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Bursa Malaysia Implements Intraday Short Selling For All Investors

Bursa Malaysia Berhad (“Bursa Malaysia” or “the Exchange”) today implemented Intraday Short Selling (“IDSS”) for all investors as part of the Exchange’s strategy to boost market liquidity. This follows the announcement by Prime Minister Yang Amat Berhormat Dato’ Sri Mohd Najib Tun Abdul Razak on 6 February 2018 at the World Capital Market Symposium held in Kuala Lumpur of measures to enhance vibrancy and stimulate greater trading activity in the stock market.

The Exchange has implemented a clear framework to facilitate IDSS trades for all investors. Under the framework, investors will be able to sell securities first and buy the securities later within the trading day itself. IDSS can be carried out on a selected list of eligible securities (“Approved Securities”). This list of Approved Securities, currently comprising 280 securities, will be reviewed every 6 months.

Chief Executive Officer of Bursa Malaysia, Datuk Seri Tajuddin Atan said, “Introducing IDSS to a wider group of investors is timely considering the growing sophistication of market participants. This measure is part of the Exchange’s strategy to boost market liquidity and further improves flexibility for market participants to refine their trading and risk management strategies.”

“The Exchange will continue to undertake initiatives to provide a more efficient and facilitative market framework and the introduction of IDSS is set to further advance the Exchange’s efforts to build a dynamic and vibrant capital market.” Datuk Seri Tajuddin concluded.

A robust compliance requirement and safeguards have also been put in place to allow for IDSS trades to take place. This includes market controls for IDSS suspensions if a stock price falls by more than 15% from the previous day closing price or if the gross short selling volume exceeds the daily maximum limit of 3% of outstanding shares per security. The framework also specifies compliance obligation requirements for investors before IDSS activities can commence.

To allow investors to carry out IDSS, the Exchange has amended the Rules of Bursa Securities, Directives and the Participating Organisations’ Trading Manual. The rule amendments have been approved by the Securities Commission Malaysia.  

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