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[SPONSORED] MIDF Invest Review: Buy US Stocks and ETFs from Malaysia Directly, Securely and Cheaply

This is my review of MIDF Invest, an online stock trading and investment platform which gives Malaysians direct and secure access to stocks and exchange-traded funds (ETFs) listed on the New York Stock Exchange (NYSE) and Nasdaq at competitive rates.

As of the time of writing, I have tested the MIDF Invest app for 10 days, since its launch on 6 July 2021. Because you all want a review, I will cover MIDF Invest’s features as well as rooms for improvements of the app. I will also compare it to other stock trading platforms.

The article is divided into the following segments (ratings added):

  1. How to open a MIDF Invest account – 4.5 out of 5
  2. Is MIDF Invest legit – 5 out of 5
  3. Is MIDF Invest halal – 4 out of 5
  4. MIDF Invest fees – Depends (now is good; to be updated after promo period)
  5. MIDF Invest vs Online International Brokers vs Local brokers – 1 out of 5 for people who don’t mind unregulated platforms, 5/5 for people who prefer regulated platforms
  6. Where is the best place to buy US Stocks from Malaysia
  7. MIDF Invest future plans and improvements
  8. Bonus: Stocks Investing 101 – 3 Things Newbies to the US Stock Market NEED to know

Ok, let’s start with:

#1 – How to open a MIDF Invest Account 

My rating: 4.5/5

“It takes 10 minutes to register an account while approval will be evaluated individually. It differs from 10 minutes to 24 hours for MIDF to process and approve a user account according to the Know Your Customer process.”

– Khairi Shahrin Arief Baki, MIDF senior vice-president and head of digitalisation. 

Have tried it, can confirm, registration was fast and all done online. Unlike traditional brokers, no in-person office visits or paperwork was necessary. Except for a small hiccup due to, well, lighting issue, the registration went well, I’m satisfied. 

The 3-step process to open a MIDF Invest account is:

Step 1: Download MIDF Invest 

Download MIDF Invest at: Google PlayStore | Apple App Store

midf invest review

Step 2: Complete registration and eKYC

The next step is completing a short questionnaire and to submitting your IC and selfie for eKYC purposes (KYC = Know Your Customer = a legally required process in an effort to reduce money laundering and other criminal activities).

My only recommendation here is to complete the KYC process during daytime, so it is less likely for the eKYC system to reject your IC’s picture. If for some reason that still doesn’t work, then contact their ‘Happiness Agents’ right from the platform – their customer service will assist you. 

(My other recommendation is to take a nice selfie, because the same image will stare back at you in your dashboard. I hate my own picture, I wish I looked nicer, don’t repeat my mistake.) 

(OK I have been told by MIDF Team you can change your profile pic in Settings. Cool cool)

Step 3: Fund your account 

Next, you can choose to play around the demo account, or you can start trading for real. I chose the latter and deposited RM1000 – the amount arrived instantly and ready to be used for any US stock and ETF purchase. 

…It’s so fast, theoretically I could join a social media-driven stock rally on the same day. Not investment advice. 

midf invest review

Additional info from MIDF team:

  • The account type is nominee account
  • There is no minimum deposit, but you need at least USD50 to start trading (~RM210)

#2 – Is MIDF Invest Legit

My rating: 5/5

Yes, MIDF Invest is legit. It is a partnership between:

  • MIDF Amanah Investment Bank Bhd, a wholly-owned subsidiary of MIDF (Malaysian Industrial Development Finance Bhd; been around since 1960), and
  • Saxo Markets, an online brokerage and division of Saxo Bank Group, a fully licensed Danish bank with more than two decades of experience in award-winning electronic trading platforms used by more than 120 global financial institutions.

This is how the interface looks like. Some people who are familiar with Saxo have commented that it is an easy-to-use platform, and suitable for beginners, so that’s good to know. 

midf invest review

MIDF Amanah Investment Bank is regulated by the Securities Commission and Bank Negara Malaysia. 

#3 – Is MIDF Invest Halal

My rating: 4/5

MIDF Invest comes in two versions: Conventional and Islamic. During the registration process, you can select which account you’d like to proceed with. If you select Islamic, then going forward, the platform will only show you Shariah-compliant stocks and ETFs. 

The ONLY reason why I knocked out 1 star despite Islamic filter being a rare and expensive feature is because:

  1. it significantly reduces ETF options for me. I can’t even view the Conventional ETFs, let alone buy them :<
  2. as of writing time, there are no Islamic ETFs offered yet. MIDF team said it’ll come soon, so here’s hoping

However, I have to admit that beyond being a religious obligation, the shariah filter also acts as a helpful process of elimination. Even with the filter, I’m still left with a bunch of stocks I still can buy, including the popular ones like Tesla, Apple, Microsoft etc. So.. good enough. 

As a refresher, halal investing is investments that are allowed in accordance with Islamic principles. Halal investing is not just for Muslims – Non-Muslims reading this, you are free to practice halal investing as well if you strongly dislike the following industries:

  • Excess debt
  • Tobacco
  • Alcohol
  • Firearms
  • Gambling
  • Adult entertainment
  • Impure foodstock
  • Usurious institutions
midf invest review
screenshot of the US stocks I can buy (Islamic account)

#4 – MIDF Invest Fees

My rating: Depends (now is good; to be updated after promo period)

MIDF Invest is currently running a promotion – from now until 31 July 2021, the platform charges ZERO commission for trades below USD1000. For trades above USD1000, 0.40% brokerage fee applies (subject to minimum USD5). 

Other fees are as below:

Is this cheap? Is this expensive? Read on in #5.

Note: MIDF Invest has yet to disclose its brokerage fees from 1 August 2021 onwards, other than that it will be ‘competitive’. Stay tuned to this space. 

(My take is: if there are US stocks and ETFs you want to buy, then take advantage of the promo period, because ZERO commission for local brokers doesn’t come very often.)

#5 – MIDF Invest vs Online International Brokers vs Local brokers 

My rating: 1/5 for people who don’t mind unregulated platforms, 5/5 for people who prefer regulated platforms

Before MIDF Invest, someone who wants to buy US stocks from Malaysia must pick between using online international brokers OR local brokers. Those are the only two options.

Which one do people choose? My own personal observation is that users of online international brokers and users of local brokers are two different crowds. 

Users of online international brokersUsers of local brokers
The investors and traders tend to have smaller capitals (so cost per trade matters more)The investors and traders tend to have bigger capitals (for people who make 5, 6, 7-figure trades, USD25 per trade is nothing)
Accepts risks that come with platforms unregulated in Malaysia. Relies on the platform’s reputation and track record. Understand it is hard to report to Malaysian authorities if anything happensDoes NOT accept risks that come with platforms unregulated in Malaysia. No matter what, peace of mind comes FIRST. The broker MUST be registered to operate in Malaysia. 

#6 – Where is the Best Place to Buy US Stocks from Malaysia

This is a continuation of section #5. 

So where is the best place to buy US Stocks from Malaysia? As always, the answer is it depends on the type of investor you are. Now that MIDF Invest entered the picture, here are the top pros and cons of each platform:

Types of BrokersProsCons
Online International Brokers
(eToro, TigerBroker, TDAmeritrade etc)
– Cheap (low to zero commission)
– Unregulated in Malaysia
– Takes time to open account 
– Funding account takes days (may even get stuck for weeks)
Local brokers
(Hong Leong, CIMB, etc)
– Regulated in Malaysia
– Expensive (USD25 per trade!)
– Takes time to open account 
MIDF Invest– Regulated in Malaysia
– Cheaper than local brokers
– Can open account in 10 minutes 
– Fund deposits arrive instantly
– Not as cheap as online international broker
– New; still in Beta 

If your definition of ‘best’ is:

  • cheap, and
  • you don’t care about regulation status, and 
  • you want to trade more often, 

Then those online international brokers are ‘best’. 

But if you’ve always been seeking out a regulated platform to get US stocks and ETFs at lower fees, then MIDF Invest is worth a try. MIDF Invest is for people who want a broker that is BOTH regulated in Malaysia AND cheap(er than existing options)

#7 – MIDF Invest: Future plans and improvements

MIDF Invest is still in beta phase and has lots of room to grow. There are big plans for the app, online broking is just the first product. When asked about it, Khairi Shahrin Arif Baki, MIDF senior vice-president and head of digitalisation replied this to an online query:

midf invest review

So here’s hoping for fractional shares, automatic portfolio allocation and other nice features in future updates 🙂

#8 – Bonus: Stocks investing 101 – 3 Things Newbies to US Stock Market NEED to know

There are many things to know about the stock market, but here are some that newbies to US stock market NEED to know:

#1 – Basically what stock investing is

Watch this video if you’re very new to the stock market, as an investment.

The stock market attracts investors and traders. There are many differences between them, but I’d say the primary difference is the frequency of trades – traders buy and sell stocks more often, as frequent as a few times a day (day trading) to a few times a week/month/quarter (swing trading)*. 

In contrast, a traditional investor ‘stays the course’ more and would rarely sell unless changing strategies or rebalancing their portfolio. With investors, keeping their stocks for decades is not unheard of. 

Important: Both investors and traders can become gamblers if they let greed take over. It is especially dangerous with leverage, ie when they allow you to make trades bigger than your capital. It amplifies your wins, yes, but also your losses. 

*There are more types of trading. Won’t go there here. 

#2 – There are many stock markets around the world

In Malaysia we have Bursa Malaysia, which lists Malaysian companies. If that is all you have known so far, then may I introduce you to a snapshot of the global stock market in various geographies. 

howmuch.net us stock market
Source: https://howmuch.net/articles/all-stocks-capitalization-around-the-world

Puts things in perspective, doesn’t it? Malaysia market is so smol in comparison to the US stock market. The US market is also the center of innovation, and innovation tends to have the highest growth. 

#3 – You don’t have to get individual stocks

Personally, as much as I believe in diversifying my investment portfolio to include the US stock market, I also have no interest in individual stock picking (unless you’re working in and/or super familiar with an industry, I think it’s mostly luck tbh) nor do I have interest in trading (ie frequent buy frequent sell). 

If you’re like me, then the financial instrument you’re looking for is called ETFs – exchange-traded funds – baskets of investments that resemble mutual funds, but trade on an exchange like a stock. All I want to do is get my hands on ETFs that track the top companies in the US, and just leave it to grow. 

Happily, this is something that MIDF Invest offers. Vanguard S&P 500 ETF is *the* ETF to get if you believe that the US economy as a whole will grow in the long term.  

(Note: Unfortunately this particular ETF is only offered to Conventional accounts *cries in Muslim*) (MIDF team said more ETFs will be offered to Islamic accounts, in due time)

midf invest review

Last reminder and obligatory CTA: from now until 31 July 2021, MIDF Invest charges ZERO commission for trades below USD1000. For trades above USD1000, 0.40% brokerage fee applies (subject to minimum USD5). Take advantage of it while it lasts.

Download MIDF Invest at: Google PlayStore | Apple App Store

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One Comment

  1. Any fees for dividends from US? Taxable in Malaysia?
    What is the minimum size of purchase? Fractions or minimum 1 share.

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