"Investors need to take a bigger interest and larger responsibilities for their investments. Brokers and remisiers must value add and expand their roles to become financial planners and advisers to investors.
"The days of punting in the stock market is over. Investors must base investment decisions on valid and timely information. For the brokers and dealers, the herd mentality should stop. It is not prudent to merely follow others. Trading for your clients and managing their portfolio of investments is a serious activity which must be based on sound information and calculated risks," Yusli said, at the Bursa Malaysia - OSK Roadshow this morning (October 3).
"Before investing, investors must first invest time educating themselves about the product they intend to trade. Investors must understand the factors that affect the demand and supply which determines the price of the product.
"Whilst you rely on the word of the broker, it is important you understand the reasoning and logic behind the decisions.
"Bursa LINK, accessible on the Bursa Malaysia website offers investors on-line information on companies listed on the exchange and all company announcements. This is perhaps the most timely of all sources of information.
"Remember that, the higher returns normally goes to the person who knows more about the security and who knows it sooner," Yusli said.
Over 500 participants who attended the day long seminar and workshop, were reminded that before investing, an investment strategy must be developed.
"First, an investor needs a systematic way to select stocks. Then, a timing system to enter and exit the market – that is when to buy and when to sell and thirdly, in managing the portfolio of investments, an investor must decide on asset allocation and diversification.
"We need these strategies because investing is not intuitive. You cannot depend on your intuition or instincts, nor can you rely on emotions in investing, " Yusli said.
Investors were also encouraged to expand on shareholder activism.
"Investors play a significant part in encouraging and ensuring that companies do the right thing, " Yusli said.
Brokers and remisiers were reminded that investments should be under constant review, and continuously managed.
"A dealer or remisier is a professional job and like other professional jobs, it requires continuous education, extensive study, research, reviews and ethical behaviour, " Yusli said.
Yusli also stressed on the importance of maintaining a diversified portfolio of investments in reducing and managing risks. He urged investors and brokers to take advantage of the diversity of stocks and sectors available at Bursa Malaysia.
There are over 930 companies listed on the exchange, consisting of large capitalised companies, medium sized companies, technology and high growth companies. The companies are from 13 different sectors and involved in over 50 different economic activities.
"Clearly, with the diversity available, you can choose to maintain and manage a diversified portfolio of stocks investment.
"Futures trading, which is an effective risk management and price discovery tool can also be used to maintain a diversified portfolio of securities and derivatives investments.
"As investors and brokers, and as public listed companies it is in your hands to change the market - to improve the fundamentals, enhance the investment cycle, increase trading activity and enhance market liquidity, " Yusli said in conclusion.
The Bursa Malaysia -OSK Roadshow which started in April this year was held in 5 other towns. There are 16 more roadshows scheduled in various parts of the country including Sabah and Sarawak until October this year.
