08 February 2018
Kuala Lumpur
Reporter: Brian Bollen

Malaysia to liberalise short selling

Plans to liberalise short selling arrangements in Malaysia will be rolled out over the next few weeks, according to Tan Sri Ranjit Ajit Singh, executive chairman of the country’s Securities Commission.

Speaking at the fifth World Capital Markets Symposium held in Kuala Lumpur on 6 February, Singh said: “Short selling arrangements have been in place locally for a number of years, and more recently we allowed intraday short selling by proprietary traders.”

“Other market players have said they want to do it and we feel comfortable that there are now sufficient safeguards in place to allow it.”

“But there must be a borrowing arrangement in place so that positions are covered by the end of the day. We do not allow naked short selling at all.”

Singh hosted a press conference in the wake of his introductory speech to the symposium, which he described as a milestone event in attempts to nurture sustainable capitalism. In particular, he warmly referred to a specially composed video address by His Royal Highness the Prince of Wales.

Other announcements unveiled in the course of the week included the news that the securities commission and the Monetary Authority of Singapore will work together to facilitate the establishment of a stock market trading link between Bursa Malaysia and Singapore Exchange by the end of this year.

Singh described this as an important step towards encouraging the Association of Southeast Asian Nation (ASEAN) investors to invest in the region.

He explained: “The ease of accessibility for investors will contribute towards greater vibrancy in our markets. It can form the basis for future connectivity among ASEAN markets.”

Prime Minister Najib Razak, keynote speaker at the symposium, explained that “after extensive discussions with the Securities Commission, I’m delighted to announce that intraday short selling will be allowed to all investors,” among other measures.

He added that the introduction of intraday short selling to Malaysia is just one of the steps that have been taken “to ensure that [Malaysia does] indeed participate in a renaissance of capitalism and that [its] growth is shared by all”.

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