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Discretionary Trading—What is it Exactly?

If you want to start trading but don't have time to do research, then this is an option for you.

Discretionary Trading is a personalised investment service that allows a broker to run your trading strategies on your behalf. By specifying your investment goals and investment styles through a set of agreed guidelines, your broker will be able to use their discretion to make investment decisions for you, thus allowing you to enjoy peace of mind and focus on other priorities.

How It Can Benefit You

Convenience with Your Best Interests at Heart

With this hands-off approach, your broker can effectively manage your trading strategies within the mandate of the mutually agreed investment management agreement.

Personalised Investment Service

Invest more confidently with a broker that can keep you up-to-date with market trends and make informed investment decisions on your behalf.

Cost Efficiency

Discretionary Trading allows for more flexibility with a variety of service fee models, depending on the broker's product offering.

Conventional
Discretionary Trading

Through conventional Discretionary Trading, you can work together with an approved Participating Organisations (PO) to set your investment goals based on the specified investment policies. This service includes the execution of buy and sell orders and administration of the clients' account.

Shariah
Discretionary Trading

Discretionary Trading may also be conducted in accordance with Shariah principles through the services offered by approved Islamic PO. This way, you too, can benefit from tailored and Shariah-compliant equity portfolio management services.

Personalise Your Investment Goals

Set a prior agreement with an authorised broker on the type of investment decisions they can make on your behalf. This way, you can take control of your managed account without having to monitor it 24/7 while your appointed broker takes care of the rest.

Discretionary Trading Framework

Fee Models

1

Fee models for Discretionary Trading may be based on profit sharing or value of assets under management, depending on the Participating Organisations' product offering.

Dealer's Representative
(DR) Eligibility

2

The Dealer's Representative operating a Discretionary Account in the approved Participating Organisations would have satisfied prescribed criteria on experience in fund management or dealing in securities.

1

Fee Models

Fee models for Discretionary Trading may be based on profit sharing or value of assets under management, depending on the Participating Organisations' product offering.

2

Dealer's Representative
(DR) Eligibility

The Dealer's Representative operating a Discretionary Account in the approved Participating Organisations would have satisfied prescribed criteria on experience in fund management or dealing in securities.

Equip Yourself with the Right Knowledge on Discretionary Trading

What are Shariah Discretionary Trading Services?

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Got Questions About
Discretionary Trading?

FAQs

What is Discretionary Trading ("DT")?
DT is a service provided by a Participating Organisation ("PO") for its client (investor) where investment goals are set with the investor based on the specified investment policies e.g. investment objective, risk tolerance. This service includes the execution of buy and sell orders and administration of the investor's account.
What is Shariah DT?
Shariah DT refers to an investment approach in which investment decisions are made by a portfolio manager in accordance with Shariah principles, but within scope of the DT framework and guidelines. It involves the active management of a portfolio of Shariahcompliant securities based on the portfolio manager's expertise and discretion.
What is the purpose of DT and Shariah DT?

DT and Shariah DT aims to grow investors' investment portfolio and wealth via a tailored and structured discretionary equity portfolio.

Shariah DT provides access for investors to invest in Shariah-compliant investment instruments via a tailored, structured and Shariah-compliant discretionary equity portfolio.

What are the requirements to participate in DT and Shariah DT?
  1. Investors are required to open a Discretionary Account ("DA"), separate from normal trading account. For Shariah DT, investors are required to have a separate Shariah DA;
  2. Investors must make a cash transfer; and
  3. Investors must not transfer existing securities in their holding or other types of collateral as capital.
Who can participate in DT and Shariah DT?
All types of investors are allowed to participate in DT and Shariah DT
Can non-Muslim participate in Shariah DT?

Yes, Shariah DT is not limited to Muslims. Non-Muslim investors who are interested in socially responsible investing or are aligning their investments with ethical principles may also participate in Shariah DT.

How to participate in DT and Shariah DT?

Investors may contact the respective POs offering DT and Shariah DT to schedule an appointment to make the relevant arrangements for participating in DT and Shariah DT.

Kindly refer to the list of POs that offer DT and Shariah DT on our website.

(Refer to: https://www.bursamalaysia.com/trade/our_products_services/discretionary_trading/list_of_participating_brokers)

Is there any minimum capital requirement to participate in DT and Shariah DT?

Each DT and Shariah DT structure offered by the respective POs may differ; hence, the minimum capital set may vary from one PO to another. Investors are advised to check with the respective POs’ DT and Shariah DT structure to further understand the product features.

What are the fees charged for DT and Shariah DT?

Investors are advised to check with the respective POs offering DT and Shariah DT services as fees charged may vary from one PO to another.

Is there any risk associated with DT and Shariah DT?

Like any form of investments, the risk of DT and Shariah DT may vary based on specific investment strategies and market conditions. Examples of market conditions include movements in interest rates, exchange rates, commodity prices as well as geo-political updates.

What are the advantages of participating in DT and Shariah DT?

The advantages include access to professional investment management and diversification across different asset classes.

For Shariah DT, investors are able to invest in accordance with Shariah principles and socially responsible investment practices.

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