One way to diversify investments is by investing abroad to gain exposure to major markets such as the US and Japan. Malaysian investors can easily access global markets through online trading platforms, which offer affordable fees.
Those already investing globally might be familiar with Interactive Brokers (IBKR) , a Nasdaq-listed online trading platform with over 40 years of establishment.
IBKR allows investors to access over 150 global markets with brokerage fees as low as USD 0.001 on US stocks and ETFs. Additionally, investors can earn returns of up to 4.83% on USD cash in their IBKR accounts, which are available for withdrawal at any time for trading.
Opening An Account & Buying Stocks With Interactive Broker (IBKR)
To begin trading with IBKR, you must open an account. There are two main types: a cash account, which uses your existing funds for trades, and a margin account, where the brokerage lends you money against your securities as collateral.
Funding Your IBKR Account
Before trading, you need to fund your account. Notably, IBKR is not registered in Malaysia, and the Malaysian ringgit is not supported on the platform. From Malaysia, you can fund your account through several methods:
Bank Transfer: You can transfer funds using a CIMB Singapore bank account, which can be opened online. Remember, currency conversion fees are typically charged by the bank.
Instarem: This cross-border payment service supports ACH direct debit payments, usually a cheaper option.
Wise Transfer: Funds can be converted into a supported currency and deposited into your IBKR account through a Wise multicurrency account.
Placing Orders
Once your account is funded, you can place orders to buy or sell shares. There are two main types of orders:
Market Order: Buys or sells shares at the current market price, which may vary from the displayed price.
Limit Order: Sets a maximum purchase price or a minimum selling price to better control trading costs.
Access To Over 150 Global Markets
In Malaysia, trading platforms typically give investors access to major markets such as the US, Hong Kong, Singapore and China. This is of course on top of our own Bursa Malaysia. For those looking to further diversify their portfolios, Interactive Brokers (IBKR) offers an option. IBKR provides access to a wide range of assets including stocks, options, futures, currencies, bonds, and funds across over 150 markets, including European countries, all on one platform. Additionally, IBKR features pre-built portfolios for investment.
Investors can also purchase fractional shares through IBKR, enabling ownership of a portion of a share. This is particularly advantageous for trading in high-priced stocks without the necessity of buying a whole share. However, it’s important to note that IBKR is not a participating organisation of the Bursa Malaysia exchange, so investors cannot trade the local market using IBKR.
Low Brokerage Fees
As the Malaysian ringgit weakens against the US dollar, some investors may consider global investments to potentially earn better returns. Holding investments in US dollars could help keep pace with the strengthening US currency.
For those interested in US stocks and ETFs, Interactive Brokers (IBKR) offers competitively low brokerage fees, which can help maximise returns. Specifically, IBKR charges a brokerage fee of USD 0.005 per share with a minimum fee of USD 1.00 on US stocks and ETFs. Additionally, tiered pricing applies for those trading over 300,000 shares per month.
Commission Rates For US Stocks And ETFs
| Monthly Volume (Shares) | Fixed (USD) | Tiered (USD) |
| ≤ 300,000 | USD 0.005 | USD 0.0035 |
| 300,001 – 3,000,000 | USD 0.0020 | |
| 3,000,001 – 20,000,000 | USD 0.0015 | |
| 20,000,001 – 100,000,000 | USD 0.0010 | |
| > 100,000,000 | USD 0.0005 | |
| Minimum per order (shares) | USD 1.00 | USD 0.35 |
Enjoy Free Access To News, Research And Trading Tools Through IBKR
IBKR offers its investors a range of free trading tools and educational resources to enhance their trading skills. This includes access to more than 100 types of orders and free algorithmic trading options that help execute investment strategies effectively.
Additionally, IBKR provides insightful research resources, such as the Billionaires’ Portfolio, which features a selection of 20 stocks owned by billionaires. Investors also have access to the latest regional news from several vendors in real-time.
For more interactive learning, IBKR hosts free live trading webinars led by experts from the financial services and research sectors. These sessions allow investors to ask questions and refine their trading strategies.
Under the ‘Trader’s Academy’ section on the IBKR website, online courses are available for investors at all levels—from beginners to experienced traders. These courses, which utilise IBKR’s award-winning trading tools, include comprehensive notes and quizzes to ensure a thorough understanding of the material.
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