KUALA LUMPUR: Retail investors are advised to be cautious of social media chatrooms that promote specific stock trading based on speculation or rumours.
In a joint statement today, the Securities Commission (SC) and Bursa Malaysia Bhd said investors should be wary of discussions in these social media chatrooms that may trigger securities breaches such as the provision of investment advice or stock recommendations without a licence.
"We are closely monitoring the local stock market in light of the current price surge of selected stocks in the US markets, fuelled by social media chatrooms against short-sellers," they said.
Both agencies warned that any person found guilty may be liable to a fine not exceeding RM10 million or imprisonment not exceeding ten years or both.
The SC and Bursa said market dynamics between the US and Malaysia differed as the latter's regulated short selling (RSS) was only applicable to approved securities in the RSS list, which currently comprises 218 securities.
They said limits were also imposed to prevent excessive short-selling activities.
Additionally, the SC and Bursa said RSS trades required investors to either borrow the approved securities to be short-sold or have confirmation of borrowing of the approved securities.
As such, RSS must be undertaken in a designated account where sell orders must be placed at the best offer price or higher.
The SC and Bursa will conduct real-time monitoring of all trading activities to detect, analyse and escalate trading concerns promptly.
They said robust frameworks were in placed to ensure an efficient, fair and orderly market.
"Where warranted, the SC and Bursa Malaysia will take the necessary measures to curb disruptive trading practices and market abuse," they added.