Malaysia Stock Market: Bursa Malaysia Berhad is an important member of the global stock markets, with a history dating back almost 80 years. Established in 1930, the Singapore Stockbrokers Association was the first sanctioned securities trading organization in Malaysia. This Malaysian stock market association was renamed the Malaysian Stockbrokers Association in 1937, but it did not yet trade shares publicly.
In 1960, public trading of shares was inaugurated on the Malaysian public market, called the Malaysian Stock Exchange. The Malaysian Stock Exchange was the predecessor of the modern Malaysian stock market. The Malaysian Stock Exchange was renamed the Malaysian Stock Exchange in 1964.
The operations of the Malaysian stock market continued as the Singapore and Malaysia Stock Exchange (SEMS) after Singapore seceded from Malaysia in 1965. The exchange was divided into the Singapore Stock Exchange and the Singapore Stock Exchange Board. Kuala Lumpur Securities in 1973, after the separation of the Malaysian and Singaporean currencies. In 1976, the Kuala Lumpur Stock Exchange was incorporated to take over the operations of the KLSEB. The KLSEB was renamed the Kuala Lumpur Stock Exchange in 1994.
Under the direction of the Demutualization Act, in 2004, the klse stock exchange changed from a non-profit organization limited by the guarantee of its membership to an entity limited by its shares, called Bursa Malaysia Berhad. At the time, the Malaysian stock exchanges had a market capitalization of US$189 billion. With the conversion, the stock market portion of the business was transferred to a wholly owned subsidiary, Bursa Securities. In 2005, Bursa Malaysia was listed on the Principal Board of Bursa Malaysia Securities Berhad.
The main index, called the Kuala Lumpur Composite Index (KLCI) passed the 1000 milestone in 2006 and as of June 2007 had a market capitalization of US$307 billion. Market operations are divided into a Stock Exchange, a Derivatives Exchange and an Offshore Exchange.
The largest companies are listed on the Bursa Malaysia Main Board of Securities, mid-market companies on the Second Board, and high-growth and technology companies on the MESDAQ market. There is also a separate board for offshore companies. Futures and options contracts are traded on the Derivatives Exchange, operated by Bursa Derivatives. These capital markets are regulated by various Acts of Parliament. The network of holding companies also develops and distributes comprehensive market information products and services.
There are many markets in which you can trade. For many, trading a small portion of their portfolio abroad can help reduce their exposure to what’s going on in North American stocks.