The Fixed Income market is the most important part of Malaysia’s Capital market. As of date, Malaysia has RM1.4 trillion bond and sukuk currently outstanding in the capital market. This market provides an avenue for both the corporations for funding and the financial institutions for its fixed income return. Historically, this asset can only be purchased by institutional investors or high net worth individuals due to its high barrier of entry. While we can purchase stocks for 100 unit per lot, 1 lot for bond & sukuk stays at RM5 million and lowest RM250,000 odd lot for high net worth individual investor.
However, Securities Commission Malaysia (SC) launched its seasoned bond framework which facilitates access for retail investors to purchase bonds & sukuk that were originally issued for institutional investor in the primary market. You can read more on the framework here
but some of the highlights from the guideline are as below:
- Denominated in Ringgit Malaysia
- The bond must have a remaining tenure of more than 1 year
- The bond must have been issued for at least 1 year
- The bond must have a minimum credit rating of A (Read more about rating here)
In 2019, iFAST becomes Malaysia’s first retail bond eligible distributor
in transacting bond and sukuk with retail investors. The names of distributors in the Eligible Distributors List here are approved by the Securities Commission Malaysia and will continue to be updated when new distributors come into the market. Investors can now find all the information needed in regard to Bond & Sukuk investing in Malaysia in one free website at www.bixmalaysia.com
. Retail investors can now make an informed decision when investing in Bonds & Sukuk by using BIX Malaysia which centralized data from SC, Bank Negara Malaysia, Bursa Malaysia and other related parties.
Click this link
or you can find it under the News & Announcement tab to start investing in bond & sukuk. You can also read other articles to learn more before investing in Bond & Sukuk.