dividends,sign up forms for bonus shares/warrants etc).

Disadvantage:You can not apply for IPO using Nominee account.You may not receive the annual report,some gift vouchers easily.

Direct account:Once you buy some shares,your name will directly show on the registration book of existing shareholders.

Advantage:You apply for IPO using this account.You could receive the annual report and voucher from the company you invest directly.

Disadvantage:You may have to bank in the dividend by your own.If having some bonus issue,you may need to visit the security to sign up some forms by yourself.

However,I still prefer to have direct account. :)

The charge for open a trading account is varied from different securities,but most of them are free of charge.And commonly you only need to pay for RM10 for new CDS(Central Depositary System) account which is the account to electronically store your shares by some Malaysian law.

After you have a trading account and a CDS account,you are able to buy shares in the market.

3.Know the fees for each transaction

For buying or selling,it will occur some fees comprising of brokerage fee,clearing fee and stamp duty.

The brokerage depends on what methods you used to buy/sell shares-phone call or online.Commonly if you call for making the transaction,you will be charged higher,ie. 0.7%;if you make the transaction through online platform,you will only charged at 0.42%.

The clearing fee is 0.03%.The stamp duty is RM1 for every RM1000.However,I suggest you ask the details from the security.

These are all the basic stuff you need to do and need to know before you make the very first transaction.If you think you have absorbed all,you could start to enjoy the fun from share investment now.I think you could learn the rest knowledge from trading. :D

Posted in Finance, Info, Personal | Tagged brokerage, Bursa Malaysia, CDS account, clearing fee, direct account, KLSE, nominne account, securities, share investment, stamp duty, trading account | 8 Replies

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