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Equities offer considerable potential for capital growth and are long term risk investments. Ownership of equities will often entitle the investor to a portion of the company's profits through dividends.

Contra Transactions


Contra Transactions

The procedures in giving orders to buy and sell in a contra transaction are the same. The only difference is that the client pays the broker or the broker pays the client for the difference in price between his buy and sell transaction.

If the buy cost is higher than the sell proceeds, it results in a contra loss which the client pays to the broker.

If the sell proceeds are higher, it results in a contra profit which the broker pays to the client.

Contra dealing is not a right of the client but rather a privilege accorded by the stockbroking company to its clients. This means that the stockbroking company is not obliged to allow contra dealing facilities for all its clients.