Why Direct Stock Investing in Malaysia | Benefits & Guide | Maher Saham

Direct stock investing means you personally choose which stocks to invest in, as opposed to investing in funds managed by fund managers.

You then buy the shares yourself and, depending on your trading plan, sell them once they reach a certain price – whether up or down.

Full Control

In unit trusts, the fund manager decides when to buy or sell specific stocks. Investors cannot simply say, "I only want to buy Maybank shares."

Direct Investors: Have full authority to choose companies they believe in, understand the business model of, and are comfortable with the direction of. This freedom is uniquely satisfying, especially when your own analysis bears fruit.

Cost Efficiency (No Annual Management Fees)

Unit trust funds typically charge an annual management fee (around 1.5% to 2%) as well as a sales charge.

Direct Investors: Only pay transaction costs (brokerage, stamp duty, and settlement fee) each time they buy or sell. If they hold shares for the long term (buy and hold), the long-term costs are usually far lower compared to paying management fees every year regardless of profit or loss.

Multi-Bagger Return Potential

Unit trust funds are designed to be diversified to reduce risk. As a result, a sudden surge in one or two stocks within the portfolio will not cause the overall fund value to jump 100% overnight.

Direct Investors: If they manage to find a "hidden gem" (an undervalued stock or a company poised to take off), they stand to gain extraordinary returns (for example 200%-300%) that are difficult to achieve through large, conservative funds.

Custom Dividend Strategy

Many investors choose direct stock investing because they want cash flow from dividends on their own schedule.

Direct Investors: Can build a portfolio of companies that pay dividends in different months. They also benefit fully from Dividend Reinvestment Plans (DRP) or bonus share issuances directly into their CDS account.

Speed of Action (Agility)

The stock market is highly dynamic. Major news can move prices within minutes.

Unit Trust / Amanah Saham: Transactions typically use the day''s closing price (Forward Pricing). You cannot "time" the market at 11 AM.
Direct Investors: Can buy or sell immediately at the current price (Live Pricing). If bad news breaks, they can exit the market straight away without waiting for fund administration processes.

Interest, Knowledge, and Intellectual Satisfaction

For some people, stock investing is a hobby and a continuous learning process.

Reading annual reports, analysing technical charts, and following economic developments provides intellectual satisfaction. For this group, handing money over to a fund manager feels "boring" because they lose the opportunity to sharpen their own analytical skills.

Getting Started with Direct Investing

Direct stock investing gives you full control over your portfolio. This is the first step towards financial freedom.

Open an Account:

To invest directly, you need a CDS account. Open a CDS account and start building your portfolio.

Understand the Basics:

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