Rakuten to offer contra trading and margin financing
KUALA LUMPUR: Online trading platform operator Rakuten Trade Sdn Bhd is looking to boost market share by offering contra trading and margin financing just over five months since becoming Malaysia’s first fully online trading platform.
The company plans to offer contra trading by the end of the year, and margin financing from early next year.
At the moment, Rakuten Trade’s online platform or mobile app called iSPEED.my operates purely on a “cash upfront” basis, whereby users must first transfer cash into the account to begin trading.
In contra trading, the trader does not pay for the full cost of the shares. Instead, the trader pays for the loss or receives the profit from the trade.
Rakuten Trade managing director Kaoru Arai told StarBiz that the details of the offerings have not been finalised, but promised “competitive rates” for margin financing.
The company, a joint venture between Kenanga Investment Bank Bhd and Japan’s Rakuten Securities Inc, was the country’s first brokerage to gain approval from the Securities Commission (SC) for straight-through processing to Bursa Malaysia.
The launch of the fully online trading platform, or the iSPEED.my mobile application, disrupted the local trading scene in May which was the first to allow new investors to set up their central depository system accounts online, and begin trading within two hours.
The platform has close to 5,000 trading accounts, with 70% of the users below the age of 40, and 30% of them beginners or non-traders.
“The response from Malaysians has been better than expected, and the number of new accounts is rising, especially over the past two months.
“Our challenge moving forward, is to further increase brand awareness and establish trust towards our trading platform,” he said.
As a financial technology firm, Arai said Rakuten has been involved in organising fintech conferences in Japan over the past three years.
This year, Rakuten Trade will be collaborating with the SC on the two-day annual public conference on Digital Finance, SCxSC 2017, to be held at the Sime Darby Convention Centre from Nov 6.
As organiser of the Rakuten Fintech Track session, the company will be bringing in international speakers to discuss the latest disruptive innovations in areas including gamification, payments and lending.