For a long time, Malaysia has been known as a country where forex trading was not popular. In fact, 40% of government revenue comes from imports and exports of different commodities, but more popularly, oil. However, there are still amazing facts that will get your attention concerning forex trading in the country.
Forex Trading in Malaysia
First and foremost, forex trading in Malaysia is legal as long as one uses an approved and registered financial institution. Before its legalisation, not many people were confident about how the concept worked. Even after the government allowed people to participate in forex trades, you could still see some hesitation, such as the decision to start forex trading by the Bank Negara without Dr Mahathir Mohamed’s awareness, as later revealed in 2017.
However, the nation has slowly gained its confidence in forex trading, although tight laws have been placed to reduce federal concerns. One can now easily invest overseas, and retail forex trading can also be considered as foreign investment in many cases.
Limitations of Malaysian Forex Trade
One of the biggest limitations to forex trading in Malaysia is the country’s need to run its own currency. With a huge per cent of the forex trading in the nation not involving the local currency, a lot of ways of trading have been overlooked. Basically, trading laws are written in a way that the government can manipulate the system as they see fit.
One of the things that are forbidden in forex trading by the Malaysian government is trading with others’ funds or soliciting funds for trading. With very few people knowing these laws by heart, it easy for one to go against them and not even know it. This can continue as long as the government does not find out. However, when you get caught, the penalties could lead to hefty fines.