Your Investment Knowledge Base

The total value of a company as the stock market sees it. Calculated by multiplying the share price by the total number of shares. Example: if a company has 1 billion shares at RM2 each, its market cap is RM2 billion. Bigger market cap generally means a more established company.

PE (Price-to-Earnings) tells you how many years it would take for the company to earn back what you paid for the share, based on current profits. A PE of 10x means you are paying RM10 for every RM1 of earnings.

Forward PE uses the estimated future earnings instead of past earnings. It is more useful because markets are forward-looking. If a company is expected to grow profits significantly, the forward PE will be lower than the trailing PE, which makes it look cheaper.

Earnings Per Share. The company's total profit divided by the number of shares. If a company earns RM100 million and has 500 million shares, the EPS is 20 sen. Higher EPS generally means the company is more profitable per share. Watch out for diluted EPS, which accounts for warrants and convertible bonds that could increase the share count.

How much cash a company pays you every year as a percentage of the share price. If a stock costs RM2 and pays 10 sen dividend per year, the dividend yield is 5%. A higher yield is attractive, but always check if the company can sustain it. A very high yield sometimes signals the share price has dropped for a reason.

Profit After Tax. The company's bottom-line profit after all expenses, interest, and taxes have been deducted. This is the number most people refer to when they say a company 'made RM50 million in profit.' It is the clearest measure of how much the company actually earned.

YoY (Year-on-Year): comparing this quarter or year to the same period last year. Useful because it removes seasonal effects. If Q2 2025 profit is compared to Q2 2024, that is YoY.

QoQ (Quarter-on-Quarter): comparing this quarter to the previous quarter. Useful for spotting short-term momentum, but can be misleading for seasonal businesses.

Unusual Market Activity. When a stock's price or volume moves sharply without an obvious reason, the stock exchange issues a UMA query, asking the company to explain. The company must respond publicly. A UMA is sometimes a warning sign of speculation or insider activity. Always check what the company says in its UMA response before reacting.

The maximum a stock is allowed to move in a single trading day. On Bursa Malaysia, a stock can move up or down by a maximum of 30% in one day. If it hits the upper limit, it is limit up (涨停). If it hits the lower limit, it is limit down (跌停). Trading may continue at that price but cannot go beyond it.

The cut-off date to be eligible for a dividend or corporate exercise. If you buy shares on or after the ex-date, you will NOT receive the upcoming dividend. You must own the shares before the ex-date. On the ex-date itself, the share price typically drops by roughly the dividend amount because new buyers are no longer entitled to it.

Not the same as a regular bank. An investment bank advises companies on big financial decisions, like getting listed on the stock exchange, buying or selling other companies, or raising money from investors. They do not take deposits from the public. In Malaysia, examples include Maybank IB, CIMB, RHB IB, and AmInvestment Bank. The BursaNews founders worked in investment banking.

A Memorandum of Understanding. A non-binding agreement between two parties that says they intend to work together or do a deal. It is essentially a handshake on paper. An MOU does not guarantee anything will happen. Many companies announce MOUs to positive market reaction, but MOUs frequently expire or fall through. Always wait for a definitive agreement before getting too excited.

When a private company sells its shares to the public for the first time and gets listed on the stock exchange. It is how companies raise money from public investors. Once listed, anyone can buy and sell the shares freely. IPO shares are often oversubscribed, meaning more people apply than there are shares available, so allocation is done by ballot.

Got an IPO Pink Form from your employer? Read IPO Pink Form Malaysia. Applying as the public? See our Bursa IPO guide. You will need a CDS account first.

When a listed company raises money by offering existing shareholders new shares at a discounted price. As a shareholder, you have 3 choices: (1) Subscribe, buy the new shares at the discounted price. (2) Sell your rights entitlement to another investor. (3) Do nothing, let the rights lapse. If you do nothing, your shareholding percentage gets diluted because more shares are now in circulation.

Next: Rights issue explained: subscribe or sell?

When a listed company issues new shares directly to selected investors, usually institutions or high-net-worth individuals, without offering them to the general public. It is a faster way to raise money than a rights issue. The downside for existing shareholders is dilution. The price is usually at a small discount to the market price.

Free extra shares given to existing shareholders in proportion to their holdings. For example, a 1-for-2 bonus issue means for every 2 shares you own, you get 1 free extra share. The total value stays roughly the same because the share price adjusts down proportionally. It is not free money, but it makes the share price lower and more accessible, which can improve liquidity.

The Central Depository System account where your Bursa Malaysia securities are recorded electronically. You open it through a stockbroker or the Bursa Anywhere app. Some brokers give you a CDS account in your own name, others hold shares through a nominee account.

Next: How to open a CDS account in Malaysia

Your account with a licensed stockbroker that lets you place buy and sell orders. It works together with your CDS account: the trading account places the order, the CDS account holds the shares.

Next: How to open a trading account

The fee your broker charges for executing a trade. On top of brokerage, every Bursa trade also pays a clearing fee to Bursa Malaysia and stamp duty to the government, which are the same whichever broker you use. Brokerage is where brokers differ most.

Next: Compare Malaysian brokers

The application form an IPO company gives its Eligible Persons, usually directors and employees, so they can apply for shares reserved for them. You will usually need a CDS account in your own name, and must follow the instructions in the prospectus.

Next: IPO Pink Form Malaysia: what you need to know