KUALA LUMPUR, Aug 26 — The rise of millennial retail investors and adoption of online trading by Malaysian retail investors are positive trends for retail trading activities, said CGS-CIMB Research.
The research house said that Bursa saw a 125 per cent year-on-year (y-o-y) increase in new central depository system (CDS) account openings in the first seven months of 2020 (7M20).
In a research note today, it said 78 per cent of the new accounts were opened by investors aged 45 years and below, adding that millennials currently make up 36 per cent of total CDS account holders.
Online trading by retail investors also rose to 80 per cent in July 2020 from 50-60 per cent in 2019.
“We view the increasing direct participation by millennials in the equity market and rising adoption of online trading as positive developments that will sustain retail trading activities,” it said.
CGS-CIMB noted that the recent surge in retail investors’ interests could be indirectly due to the Covid-19 pandemic, as many Malaysians had to stay at home following the implementation of the movement control order (MCO).
It said the Malaysian equity market, which remained open during the MCO, had attracted retailers — some of whom were flushed with liquidity from the stimulus — due to the lack of alternative investment products that offer high returns amid a declining interest rate.
The top five traded sectors by retailers in 7M20 were industrial products and services, which account for 21.6 per cent of the total retail traded value, healthcare (19.59 per cent), technology (16.2 per cent), consumer products and services (12.48 per cent), and energy (7.34 per cent).
— Bernama
