The Securities Commission Malaysia (SC) has revised its guidelines to allow stockbroking companies to offer fractional share trading services for shares listed on Bursa Malaysia.

Fractional shares are portions of a stock that are less than one standard board lot. This means that investors will be able to buy and sell shares even if they cannot afford to buy a full share.

The revised guidelines take effect today and require stockbroking companies to implement adequate systems, policies, and procedures to ensure fair treatment of customers’ orders, price transparency, and proper supervision of the fractional share trading service.

The SC chairman, Dato’ Seri Dr. Awang Adek Hussin, said that the introduction of fractional share trading would make share trading more accessible and affordable for retail investors, particularly the younger generation.

The updated guidelines can be found here.

Dato’ Seri Dr. Awang added,

“In addition, the introduction of fractional share trading would allow retail investors to diversify their portfolio, whilst creating a more inclusive capital market for all Malaysians.

 

To support the orderly development of the capital market, it is important for stockbroking companies to have the necessary controls and systems to safeguard the interest of the investors.”

This was one of the capital market initiatives announced by YAB Prime Minister Dato’ Seri Anwar bin Ibrahim earlier in June this year to make share trading on Bursa Malaysia more accessible, affordable and inclusive for the retail investors.