KUALA LUMPUR (April 16): The Securities Commission Malaysia (SC) has further liberalised the short selling and market-making framework to increase the country’s market efficiency, according to the SC's 2019 annual report. 

This is because market makers continue to be key in promoting liquidity and depth, given their readily available presence in the market as counterparties to investors, the SC said in the report released today (April 16).

“The liberalisation serves to expand the pool of market makers to include standalone foreign corporations to market make products on Bursa Malaysia. 

“In addition, there will be an expanded range of approved securities for short selling to boost the liquidity of small and mid-cap shares.

"To ensure that short-selling activities undertaken will be conducted in an orderly and controlled manner, the short-selling position limits on a particular security will now be combined for both regulated short-selling and permitted short-selling framework,” the SC said.

The SC said the expanded range of approved securities for short selling will include all exchange-traded funds (ETFs) except for inverse ETF. 

In addition, the market capitalisation criterion will be lowered from the current RM500 million to RM200 million,” the regulator said.