According to the guideline issued by the Securities Commission Malaysia, investors can be classified into three categories as shown below
Retail investors cannot invest more than RM50,000. Angel investors can only invest up to RM500,000, while sophisticated investors can invest without restrictions.
1. Retail Investor
Individual investors have the opportunity to a maximum of RM5,000 per issuer with a total amount of not more than RM50,000 within a 12-month period. This option is open to anyone. If you're uncertain about the most suitable choice, this would be a recommended option.2. Angel Investor
Angel investors are high-net-worth individuals who are eligible to invest up to a maximum of RM500,000 within a 12-month period. In addition, they must be a tax resident of Malaysia and meet one of the following qualifying criteria:
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total net personal assets exceed RM3,000,000 or its equivalent in foreign currencies; or
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gross total annual income is not less than RM180,000 or its equivalent in foreign currencies in the preceding 12 months; or
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has a gross total annual income (jointly with his/her spouse) exceeding RM250,000 or its equivalent in foreign currencies in the preceding 12 months.
(See attached source below: Guidelines on Recognized_Markets (SC-GL/6- 2015(R12-2024}
3. Sophisticated Investor
Sophisticated investors have no restrictions on investment amount and are specified under the Capital Market Services Act 2007, which include the following categories (see attached source below: Guidelines on Categories of Sophisticated Investor, pg5-10):
1. Accredited Investor
- (i) A unit trust scheme, private retirement scheme or prescribed investment scheme.
- (ii) Bank Negara.
- (iii) A licensed person or a registered person.
- (iv) An exchange holding company, a stock exchange, a derivatives exchange, an approved clearing house, a central depository or a recognized market operator.
- (v) A corporation that is licensed, registered or approved to carry on any regulated activity or capital market services by an authority in Labuan or outside Malaysia which exercises functions corresponding to the functions of the SC.
- (vi) A bank licensee or an insurance licensee as defined under the Labuan Financial Services and Securities Act 2010 [Act 704].
- (vii) An Islamic bank licensee or a takaful licensee as defined under the Labuan Islamic Financial Services and Securities Act 2010 [Act 705].
- (viii) A chief executive officer or a director of any person referred to in subparagraphs (iii), (iv), (v), (vi) and (vii) above.
- (ix) A closed-end fund approved by the SC.
2. Net Worth Entity (HNWE)
- (i) A company that is registered as a trust company under the Trust Companies Act 1949 and has assets under its management exceeding ten million ringgit or its equivalent in foreign currencies.
- (ii) A corporation that—
- (A) is a public company under the Companies Act 2016 which is approved by the SC to be a trustee under the CMSA and has assets under its management, exceeding ten million ringgit or its equivalent in foreign currencies; or
- (B) is carrying on the regulated activity of fund management solely for the benefit of its related corporations and has assets under its management exceeding ten million ringgit or its equivalent in foreign currencies.
- (iii) A corporation with total net assets exceeding ten million ringgit or its equivalent in foreign currencies based on the last audited accounts.
- (iv) A partnership with total net assets exceeding ten million ringgit or its equivalent in foreign currencies.
- (v) A statutory body established under any law whose function or mandate is investment in capital market products.
- (vi) A pension fund approved by the Director General of Inland Revenue under the Income Tax Act 1967.
3. High-Net Worth Individual (HNWI)
An individual—
- (i) whose total net personal assets exceeding three million ringgit or its equivalent in foreign currencies, provided that the net value of the primary residence of the individual contribute not more than one million ringgit of the total net assets;
- (ii) whose total net joint assets with—
- (a) his or her spouse; or
- (b) his or her child,
exceeding three million ringgit or its equivalent in foreign currencies, provided that the net value of the primary residence of the individual with his or her spouse or child contribute not more than one million ringgit of the total net assets;
- (iii) who has a gross annual income exceeding three hundred thousand ringgit or its equivalent in foreign currencies in the preceding twelve months;
- (iv) who jointly with his or her spouse or child, has a gross annual income exceeding four hundred thousand ringgit or its equivalent in foreign currencies in the preceding twelve months;
- (v) whose total net personal investment portfolio or total net joint investment portfolio with his or her spouse or child, in any capital market products exceeding one million ringgit or its equivalent in foreign currencies;
- (vi) who holds any of the following qualifications and has five consecutive years of relevant working experience in finance, economics, actuarial science or accounting—
- (A) holds a Bachelor’s or Master’s degree related to Finance, Economics or Actuarial Science;
- (B) holds a Bachelor’s or Master’s degree in Accounting; or
- (C) holds a Master of Business Administration;
- (vii) who holds the following membership in the associations as set out below:
- (A) Active Member of Chartered Financial Analyst (CFA) Institute;
- (B) Chartered Banker of Asian Institute of Chartered Bankers (AICB);
- (C) Ordinary Member of Financial Markets Association Malaysia (FMAM);
- (D) Chartered Accountant, C.A(M) of Malaysian Institute of Accountants (MIA);
- (E) Ordinary Member of Malaysia Association of Tax Accountants (MATA);
- (F) Accredited Angel Investor of Malaysian Business Angel Network (MBAN);
- (G) Certified Member of Financial Planning Association of Malaysia (FPAM); or
- (H) Ordinary Member of Malaysian Financial Planning Council (MFPC); or
- (viii) who has five consecutive years of working experience in a capital market intermediary relating to product development, corporate finance, deal advisory, investment management, sales and trading, investment research and advisory, financial analysis, or the provision of training in investment products.