Bursa Malaysia Report — Trustable Investment Option after Covid-19?
Bursa Malaysia aimed for a RM12 1.4 million profit after tax PAT at the end of 2020 and the first quarter of 2021 (Bursa Malaysia, 2022). It represents an 87.5 percent rise in profitability, amounting to RM64.7 million, over the previous year’s 4Q2019. The primary cause for the rise is a 50.7% increase in operational revenue in the first quarter of 2020, which equates to RM228.0 million (Bursa Malaysia, 2022).
As a result, the organization’s position demonstrates the potential platform for investors. However, in order to reach a judgement, other financial facts or information must be evaluated.
At the end of the year 2020, the operating expenses increased by 9.2% in the first quarter of 2021 equivalent to RM69.4 million from first quarter RM63.5 million. The report is published by Datuk Muhammad Umer Swift who is CEO in a Bursa Malaysia (HIONG et al., 2021). The average daily trading value-added continues to grow with the increase by 100.8% equivalent to RM 5.1 billion in the 2021 first quarter from RM 2.5 billion in the first quarter of 2020 (Bursa Malaysia, 2022).
Hence, it reflects that there is a domestic retail investors in the marketplace who are playing the major role for the sustainability of the organization. There is also an easy access to the low interest rate investment and stock market there. The resilient performance in the market after 2020 which is expected to continue the investment and trading in the upcoming years.
As a whole, it is a potential market for the investors and there is a great attraction of the investor which is already present there in the form of having the average daily trading value ADT. There is an increase by 100.8% which shows that there is a great trust of shareholders or investors on the Bursa Malaysia. Therefore, till now, it is recommended for the investors to have the risk-free investment in the Bursa Malaysia which has successfully survived in the most challenging time.
Securities market registered trading revenue stood at RM150.9 million in the first quarter of 2021 (Musa and Razak, 2021). There is an increase by 93.3% in 2020 as compared to the previous years. There is a great contribution to increase the trading revenue. But there was a partial offset due to the lower number of trading days will also there. the trading velocity in the 2020 was a higher and it was standing at 31 percentage points which were equal to 70% compared to 39% in the year 2019 compared to the RM 78.1 million in first quarter of 2020.
However, there is a slight decrease in derivative market by 15.7 percent equivalent to RM 22.6 million in 2020 as compared to RM206.7 billion in first quarter of 2020 due to decreased number in the contracts for crude palm oil futures FCP and Bursa Malaysia KLCI futures (Tabibian et al., 2021). These were the days when decrease was there and the average daily contracts reduced by 6.1%.
However, the percentage is lowered which is not the greater concern for the investors to not to trust. But, there is a great focus on the daily trading which is increasing and it is potential market for the investor’s because of the increased trust of the investors and traders.
There are different investors and traders across the globe. Therefore, for Islamic markets, there is a higher trading activities with the title of Burj Al Salah BSAS with the increase in trading revenue by the percentage of 16% equivalent to RM3.4 million in the last fourth quarter of 2020 from RM 2.9 million in first quarter of 2020 (Musneh et al., 2021). There is a focus to develop the Islamic market to attract the participants and traders. Similarly, the market is going up while introducing the new Islamic products as well such as waqf ETF.
There is an addition in the products to go expansion of the company in the economic activities so that it can recover from the uncertainties. Keeping in consideration continuous impact of coronavirus this year, there was the continuation of support market participants for investors to boost the economy and there was relief measures to be the burden on the financial sector.
Therefore, in the three years there has been greater drafting change and 2020 report shows that there is a great roadmap for the Bursa Malaysia to attract the investors and trader. Thus, they should go for the investment as it is easier because it is the market with the sustainability and the financial sector to have profitability and trust building with the investors.
References
bursamalaysia. 2022. bursa malaysia. [online] Available at: <https://www.bursamalaysia.com> [Accessed 7 July 2022].
HIONG, H.K., JALIL, M.F. and SENG, A.T.H., 2021. Estimation and Prediction of Financial Distress: Non-Financial Firms in Bursa Malaysia. The Journal of Asian Finance, Economics and Business, 8(8), pp.1–12.
Musa, M.H. and Razak, F.A., 2021, July. Directed network of Shariah-compliant stock in Bursa Malaysia. In Journal of Physics: Conference Series (Vol. 1988, №1, p. 012019). IOP Publishing.
Musneh, R., Karim, A., Rahimie, M., Baburaw, A. and Geetha, C., 2021. Liquidity risk and stock returns: empirical evidence from industrial products and services sector in Bursa Malaysia. Future Business Journal, 7(1), pp.1–10.
Tabibian, S.A., Zhang, Z. and Ah Mand, A., 2021. Stock split rule changes and stock liquidity: Evidence from Bursa Malaysia. Journal of Risk and Financial Management, 14(9), p.406.
