How to Invest In US Stocks In Malaysia

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To invest in US stocks from Malaysia, follow these steps:

Choose a reliable broker. Pick an international or local broker offering access to US stock markets.
Open a trading account. Provide identification, proof of address, and complete forms like the W-8BEN for foreign investor status.
Fund your account. Deposit funds in USD to avoid conversion fees. Check exchange rates and transaction costs.
Select and buy stocks. Research US companies and use the broker’s platform. Fractional shares are available for high-value stocks.
Monitor your portfolio. Track performance and adjust your strategy based on market trends.

The New York Stock Exchange and the NASDAQ are two of the biggest and most well-known stock exchanges in the world, and they can both be excellent ways to gradually increase your wealth.

Investing in foreign equity may be advantageous for Malaysian investors. Among other things, it will diversify your investment portfolio and help you control currency fluctuations. Therefore, US stocks can be a great way to diversify and grow an investment portfolio in Malaysia, whether you're an experienced investor or just getting started. How to invest in them in Malaysia is explained in this article.

How to buy US stocks in Malaysia?

Yes, as a Malaysian investor, you can invest in U.S. stocks. This opportunity allows you to diversify your portfolio and gain exposure to some of the world's largest companies. Here's how you can get started.

Choose a brokerage platform

International brokers provide access to U.S. stock markets for global users.
Local brokers with international access offer trading in foreign markets, including the U.S.

As a new trader, you need to choose the right online stock trading platforms or brokers to work with. Using the wrong broker could make a big dent in your investment returns. Thus, having a good broker will help you in your investment journey. Below is a list of the best stock brokerage firms and their fee structures for online stock trading in Malaysia.

Best brokers to buy U.S stocks in Malaysia in 2025
	Basic stock/ETF fee	Min. stock/ETF fee	Inactivity fee	Withdrawal fee	Open an account
eOption	$3 per trade	$3 per trade	$50	$25 for wire transfers out	Open an account Via eOption's secure website.
Wealthsimple	Zero Fees	Zero Fees	No inactivity fees	No charge	Open an account Via Wealthsimple's secure website.
Revolut	Standard, Plus, Premium, and Metal Plans: 0.25% of the order amount. Ultra Plan: 0.12% of the order amount.	£1.00 in the UK, €1.00 in the Eurozone	Not specified	No charge up to a limit	Study review
Interactive Brokers	0-0,0035%	$1,00			Open an account Your capital is at risk.
SoFi Invest	Zero Fees	Zero Fees	$25	$25 for wire transfers out	Study review

Open a trading account

Documentation such as identification (passport or IC) and proof of address will be required.
Tax forms like the W-8BEN form are needed to declare foreign investor status for U.S. tax purposes.

Fund your account

Deposits will need to be converted to U.S. dollars.
Pay attention to exchange rates and fees associated with currency conversion.

Start investing - select and buy stocks

Research U.S. stock markets, including the NYSE and NASDAQ.
Be mindful of the time zone difference when trading.

Monitor your portfolio

Monitor your portfolio regularly to stay informed about its performance and to identify any underperforming assets or opportunities for improvement. Evaluate how well each asset aligns with your overall financial goals and risk tolerance, and compare actual returns against expected benchmarks. If certain investments consistently fail to meet expectations, consider reallocating funds or diversifying into other sectors.

Considerations:

Fees and commissions vary among brokers. Understand the cost structure before proceeding.
Regulatory compliance ensures the broker is authorized and reliable.
Currency risk arises from fluctuations between the Malaysian Ringgit (MYR) and U.S. Dollar (USD), affecting investment returns.

How to invest in U.S. stocks with an international stock broker?

An international stock broker enables Malaysian investors to access global markets, including the U.S., providing opportunities to diversify and trade in some of the world's largest companies. By using such brokers, you can directly open accounts with foreign brokerage firms operating in Malaysia or those that cater to international investors. This approach is particularly suitable for Malaysians seeking seamless access to the U.S. stock market.

When selecting an international broker, prioritize essential features like a strong industry reputation, robust security standards, responsive customer service, and access to a wide range of stocks and markets (U.S., EU, UK). Look for brokers offering affordable fees, advanced trading tools, and educational resources to support informed decision-making. Be aware of all costs, such as trading fees, currency conversion, and potential withdrawal charges, before opening an account. Conduct thorough research to identify a broker that aligns with your investment goals and trading needs.

Broader market access. Investors gain entry to diverse markets, including the U.S., EU, and UK.
Lower trading fees. Many international brokers offer competitive pricing compared to local brokers.
No capital gains tax. Malaysian investors are exempt from capital gains tax on profits from U.S. stock sales.

Limited local regulation. These brokers may not be governed by Malaysian regulatory bodies, potentially posing higher risks.
Dividend withholding tax. U.S. dividends are subject to a 30% tax for international investors.
Higher risks. Currency fluctuations and reliance on foreign platforms may increase exposure to risk.

How to invest in U.S. stocks with local brokers?

Many domestic Malaysian stockbrokers have connections to US stock brokers. They carry out your trades and serve as an intermediary. Any such broker will allow you to set up an international trading account. You might have to submit a set of documents to open this account.

You might, however, be subject to limitations on the types of investment vehicles you can use or the total number of trades you can execute, depending on the brokerage firm. When brokerage fees and currency conversion costs are taken into account, investing can be expensive. Therefore, before opening an account, make sure you are aware of all the costs.

Regulation. Local brokers are regulated by Malaysian authorities, providing investors with legal protection and recourse.
No capital gains tax. Malaysian investors are exempt from paying taxes on profits earned through U.S. stock investments.
Lower risk. Familiarity with local systems and support ensures a more secure investment experience.

High brokerage fees. Transactions through local brokers often come with elevated fees compared to international brokers.
Limited stock access. Investment options may be narrower, restricting the variety of U.S. stocks available.
Currency restrictions. Some brokers may not allow trading in multiple foreign currencies, limiting diversification options.

Rules and regulations in Malaysia

Before venturing into U.S. stock trading, it is crucial to familiarize yourself with the regulatory framework governing investments in Malaysia. These rules ensure compliance with local and international laws, safeguarding investors and maintaining market integrity. Adhering to these regulations minimizes risks and creates a secure investment environment.

If you choose to invest through local brokers, ensure they are licensed by the Securities Commission Malaysia (SC), which oversees all financial market activities. Licensed brokers provide legal protection, offering a safer trading experience. For those opting for international brokers, verify their credentials and regulatory compliance with authorities in their home country, such as the U.S. Securities and Exchange Commission (SEC) or the Financial Industry Regulatory Authority (FINRA).

Licensing in Malaysia

In Malaysia, the Securities Commission Malaysia (SC) serves as the primary regulatory authority overseeing the capital markets. Established under the Securities Commission Act 1993, the SC is responsible for regulating and developing the securities and futures markets in Malaysia.

Under the Capital Markets and Services Act 2007 (CMSA), individuals and entities intending to engage in capital market activities must obtain the appropriate licenses from the SC. This single licensing regime requires a capital market intermediary to hold one license to conduct one or more regulated activities, such as dealing in securities, derivatives, fund management, and investment advice.

The SC evaluates license applicants based on factors including probity, competence, financial status, and integrity. Applicants must demonstrate the ability to perform their functions efficiently, honestly, and fairly. Additionally, the SC ensures that licensed intermediaries comply with established standards to maintain market integrity and protect investors.

For individuals aspiring to become licensed representatives, such as remisiers (commissioned dealers' representatives), obtaining the Capital Markets Services Representative’s License (CMSRL) is mandatory. This process involves passing the Securities Commission Licensing Examinations administered by the Securities Industry Development Corporation (SIDC), covering modules on regulatory requirements, market practices, and ethical standards.

Investor protection in Malaysia

Investor protection in Malaysia is a priority, with regulatory frameworks and mechanisms designed to safeguard investors and promote trust in the financial markets. The primary responsibility for investor protection lies with the Securities Commission Malaysia (SC) and Bursa Malaysia, the country’s stock exchange.

Key elements of investor protection in Malaysia

Regulatory oversight. The SC enforces regulations under the Capital Markets and Services Act 2007 (CMSA) to ensure market integrity and transparency. It licenses and monitors financial intermediaries, ensuring they adhere to ethical practices and maintain high standards of professionalism. Bursa Malaysia complements this by setting rules for listed companies, ensuring fair disclosure and corporate governance.
Investor Compensation Fund (ICF). The ICF is managed by Bursa Malaysia to provide financial compensation to investors in case of broker default. If a licensed intermediary fails to fulfill its obligations, the fund can cover losses up to a specified limit, providing a safety net for investors.
Dispute resolution mechanisms. Investors have access to dispute resolution services like the Securities Industry Dispute Resolution Center (SIDREC). SIDREC handles claims related to capital market products and services, offering a fair and efficient avenue for resolving grievances between investors and financial intermediaries.
Investor education. The SC and Bursa Malaysia actively promote investor literacy through programs, workshops, and online resources. These initiatives aim to equip investors with knowledge about market risks, investment strategies, and their rights as investors.
Whistleblower protection. Under the CMSA, whistleblowers reporting misconduct or breaches of securities laws are protected against retaliation. This mechanism encourages transparency and accountability within the financial system.
Corporate governance requirements. Companies listed on Bursa Malaysia must comply with the Malaysian Code on Corporate Governance (MCCG), which outlines best practices for transparency, accountability, and fairness in managing shareholder interests.

Do I pay taxes for stock trading in Malaysia?

In Malaysia, the taxation of stock trading profits depends on the nature of the transactions and the assets involved. Generally, there is no capital gains tax on profits from the sale of listed shares. This means gains from trading stocks listed on the Malaysian stock exchange are typically not subject to tax.

Capital gains tax on unlisted shares. With the introduction of the Capital Gains Tax (CGT) effective January 1, 2024, certain transactions are now taxable. Specifically, gains from the disposal of unlisted shares in Malaysian companies are subject to CGT. The tax rates are:

For assets acquired before January 1, 2024. Tax is either 10% on the chargeable income or 2% on the gross disposal price.
For assets acquired on or after January 1, 2024. Tax is 10% of chargeable income.

Listed shares exemption. This CGT primarily affects unlisted shares, while listed shares remain exempt from capital gains tax.

Income tax considerations for frequent trading. If stock trading is conducted as a business or considered frequent and systematic, the profits may be treated as business income and subject to income tax. The Inland Revenue Board of Malaysia assesses such cases based on factors like transaction frequency and holding periods.

Given the complexities of tax regulations and the recent introduction of CGT, consulting a tax professional or the Inland Revenue Board is advisable to understand specific obligations related to stock trading in Malaysia.

How to start trading US stocks in Malaysia?

To open an investment account with an online broker, follow these steps, which must be done online:

First, decide which regulated broker best suits your investment objectives.
Through the broker's app or by email, upload proof of identity and address (such as water and electric bills).
Select the account's base currency carefully, as changes can be difficult later. Options typically include USD, EUR, GBP, CHF, or AUD, with USD and EUR being the most common.
After account approval, deposit funds via credit card, bank transfer, or eWallet. Most brokers offer demo accounts to test their platforms before committing real money.
You can begin trading US stocks in Malaysia once you have made your deposits.

Is investing in US stocks worth it?

Due to the market's many opportunities for investing in the leading industries of technology, finance, automobiles, and gold, investing in US markets aids in portfolio diversification. You become independent of the Malaysian stock market and economy by investing a portion of your assets in such markets.

The market capitalization of firms like Amazon, Tesla, Facebook, Alphabet (Google), Apple, Hathway, JP Morgan Chase, and others, which have only outperformed themselves every year and make up 27.5% of the total market capitalization, is what the S&P 500 index is based on. The S&P 500 typically offers returns of up to 10%, so if you're looking to invest for the long term and ensure consistent dividend payments, you'll want a stake in these businesses. However, keep in mind that investing poorly can result in losses.

How much should I invest?

If you are thinking about investing in the US stock market, the first thing that you need is sufficient capital. But how much is enough? What is the minimum budget requirement for you to invest in the US stock market?

You’ll need at least 221.85 MYR to begin investing. It is the typical starting investment amount needed to buy 1-2 cheap shares. The minimum threshold, however, also heavily depends on the broker of choice. At the same time, it is critical to focus on systematic investment rather than the initial investment amount in order to achieve the desired result.

Fractional shares are ideal for beginners to build diversified portfolios

For Malaysian investors getting started with US stocks, a little-known but effective way is using brokerage accounts offering fractional shares. This enables you to buy parts of high-value stocks like Amazon or Tesla, making it easier to diversify even with a small budget. Fractional shares are ideal for beginners to build diversified portfolios across sectors, and automated rebalancing tools keep your investments relevant to market changes.

Another smart approach is to maintain USD-denominated trading accounts to avoid losing money on frequent currency exchanges. This is particularly useful for active traders dealing in large volumes. By simplifying international trading challenges, like managing withholding taxes through the Malaysia-US tax treaty, you can maximize returns and handle cross-border investments with confidence.

Conclusion

Investing in US stocks from Malaysia presents an excellent opportunity to diversify your portfolio and tap into the growth of global markets. By choosing the right broker—whether international or local—you can access major US stock exchanges like the NYSE and NASDAQ. Focus on brokers with competitive fees, robust trading platforms, and tools tailored to your investment needs. Start small, research the market thoroughly, and utilize tools like demo accounts to build confidence before trading with real money. With consistent effort and informed decision-making, Malaysian investors can unlock the potential of US stocks and achieve long-term financial growth.

FAQs

Do I need a lot of money to start investing in US stocks?

Many online brokers do not have minimum balance requirements so you can start with any amount. However, it’s best to start small until you gain experience.

What paperwork do I need as a Malaysian to trade US stocks?

You typically need to provide a copy of your passport/IC and a document showing proof of address. You may need to fill out an application form and W-8BEN IRS tax form.

Can I trade a fraction of shares like 0.5 shares for expensive US stocks?

Yes, many online brokers now allow you to buy fractional share quantities.

How do I fund my brokerage account from Malaysia?

You can fund your account via bank transfer, credit/debit card, or e-wallets, depending on the broker's options. Some brokers support local bank transfers to efficiently fund your trading account.

Team that worked on the article

Peter Emmanuel Chijioke is a professional personal finance, Forex, crypto, blockchain, NFT, and Web3 writer and a contributor to the Traders Union website. As a computer science graduate with a robust background in programming, machine learning, and blockchain technology, he possesses a comprehensive understanding of software, technologies, cryptocurrency, and Forex trading.

Having skills in blockchain technology and over 7 years of experience in crafting technical articles on trading, software, and personal finance, he brings a unique blend of theoretical knowledge and practical expertise to the table. His skill set encompasses a diverse range of personal finance technologies and industries, making him a valuable asset to any team or project focused on innovative solutions, personal finance, and investing technologies.

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Chinmay Soni is a financial analyst with more than 5 years of experience in working with stocks, Forex, derivatives, and other assets. As a founder of a boutique research firm and an active researcher, he covers various industries and fields, providing insights backed by statistical data. He is also an educator in the field of finance and technology.

As an author for Traders Union, he contributes his deep analytical insights on various topics, taking into account various aspects.

Mirjan Hipolito is a journalist and news editor at Traders Union. She is an expert crypto writer with five years of experience in the financial markets. Her specialties are daily market news, price predictions, and Initial Coin Offerings (ICO).