A couple of my blog readers asking me on how to trade or invest in Bursa Malaysia? In order not to disappoint them, I will write a series of article for a beginner to start invest or trade in Bursa Malaysia.
I will also explain other information related to it such as the process of buying or selling shares itself.
Part 1 – How to Open Trading and CDS Account for Trading in Bursa Malaysia?
Part 2 – How to Buy and Sell Shares in Bursa Malaysia?
Part 3 – How to Determine Trading Settlement in Bursa Malaysia?
Part 4 – How to Calculate Profit, Loss and Brokerage Fees in Stock Market Trading?
In Malaysia, stocks or shares are listed in Bursa Malaysia Stock Exchange (Bursa) which formally known as Kuala Lumpur Stock Exchange (KLSE).
In order for you to invest or trade shares that are listed in Bursa Malaysia, you need to open Trading Account and CDS Account. Below are the steps for you to follow.
Step 1 – Open trading account
You have to open trading accounts with stock broker or participating organization that is registered with Bursa Malaysia. You can find the list of stock broker companies at Bursa Malaysia webpage. You are recommended to visit their office to open an account so that their representative can verify your documents.
Some stock brokers allow account opening via internet but you need to get your documents certified by Notary Public.
Step 2 – Choose between Nominee or Direct Trading Account
Normally, stock broker provide two different trading account namely Nominee and Direct Trading Account.
For Nominee trading account, basically you appoint your broker to hold shares on your behalf. It means that, once you buy shares, your name will not show on the registration book of existing shareholders directly, instead it will show your Broker Name.
The advantage is, you do not need to do any paperworks such as fill up forms for bonus issue, right entitlements and others. The most important is your broker have to remember the dateline for all the paperworks, not you. But you still need to instruct them on what to do.
However, the disadvantage of nominee account are you are not eligible to apply for IPO and you may not receive the annual report or some gift vouchers easily.
Direct Trading account is exactly the opposite of Nominee Trading account.
You may choose to open nominee account with one broker and direct account with another broker.
Step 3 – Choose between Cash Upfront or Collateralised Account
Some brokers have an option for you to choose between Cash Upfront or Collateralised Account. For Cash Upfront account, total trading limit of the day is equal to the amount of cash you have in your trust account. The advantage of Cash Upfront account is lower brokerage fee.
For Collateralised Account, you are allowed to trade beyond the amount of cash that you have in trust account. Normally, broker allows at least 2 times the amount cash that you have. On top of that, if you have shares in the attached CDS account, they also can be used as collateral to increase your trading limit.
Trust account is an account where your broker keep cash that you deposited. They may pay interest on the money keep in this account.
Step 4 – Decide to invest Online or Offline
To invest or trade in Bursa Malaysia you can have either do it via Offline or Online but now, most of the brokers in Malaysia provide online trading platform.
For Offline Trading account, you will have a real people called remiser who will handle all your orders. You will have to contact your remiser through what ever means for buy or sell shares.
For Online Trading Account, all of your orders are made through internet application which nomally load through internet browser of your computer. Some stock broker also allow to do transaction via PDA phone or mobile phone.
The main advantage of Online trading Account over Offline Trading account is lower brokerage fee. For online trading account, you may call helpdesk for trading but they may impose high brokerage fee.
You can look at the list of stock broker companies that offering online trading here.
Step 5 – Open Central Depository System (CDS) account
Next, you have to open CDS account. Your chosen Stock Broker will assist you to open CDS account.
CDS account is an electronic account which maintain by Bursa Depository or formerly known as Malaysian Central Depository.
CDS account is used to keep track or your shares or stocks movement. Shares will be credited to your account when you buy and debited from your account when you sell on due date.
You need to fill and sign in CDS Opening Account Form (FMN01). At the same time you have to sign two copies of specimen cards and provide copies of your identity card (NRIC). The fee for CDS account openning is RM10.
If you have multiple trading account, you have to open separate CDS account for each trading account. Sharing CDS account is not allowed.
Update 8th April – Add “Choose between Cash Upfront & Collateralised Account”
Thanks for sharing this valuable information. I can ask my friend to come to your page and read! Yeah!
To use online trading platform, i believe we need to have direct trading account right?…Just want to confirm that….
No, you can use Nominee account for online trading.
Great info..can’t wait for part-2
Thanks. This really help.
Nice tips. I should write some of these too. 😉
May I ask..
When opening a trading account with the bank, they say you must have at least RM10,000 to RM1,000 (depending on which bank) in the account at all times..
Is this value in the form of the balance in the account or balance + shares?
Eg.. RM 100 balance + 100 ABC shares priced at RM9.00.
And does this mean that even if you just want to trade for RM500, you still need RM 1000 in your account??
Is there a difference in the minimum amount that we need to have in our account between the nominee account and the direct trading account?
p.s: I am a new with this. I wish to trade but don’t have a big capital. Sory for all of the fuss
Sorry, I do not know the minimum to open account. You may want to check with the broker.
Not to discourage you but if you to trade for that small amount, it is quite difficult to gain as the fees associated will eat your profit. Unless the stock that you buy increase substantially.
Hi this is helping. thx a lot. but I do have some questions. How if I am just a university student and I wish to trade? First I knew that I have to open a CDS account right? If I wish to trade under osk company can I open the CDS account through the maybank and then apply for a trading account through the osk company? Besides they also require for some documents which students don’t have so do I still have the chance to get the account to trade online?
Hi, I think you may not be able to open account until to have some jobs but I may be wrong.
I’m using PBE Broker…is nominees…
Cannot APPLY IPO…
So can I just apply direct share trading accound which is Jupiter or TA…then use their CDS number to apply in pbe broker ? hope can help ! Thanks !!
You have to open direct trading account with any broker. When apply for IPO, you have to use the Direct CDS no. If you get the IPO, the shares will be credited to your new Direct CDS account with new broker.
Ok ! Thanks you very much !!
I will change to public investment bank soon…
By the way… Once I register already…
Then can I open another direct trading share which is Jupiter or TA…then use their CDS number and key in to my public invstment bank to apply IPO ??
Coz those Jupiter broker fees is cheaper !!
Wait your reply !! 😀
You can open another trading account with your preferred broker for example Jupiter. Each trading account will have separate CDS account number. You have to use your new Jupiter Direct CDS account number when applying for IPO. The shares will be credited to your new Jupiter account and not Public Investment bank.
Ok ! Thanks you very much !!
Last question ~ I just register Hwangdbs CDS account ~~
Next step .. I will going to open maybank2u account ~
After that..use the Hwangdbs cds to apply ipo thru maybank2u ?
Should I open Saving account / Share trading account in Maybank2u coz of applying IPO ?? And… Need to open Maybank Cds number ?(Got two CDS which is Maybank and HwangDbs )How? ?_?
i wished to register at cds account please guide me
Vin, Your HwangDBS is enough. Just enter your CDS Account no (from HwangDBS) in Maybank2u. All set.
Ok !! Maybank2u got 2 option to apply…Should I go for both ??1.eShare Application
2.Maybank Investment Bank Share Trading
So I just go for Option 1 enough ?? Since I dont want to use Maybank Investment bank (share trading) coz hwangdbs already have It !
Thanks for fast reply ! (^.^)
You should go for eShare Application.
I love this blog very much !! 🙂
Vin, I happy that you like this blog. Hope you earn a lot of money from share investment. 🙂
Hope Can EARN MONEY …
But Firstly MUST have your BACKUP ! :p
Heard them say…Is It very hard to success to get IPO ??
My friend apply IPO : Pchem ~ 100lots…ALL REJECTED !
Student is not eligible to open a trading account & CDS account??
I’ve checked on the Bursa Malaysia website for the broker participants, I’d like to open both trading account & CDS account with Maybank, but is it any Maybank outlet can do it, or I must go to the outlet address that stated in Bursa Malaysia?
I am not sure whether student can open or not but you will be ask for your income & net worth while opening the account.
Regarding Maybank, I can’t help as I do not have account with them. Suggest you go to nearest Maybank branch & ask.
I’m just got Hwangdbs CDS number…
Can I apply IPO thru maybank WITHOUT OPEN HwangDBS ONLINE TRADING ?? Coz the remiser just gave me the Hwangdbs CDS number .. (=.=)
Vin, as long as you have direct CDS account, you can apply for IPO but if you don’t have online trading account, you need to call your remiser to sell the shares.
Ok ! Can I check the CDS number is under my name or not ??
because I never see the remiser before…just my friend introduce in phone… and he tell me my cds number in phone too… If I call him and sold my shares… Then he will send the money to my maybank account ?
Hope can help ! 🙁
Just receive letter from Bursa Malaysia Hwangdbs CDS Number 😀
But It wrote Name of Bank : Public Bank…. and Account Number …
Hope I stil can apply IPO thru MAYBANK !! (^_^)
Vin, if you received letter from Bursa Malaysia Depository, then it should be OK. I think, for nominee account you will not received this. Just confirm, it is from HwangDBS or Public bank.
I received the letter from Bursa Malaysia ~ And It Is Hwangdbs Cds number…So now I’m just open Maybank and type Hwangdbs Cds number to apply IPO ? That’s all ??
Because last time I’m register Hwangdbs CDS ,I was sent Fotocopy Public Bank Front Page And NOT Maybank to register…
Just key-in your Hwangdbs CDS Acc no while applying IPO from Maybank2u.
Ok ! Thanks again !! 😀
hi i would like to know, what is the minimum capital and the max capital to make this trade? i want to have it,but seems i don’t know how.. hope you can help me. thank you for your note on this trading. now i know the step, just the amount of capital that not show up. =)
siti, I’m not sure the minimum but I believe as long as you have money in the account, you can start trading based on your available capital. I don’t think there is maximum, stock market will always be bigger that the money that individual can accumulate.
Already sent 2 emails to CIMB and interpacific to ask regarding the information to open trading account with them, but no one reply. Is it because i am just a engineer (salary abt 8k), not the rich businessman, so they lazy to entertain me???
Hi, Just one question, if blacklist, are they able to open either one account for invest?
salha, I think there is no problem as you have to put in money before you can invest. Anyway better check with your preferred broker.
hi, may i know what’s the difference of opening a direct CDS account between banks(maybank,cimb,etc.) and securities companies (jupiter,jpmorgan,etc.) Thanks.
james, it should be the same.
hi million, is there any bank’s research report is desirable or can be considered as reference?
Thanks again !
james, you can read the report but don’t believe 100%
Hi, may I know how can i trace the shares that i bought from which broker? I can i sell the shares if i use different brokers.
June, you can only sell the share that you buy from the same broker unless you do share transfer. Your broker should have list of shares that you have.
Hi Million, so it means i can apply CDS account ,say from CIMB and then apply a trading account with different bank? and for oversea trading ieUS market which bank is preferable?
PEGA, no you have to open CDS & trading account with the same broker. For overseas trading in the US, I prefer to open with US based broker.
wow.. this seem so complicated..
Is there any minimum amount we need to bank in when opening the CDS account???
peer, I think no minimum to open but you need to have money before you can trade.
any 1 know which securities can use samsung note to view and trade?
did any 1 can suggest which forex company is adviceble and can use samsung note to do trading?
Hi, I do not know that eIPO must be applied using own bank account (which match to the CDS account), I have done one application where the two accounts are from different owners. Will it be rejected and refunded?
In that case, if I still interested to apply for the IPO, am I able to apply another eIPO using the same CDS account with another bank account (but now the two accounts are from same owner)?
hey thanks for the info….it was helpful
I have a question …what is the maximum number of days you can hold on to a share.
no maximum as long as you pay for it 🙂
1. If I open a CDS and trading acc with Maybank, is it possible to buy shares in other companies let’s say Nestle?
2. Would they use my savings in Maybank account if something goes wrong in my trading?
3. To buy shares, I have to pay once right?
4. How much money should I have to buy shares?
Hope you can answer my questions. Thanks ya.
1. you could but any stock listed in Bursa Malaysia
2. you can check with Maybank
3. yes, have to pay for it
4. it depend how many you buy. Calculate before you buy.
Good info. Thanks.
Can you add if any demo accounts for Malaysian equity available or not and links if possible???
Can you create an online account if you are not malay and/or do not live in Malaysia?
e.g. I live in Europe and would like to trade/invest in KLSE .. possible?
I do the same with the US – purely with online accounts.
Hi, great info. I have 2 questions.
1. If I already have a CDS account with a trading account with broker A, can I just open another trading account with broker B and associate that with the existing CDS account?
2. Does all brokers offer both direct and nominee trading account?
Thank you very much.
2. Not necessary. You ca check with your preferred broker.
a) If I have a direct CDS account with CIMB, and I applied IPO through other remisier using that CDS account, the shares will go into my CIMB trading account? Since the IPO only input the CDS account number, how can I choose which trading account they should allocate my shares to?
The share will be allocated to the CDS account that you use during the application.
The CDS account is link to the trading account I initially open?
If not how can I sell the shares?
You have to check with your remiser.
What is CIF and SIC Code? Are they recognize by Bursa or internal to trading agents?
I am a Non-Malaysian Expatriate. Just wanted to know that is it possible to apply CDS and Trading account for Non-Malaysians ? Just for your info, my company had applied for me to have MayBank and PublicBank Saving Account. I am using both bank account currently. Your response would be highly appreciated.
I found out that it is eligible for foreigners to open CDS and Trading Account. Sorry to bother you. Thanks anyway!
Thanks for sharing your expertise on share investment.
I would like to know if all of the information as presented above is still valid as of this year (2014).
Can you please advice how can I buy HK share online?
I just check with AMSecurities I need to pay RM150 fee for RM5k share purchase in HK. There is no online trading for HK share for Amsecurities. Any cheaper way?
Hi jen, check out this post
Check out the recent article suggested above which I co-wrote.
It outlined how you can invests overseas in multiple markets.
RM150 fee for RM5k shares is considered expensive, the article outlined that it is much cheaper using CIMB. CIMB specified the fees to be around HK200 or so, which is quite reasonable (divide by ~2.5 to convert).
Thank you very much for the direction, now I can compare beyween Amsecurities and CIMB i Trade.
I have a CDS account with one unit of stock. But I have not done anything about for many years. Can I trace it?
Contact your broker.
Do I need pay slips to attain a CDS account? Are there alternative ways to go about trading if I am not working?
I don’t think you a need payslip. As long as you can deposit money to trade, you should be OK.
assalamualikum, i m from bangladesh, i want to know about the procedure of invest in malysian stock market
Does anyone know if there is any way to purchase shares from Taiwan?
If i want to apply for IPO i need to have the CDS account, but reading at this post izzit means that i need to apply for trading account first then only cds account?