Bursa Malaysia

To participate directly in Malaysian stock market, you definitely need to know a thing or two about Bursa Malaysia. At the very least, you should know that this place is where all the public companies are listed and where their shares are offered to public.

So what exactly is Bursa Malaysia? It is a public-listed company that operates the only stock exchange in Malaysia. What is an exchange? And why is it important?

Below is an explanation of exchange from Investopedia:

“An exchange is a marketplace in which securities, commodities, derivatives and other financial instruments are traded. The core function of an exchange is to ensure fair and orderly trading and the efficient dissemination of price information for any securities trading on that exchange. Exchanges give companies, governments and other groups a platform from which to sell securities to the investing public.

(Investopedia Definition Link)”

All the transactions of listed company shares happen in Bursa Malaysia. It is a centralized marketplace where we transact stocks. You can consider it as the stock market itself.

Importance of Bursa Malaysia

Isn’t there any other way that we can invest in a company? Yes, there is. You could take your money and go to your favourite company and propose to buy its shares, provided that the company is willing to take your money.  Assuming that the company is going to sell its shares to you, you would then have to draft an agreement or contract to show that you are a shareholder of the company and specifying what rights that you have as a shareholder. Imagine that you have to do all these procedures on your own. What a hassle! The stock exchange helps us to avoid this trouble.

Other than ease of transaction, what Bursa Malaysia offers us are transparency and security. Let’s take the previous example of buying the shares of your favourite company. What price should you pay for each share? You have no way to know except to accept the price given by the company itself. What if the company is selling it at a lower price to other interested investors? You cannot do anything about it too. Basically, the transaction process can be murky. In Bursa Malaysia, the price of a share price is displayed for everyone to see so you know exactly what price you are paying per share.  Furthermore, the transaction is secure. There is no risk of fraud when you transact in the exchange.

Sounds great isn’t it? You can just buy or sell shares in Bursa Malaysia wherever and whenever you like, as long as the market is open. In reality, it is not that simple. For you to buy a share, there must be a corresponding seller of the same share in the market and vice versa. Otherwise, your order will not be matched and the transaction will not be executed. That’s why sometimes our order will not be fulfilled.

Main stock markets

There are three main stock markets in Bursa Malaysia: Main Market, ACE Market and LEAP Market.

Market Description
MainCombination of Main and Second Boards since 2009

Contains 809 listed companies (as of 16/3/2018)

Is the main stock market of Malaysia
ACEACE stands for “Access, Certainty, Efficiency”

As a substitute for MESDAQ Market in 2009

Home of mainly technological stocks

Contains 117 listed companies (as of 16/3/2018)
LEAPLEAP stands for “Leading Entrepreneur Accelerator Platform”

For sophisticated investor (high net worth) only

Contains 5 listed companies (as of 16/3/2018)

So you can’t wait to invest in Malaysian stock market now? Hold on a minute. Do you have a CDS account already? Before you can trade on Bursa Malaysia, it is a requirement for you to open a Central Depository System (CDS) account and a trading account with a brokerage firm.  Thus, if you are ready to embark on the investing journey, please visit a brokerage firm in the soonest time.


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