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The SC issues guidelines for stockbrokers to offer fractional share trading services

NST Business

KUALA LUMPUR: The Securities Commission Malaysia (SC) today issued guidelines for stockbroking companies to offer fractional share trading services for shares listed on Bursa Malaysia.

A fractional share is a portion of a stock that is less than one standard board lot.

Trading of fractional shares was one of the capital market initiatives announced by Prime Minister Datuk Seri Anwar Ibrahim  in June this year, to make share trading on Bursa Malaysia more accessible and affordable for the retail investors, particularly the young investors.

Among the key requirements under the guidelines is the need for 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 offer of fractional shares will allow retail investors more access to the more expensive blue-chip stocks, at a fraction of the standard board lot value.

"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," Awang Adek said.

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