I started trading in stock market a few month ago, but, i aware that, to those who just starting trading in stock market will feel some difficult, especially, dun’t known how to trade stock at Bursa Malaysia
To trade stock at Bursa Malaysia, the first question is: How to have a trading account and second question is how to start buying shares?
Do you qualify to trade at Bursa Malaysia?
You have to be at least 18 years old. If not, wait until your 18th birthday.
Step by Step Guide:
1. Open a Central Depository System (CDS) account:
You can do this by approaching an authorized depository agent such as stockbroking company and some banks.
- provide photocopies of IC (identity card)
- fee RM10
- You will receive the account document by mail.
2. Open a trading account with stockbroker:
This will be done simultaneously when you open the CDS account.
- need to provide income statement
- fill out trading account form the stockbroker will check your credit status at CTOS (Credit Tip-off Service) and stockbrokers’ defaulters’ list – in order to qualify you and set your trading limit
What do you need to know about CDS account?
it allows you to buy and sell shares
it also allows you to trade non-equity counters such as bond and warrants
it is something like a bank account – you keep cash in bank accounts, you keep shares in CDS accounts.
you can have more than one CDS account
there are two type of CDS accounts: direct and pledge
if you have a direct account, you will receive the dividend checks and prospectus mailed to your house.
if you have a pledge account, the stockbroker will receive the dividend payout and prospectus on your behalf. Then the stockbroker will bank in to your account.
normally banking stockbrokers will require you to open a pledge account.
you will get CDS account statement monthly. If there is no activity, you will still get the statement on June and December.
3. Get a remisier:
Normally your stockbroker will appoint one to you if you don’t have any particular preference.
- remisier has to be licensed by the Securities Commission remisier helps you make the order
- sell? or buy? at what price?
- get someone you like and trustworthy as your remisier
4. Buying and Selling Shares:
You can key in your order at online system provided by your stockbrokers, or call your remisier to make the order. If your buying order match a selling order, you will get a trade confirmation. The stockbroking firm will then send out contract notes to you specifying details of transaction.
5. Payment:
When you buy share of company S, your CDS account will be credited with share S at 9am on T+3 (T=transaction date). The 3 days only include working days. Your payment had to be made on 12.30pm that day. If not, your share will be forced sold at a contra loss or contra gain.
Fees involved:
- brokerage fees – maximum 0.7% of the value of total shares traded, normal practise is 0.6%
- Clearing fees – 0.04% of contract value subject to cap of RM500
- stamp duty – RM1 for every RM1,000 worth of value
