Malaysia is an ideal place for financial growth with its thriving economy and business-friendly atmosphere. This provides investors the opportunity to increase their wealth, making it a great potential marketplace.
It’s important to save money for a rainy day, as life can get difficult in the future. You need to have your financial back-up ready so that you can face any challenges without much hassle.
Saving money helps, but it won’t suffice for long. With inflation rates going up, your savings may not stand the test of time. To keep up with the rising cost of living, investing your earnings is necessary.
If you’re looking for the best way to grow your wealth, we’ve got the right advice. We’ll be showing you 13 of the best investment in Malaysia ideas to help you achieve your financial goals and secure your future by 2023 and beyond.
Disclaimer: All data presented in this article is accurate and up-to-date as of the year 2023.
13 Best Investment in Malaysia To Grow Your Wealth
If you’re wondering where to invest in Malaysia, there are all sorts of investments you can choose from.
These range from low risk investment in Malaysia to the most profitable investment in Malaysia, though it comes with high risk.
Whatever it is, you can be sure each investment will cater for specific types of target audience. Here are 13 of which you can look out for:
Amanah Saham Bumiputera (ASB) and Amanah Saham Malaysia (ASM)
ASB and ASM are both popular investment options for low risk investment Malaysia with attractive dividends. Managed by its main company Amanah Saham Nasional Berhad (ASNB), ASB is meant for bumiputeras while ASM is meant for all Malaysians.
ASB and ASM can be accessed through various platforms such as Maybank and CIMB, making it convenient for investors. Plus, there are no sales or redemption charges and the dividends are distributed annually.
These are subject to changes based on the fund’s performance, and even though it has been on the decline in recent years, you can be sure your returns will always never be negative.
Risk: Low
Returns: 4.25% and above per annum
Tabung Haji
Tabung Haji, also known as the Pilgrims’ Fund Board, is a unique investment opportunity in Malaysia specifically tailored for Muslims who intend to perform Hajj (pilgrimage to Mecca) or Umrah.
It operates as a savings institution and investment fund, aiming to help Muslims save and invest for their pilgrimage expenses. Tabung Haji offers a Shariah-compliant platform, adhering to Islamic principles in its investment activities.
This is truly one of the many low risk investments you can consider as not only are you guaranteed returns by the government, this investment is exempted from taxes and has no fixed deposit amount limit.
Risk: Low
Returns: Currently around 3% – 4%
Employees Provident Fund (EPF)
EPF is a government-backed retirement savings scheme in Malaysia that offers attractive dividends and allows individuals to save for their retirement.
Through this, both employees and employers contribute a portion of their salaries to the EPF, with the minimum contribution being at 11% of the employee’s monthly salary.
However, you have the option to increase this by either making an additional self-contribution to your EPF account for further investment or raising the mandatory 11% contribution rate, though you will need to contact your company’s human resources department for details.
Thanks to this, EPF offers low risk investments that’s also reliable in the long term due to its steady returns. However, the funds are locked until retirement, limiting liquidity.
You can, however, take out a certain amount to help make major payments such as a house or medical treatments.
Risk: Low
Returns: 2.5% (for non-conventional accounts) and above per annum
Private Retirement Schemes (PRS)
The PRS is designed to supplement your EPF or savings account, offering you more flexibility in retirement planning. It is managed by a private fund manager and provides a range of investment options.
The investment amount varies depending on the fund selected, with some offering a minimum investment of RM100. PRS offers potential returns through various investment strategies, including equity and fixed income.
However, it’s important to assess the risk profile of each PRS fund before investing, as your investment returns aren’t always guaranteed.
Take note that just like EPF, you will not be able to take out the investment money you earned easily, and will have to pay an 8% tax penalty should you decide to do so.
On the bright side, you can save money in other areas such as income tax as you can claim tax relief of up to RM3000 when you invest in PRS!
Risk: Low to Medium
Returns: As high as 4.3% per annum in the year 2023 though it depends on the PRS Fund
Unit Trust Funds
Unit Trust Funds are a type of collective investment that pool the funds of many different participants to invest in a variety of assets and portfolios, including stocks, bonds, as well as commodities.
Unit trust funds provide an opportunity for investors to invest their money under the guidance of professional fund managers. These managers make informed investment decisions and help create maximum returns with minimum risk.
The minimum investment amount varies depending on the fund and can range from RM100 to a few thousand ringgit, which makes it highly accessible if you can only start small. Plus, Unit Trust Funds offers you the opportunity to access various markets and sectors.
Related: Marketplace in Malaysia
However, it’s essential to carefully review the historical performance of the unit trust, fees, and risk factors before making an investment. Sometimes, there are also sales charges of up to 5% to look out for, on top of other fees such as platform, management, trustee fees, and more.
You can opt for online platforms to gain lower charges, but this all means that, if not careful, these fees could easily eat into any money you gained through investments. Worse still, it could put you in the negative.
Risk: Anywhere from low to high due to its diverse portfolio
Returns: Highly dependent on your portfolio and funds
Exchange Traded Funds (ETFs)
ETFs are similar to unit trust funds, as ETFs are investment funds traded on the stock exchange that aim to track the performance of an underlying index, commodity, or sector.
ETFs offer diversification and flexibility to investors, as they can be purchased in the same way as stocks, with a minimum investment depending on the market price of the ETF.
Dividends are typically distributed according to the underlying assets of the ETF Malaysia. ETFs provide a cost-effective way to gain exposure to different markets and sectors.
There’s no fund managers, which makes it safe and ideal for beginners. However, you will need to consider the liquidity, expense ratios, and tracking accuracy of the ETFs before investing.
Risk: Anywhere from low to high due to its diverse portfolio
Returns: Highly dependent on your portfolio and funds
Real Estate Investment Trusts (REITs)
REITs are the best type of investments if you want to invest in real estate without directly owning the property. These can include income-generating properties such as commercial buildings, shopping malls, and hotels.
You can purchase REIT units on the stock exchange, which means they’re highly accessible, though the minimum investment depends on the market price of the REIT unit. REITs generate income through rental returns and capital appreciation.
Dividends can be pretty high through REITs and are distributed regularly, typically on a quarterly or semi-annual basis.
While REITs offer the potential for steady income and diversification, it’s crucial to consider the underlying properties and management expertise before investing, as this is key to ensuring high returns in the long run.
Risk: Medium
Returns: As high as 4% or more per share in annum for the high performing REITs
Blue Chip Stocks
Blue chip stocks refer to shares of large, well-established companies with a track record of stable performance. These stocks are often considered less volatile and provide consistent dividends.
As an investor, you can buy blue chip stocks through brokerage accounts, with the minimum investment depending on the stock price. Dividends are usually paid on a regular basis, depending on the company’s dividend policy.
When it comes to investing in blue chip stocks, you can be sure they offer the potential for capital appreciation and long-term returns.
However, it’s important to conduct thorough research and consider the company’s financial health, industry trends, and market conditions before investing.
Plus, there’s high investment costs due to transaction fees and even brokerage fees, which means you’ll lose out more especially if you’re aiming for small, short-term transactions.
Risk: Medium to High
Returns: Dependent on the current market and the company
Cryptocurrency
Even if you’re not an investor, you would have definitely heard about the rise of cryptocurrency and how it gained in popularity as a form of investment.
Cryptocurrency, such as Bitcoin and Ethereum, is a digital investment asset that involves buying and holding digital coins with the expectation of capital appreciation.
The investment amount depends on the cryptocurrency and can range from a few dollars to thousands of dollars or ringgit.
However, cryptocurrency investments are highly volatile and speculative, carrying substantial risk. The potential returns can be significant, as it’s been reported that the Bitcoin (^BTC) Commodity once gained a 73.32% compound annual return in the last 10 years.
But in order to fully take advantage of it, you will need to understand the technology, market trends, and regulatory environment associated with cryptocurrencies before you start investing.
Risk: High
Returns: Depends on the cryptocurrency
Equity Crowdfunding
Equity crowdfunding enables you to invest in early-stage startups or small businesses in exchange for equity ownership. Platforms like Ethis (for Shariah-compliant) and pitchIN allow investors to support promising ventures with varying minimum investment requirements.
This means you have a chance to invest in startups or companies that are still in their early stages, which means returns on equity crowdfunding investments are tied to their success in becoming the best business in Malaysia.
While equity crowdfunding offers the potential for high returns thanks to this, it also carries high risks due to the nature of early-stage businesses.
In order to gain high returns, you will need to carefully evaluate the business model, market potential, and management team before investing.
Risk: High
Returns: Dependent on the business and their success
P2P Lending/Debt-Based Crowdfunding
P2P is a form of crowdfunding that uses lending platforms like Fundaztic and Funding Societies to give you the opportunity to lend money directly to borrowers and earn interest. As long as the loan is in effect, you’ll gain interest.
The minimum investment for some of these can start as low as RM50, which makes it highly accessible especially for beginners.
P2P lending offers potential returns through interest payments, some as high as around 10% per annum, and you can always diversify your investments across multiple borrowers to manage risk.
However, default risk is a concern, and investors should thoroughly assess the creditworthiness of borrowers and understand the platform’s risk mitigation measures before participating.
Risk: High
Returns: Depends on the P2P Platform and whether the borrowers default
Robo Advisor
If you find the idea of investment in general as too confusing, and prefer a more automated way of investing, then this is for you. Robo advisors, such as StashAway and MyTheo, offer automated investment management services using algorithms.
These robo advisors provide diversified portfolios based on the investor’s risk profile and investment goals. The platform manages the investments and rebalances the portfolio as needed.
You can open an account with a minimum investment as low as RM100, and they provide plenty of convenience and cost-efficiency. However, make sure to review the fees, investment strategy, and performance track record of the robo advisor of choice before committing to it.
Risk: Low to High
Returns: Depends on the platform you use and the portfolio you invest in
Bonds
Bonds are a form of fixed-income securities that represent a loan made by an investor to the issuer, typically provided by governments or corporations.
Bonds offer regular interest payments and the return of principal upon maturity. The minimum investment amount varies depending on the bond, and they can be purchased through brokers or financial institutions.
Bonds are considered less risky compared to stocks but offer lower potential returns.
For example, the Malaysia 10 Years Government Bond yielded 3.9% – which is why before investing, it’s crucial to evaluate the creditworthiness of the issuer, the bond’s duration, and prevailing interest rates.
Risk: Low
Returns: Commonly below 4% if provided by government
Factors to Consider Before Investing
Before diving into any investment, it’s important to take note of several key factors that can significantly impact your investment journey.
To make the best investment plan in Malaysia, you need to consider these factors as it will help you make informed decisions and align your investment with your financial goals.
Risk Tolerance
Risk tolerance and knowing how much you’re willing to tolerate is very important as different investments carry varying degrees of risk. It’s crucial to evaluate your comfort level with market fluctuations and potential losses.
If you’re a conservative investor who doesn’t want to risk high losses, you may opt for lower-risk investments with more stable returns. If you’re an aggressive investor, it means you may be willing to take on higher risk for the potential of greater rewards.
Investment Horizon
The amount of time you expect to hold your investments before you need to withdraw the money is referred to as your investment horizon.
It can vary based on your financial goals, such as short-term goals (less than five years), medium-term goals (five to ten years), or long-term goals (over ten years).
Short-term goals may prioritise liquidity and stability, while long-term goals can accommodate more volatile investments that offer higher potential returns.
Financial Goals
Clearly defining your financial goals is important if you’re aiming for effective investment planning.
Whether you aim to save for retirement, purchase a home, fund your children’s education, or achieve financial independence, your investment objectives will influence your investment strategy.
Each goal may have a different time frame and the risk you’re willing to take, requiring a tailored approach.
Market Conditions
Market conditions should also be considered as it plays a significant role in investment performance. Economic indicators such as geopolitical events and industry trends can impact the performance of various investment options.
To check on this, conduct research, follow financial news, and consult with financial advisors to gain insights into market trends.
While it’s impossible to predict market movements with certainty, awareness of market conditions can help you make more informed investment decisions and adjust your portfolio accordingly.
FAQs on How To Invest in Malaysia
Where Should I Invest My Money to Get Good Returns in Malaysia?
There are several investment options in Malaysia that can potentially provide good returns. Consider diversifying your investments across different asset classes such as stocks, bonds, mutual funds, and real estate.
Blue chip stocks and diversified unit trust funds are popular choices for long-term growth. Real estate investment trusts (REITs) can offer both income and capital appreciation.
It’s essential to conduct thorough research, assess your risk tolerance, and consider professional advice to make an informed and good investment in Malaysia.
Which Investment Has the Highest Return in Malaysia?
The most profitable investments in Malaysia often come with high risks. Generally, investments like equities (stocks) and certain high-growth sectors or individual stocks can offer the potential for higher returns over the long term.
However, it’s important to note that past performance is not indicative of future results. It’s best to carefully evaluate the risk associated with each investment option and diversify your portfolio to manage risk while seeking higher returns.
What is the Best Short Term Investment in Malaysia?
For short term investment Malaysia, there are options such as fixed deposits, money market funds, or short term bond funds which can provide relatively stable returns over a shorter duration.
These investments typically offer lower risk and quick access to funds when needed. However, the returns are lower compared to longer-term investments.
What to Invest With RM100k in Malaysia?
It depends on your investment objectives. With RM100,000, the best suggestion is to diversify your portfolio. You could allocate a portion of the funds to blue chip stocks, diversified unit trust funds, or exchange-traded funds (ETFs) if you aim to potentially achieve long-term growth.
Additionally, investing in a mix of fixed income securities such as bonds or bond funds can provide stable income. In the end, the allocation money market fund should be based on your risk tolerance, investment horizon, and financial goals.
Which Bank is Best for Investment in Malaysia?
Several banks in Malaysia offer investment services, and the “best” bank for investment depends on your specific requirements and preferences.
Some renowned banks in Malaysia with investment offerings include Maybank, CIMB, Public Bank, and RHB Bank. To choose, consider factors such as the range of investment products and services, fees and charges, customer service, and convenience of online platforms.
Invest for the Future, Secure your Present
There’s no doubt that investing your savings is key to a financially secure future. If you’re keen to invest but find your savings account and financial returns aren’t high enough for it, why not start a small business?
Entrepreneurship is a great way to gain additional avenues that can lead to passive income Malaysia. Plus you can start one easily with this guide to starting an e-commerce business.
However, to effectively promote your business and reach your target audience, you’re going to need to start online.
If you need help in this area, One Search Pro is here! Our experienced team can assist you in developing an effective online presence – from optimising your website to implementing digital marketing strategies that will surely enhance your business growth and profit.
Contact us and invest in your business today to gain guaranteed returns in the future!
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