Is Bursa Malaysia over-reliant on EPF and KWAP?
Malaysia’s equities market has lagged many of its regional peers in recent years, and a significant part of the challenge appears structural rather than cyclical.
Foreign institutional investors, once a crucial source of liquidity, have been steadily retreating.
As of Sept 30, 2025, net portfolio equity outflows reached RM16.4 billion, nearly four times the full-year outflow in 2024 based on an RHB Research note in October 2025, reflecting a deepening lack of confidence among global funds.
This shift has driven foreign shareholding in Malaysian equities to just 19% of market capitalisation — an all time low, as per a CIMB Research report.
As foreign participation shrinks, the responsibility of supporting market liquidity has fallen increasingly on large domestic institutional investors, particularly the Employees Provident Fund (EPF) and Kumpulan Wang Persaraan (KWAP).
Institutional investors already hold dominant positions across many Malaysian public companies, leading to…
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