The Securities and Exchange Commission of Myanmar is planning to enable foreign investors access to the new Yangon Stock Exchange, which might transform the dynamics of the local market.
Furthermore, Maung Maung Win, chairman of the Yangon Stock Exchange, stated that the Myanmar Companies Act is now being amended. The new law, which will allow joint venture businesses to list on the Yangon Stock Exchange as well as international investors to invest directly, is expected to be passed this year. This is expected to significantly increase liquidity in Myanmar’s stock markets.
Exchange risk, liquidity risk, and political risk are all high for foreign investors buying into Myanmar.
In a recent interview, Enrico Cesenni, co-founder and CEO of Myanmar Strategic Holdings, stated that the major dangers foreign investors face when investing in Myanmar are a lack of liquidity and transparency. “Investing in Myanmar carries three key risks: market risk, restricted liquidity, and a lack of transparency. Being listed provides you with some liquidity. When you’re young, it doesn’t provide a lot of liquidity, but it does provide some. Finally, there is openness. Myanmar is a market with a negative reputation, therefore the question is how can you convince people that you have a solid reputation, an independent board, and skilled personnel,” he said.
As a result, to gain greater access to money, Myanmar-based companies have chosen to list their shares on popular stock exchanges in other countries. However, listing on overseas exchanges requires these businesses to adhere to corporate governance norms, which can be difficult to achieve.
How can I go about purchasing stock in Myanmar?
To open a securities account, you must first select a securities company that has a securities license and trading qualification.
To open a securities trading account, an investor must go to a preferred securities business and fill out an application form.
On the next working day, a Securities Company will issue a Recommendation Letter, allowing the applicant to open specific bank accounts for securities trading in Myanmar.
What should I put my money into in Myanmar?
Myanmar is one of the world’s remaining unexplored mobile markets, with only about 10% of the country’s 60 million people owning a phone. The government is liberalizing the telecoms industry by enabling multinational companies to form joint ventures with local ICT (information and communication technology) companies.
The Internet has been more accessible to the Burmese people since the civilian administration assumed control in 2011 and implemented substantial reforms. In Myanmar, Samsung is the market leader in mobile phones, tablet computers, television sets, video players, and refrigerators. Samsung began working with two local partners and increased its distribution in 2012, as one of the early movers.
ETFs still have costs to consider
In most circumstances, once you pay the trade charge, you can keep the stock or bond without paying any more costs.
Depending on whatever ETF you invest in and which brokerage firm you use, you may have to pay similar costs when buying or selling ETFs.
That management, no matter how insignificant, costs money. Expense ratios are paid on most ETFs to compensate these costs.
Not all investments are available
ETFs normally provide a good selection of assets, but you won’t be able to invest in everything with an ETF.
While industrialized markets may have a big range of bond ETFs, stock ETFs, and just about every other sort of ETF you can think of, emerging markets may not.
You may also want to make other types of investments that aren’t appropriate for ETFs.
If you want to acquire a specific rare vintage car or work of art, an ETF won’t be able to help you.
Harder to pick investments or investment mixes
Some people want to be very hands-on when it comes to their investing. Others will not invest in certain firms or asset classes because of their sustainability or values.
Some people, for example, will not invest in companies that offer meat or cigarettes.
It may be tough to find ETFs that invest in accordance with your very precise investing objectives. Stocks of companies you don’t wish to own may be included in ETFs.
You can find up owning certain investments in many ETFs due to their broad reach.
This may give you the impression that your asset allocation is different than it is. It may also put you at risk of being overly invested in specific companies or investments.
As a result, knowing what you’re investing in within each ETF is critical. Then you may assess your investments as a whole to ensure you’re getting the right amount of exposure.
Partial shares may not be available
You may not be able to acquire partial shares of ETFs depending on your brokerage business. While this isn’t a major issue, it can make investing more difficult.
If you wish to invest $500 per pay period with a brokerage that doesn’t accept partial ETF investments, you’ll need to figure out how many entire shares you can buy with the money you have.
Any money left over would have to be put aside until your next paycheck, when you’d have to figure out how many shares you could buy at the pricing of the next payment.
Because mutual funds allow you to purchase fractional shares, you might easily deposit $500 each week.
If partial shares are crucial to you while investing in ETFs, check to see if partial shares are offered with the brokerage firms you’re considering before opening an account.
Can foreigners purchase ETFs?
Investors are constantly looking for new ways to broaden their market exposure and profit from lucrative possibilities. For those who are willing to take on a bit extra risk, international investment is a possibility.
Investors can diversify their investments by location or increase or decrease their exposure to emerging, stable, or expanding foreign investment kinds by investing internationally. Overseas exchange traded funds (ETFs) are cost-effective and advantageous assets for your portfolio, allowing you to invest in foreign markets immediately.
You can utilize six different types of overseas ETFs to diversify and grow your portfolio.
Is there a stock exchange in Myanmar?
One of Myanmar’s two stock markets is the Myanmar Securities Exchange Centre (MSEC), which is located in Yangon. Only two securities are currently listed on the exchange, which is a 50-50 joint venture between the state-owned Myanma Economic Bank and the Daiwa Securities Group. Despite the establishment of the Yangon Stock Exchange in 2015, the over-the-counter (OTC) market remains open.
What exactly is Myanpix?
MYANPIX (Myanmar Stock Price Index), whose registration numbers are 4/8680/2016 and 4/8681/2016, is a YSX-calculated stock price index that measures price fluctuation in an entire stock market and serves as a basic tool for investors to characterize Myanmar’s stock market.
What is the best Myanmar business?
Myanmar has a lot of mineral resources and fertile terrain. As a result, you can establish a farming, manufacturing, or related business in Myanmar.
Myanmar has become more accessible to foreign investment and business since 2011. You have a fantastic opportunity to establish a business in Myanmar.
Myanmar has abundant coal and petroleum reserves, as well as a large solar energy potential. This is yet another advantage of starting a business in Myanmar.
Can foreigners purchase property in Myanmar?
Foreign individuals and companies are not permitted to own real estate in Myanmar, with the exception of condominiums, where foreigners may own up to 40% of a condominium building’s total units.
Are ETFs suitable for novice investors?
Because of their many advantages, such as low expense ratios, ample liquidity, a wide range of investment options, diversification, and a low investment threshold, exchange traded funds (ETFs) are perfect for new investors. ETFs are also ideal vehicles for a variety of trading and investment strategies employed by beginner traders and investors because of these characteristics. The seven finest ETF trading methods for novices, in no particular order, are listed below.