What do you know about trading companies? Chances are – not too much. However, trading companies are amongst history’s most successful and influential businesses being around since the dawn of time. When Britain colonized almost half of the world is when international trade became commercial and flourished. Nowadays trading is more modern and complex than ever before. It has become more than just standing in a market or selling in shops. The 21st-century trading company is a modern business which delivers goods and products to customers worldwide.
Let’s focus on trading companies in Malaysia and what they can do for you. Malaysia is a very competitive market and economy where one small step could have large benefits or sever blowback. How you act has a short-term and long-term effect. Managing both to maximize profits and success is the way to do business. PointOne believes that utilizing a trading company’s services to your advantage is a great way to establish a local presence in a new market or become a force to be reckoned with on a global scale. Trading companies overlook distribution, logistics, supply, import, export etc. It is like the whole package of services that could benefit your business immediately. Look at businesses who start and are instantly successful right of the bat. They have to have good sales numbers. How are they achieved? Usually through well thought out business strategies and wise moves but you can simply trust a trading company in Malaysia to find solutions to your problems. Whether you have the urge to increase sales or just to introduce your products to a completely new market and audience – PointOne can arrange all that. By connecting you with worldwide trading companies or finding a specific trading company in Malaysia, PointOne is able to satisfy clients by meeting their demands for more income and sales.
Trade is the most essential part of any business. If you are trading and selling this means that your business is capable of sustaining itself to a certain extent. However, trade in a foreign new market or expanding your operation to a larger scale is very difficult. That might require a lot of finances and human resources which is usually not something a small or medium sized business can afford. It is a lot wiser to invest into different spheres and areas of your operation instead of making trade your top priority. Connections, flexibility, large global presence etc. These are the traits a good trading company in Malaysia or anywhere else in the world has to possess. We can connect you with such immense and powerful businesses so you can reap the benefits of their services. No need to worry about anything else other than your production. Trading companies take care of everything from A to Z no questions asked. Your goods are picked up, exported, imported, distributed, placed on the shelves or online and brought to the buyer’s doorstep. The same goes for B2B business models.
B2B is mostly the case with trading companies nowadays. Retail is a completely different sphere, but some trading companies in Malaysia do meddle in it also. However, in the 21st century, the term trading company is usually associated with B2B solutions only. This goes worldwide and is not just a local phenomenon. The trading market has evolved greatly over the past couple of decades. With the introduction of computers and world wide web, trading, just as the majority of other business and services transferred over to the virtual space. Here every deal happens quicker and more fluently.
Nevertheless, some things stayed the same. For example, connections and distribution networks are still located in the hands of trading companies. They can offer better prices, quicker solutions and more efficient action. If you are doing business in Malaysia, we heavily suggest you at least get to know about trading companies.
If you have any questions, enquiries or want to get in touch – you can do it via email or by contacting us through the contact form on our website. Let’s get in touch and work together to strengthen your business in Malaysia!
Automatic billing, flexible commission markups and interest markups and markdowns are part of our turnkey solution for broker/dealers and introducing brokers.
Brokers have the ability to charge their clients for services rendered based on a fee-per-trade unit for each asset class (e.g. stocks, options, etc.), exchange and currency. The trade unit is determined by the unit Interactive Brokers uses for its commissions charges and can be on a per share, per contract, or % of trade value basis.
Specify all commission markups on the Client Fees page in Account Management.
Client fee schedules can be applied to accounts individually or can be stored in templates. As a broker, you can configure fees for one or more client accounts, or set up client fee schedules in templates, then assign the templates to client accounts. The use of templates allows you to easily maintain different fee schedules for multiple client accounts.
If you are a new broker (i.e. you just opened your ALGC account), then there will be a blank default client fee template, which you can then configure with your own fee schedule. If you are an existing broker, your old global fee schedule is now the default client fee template. You can modify the default template but you cannot delete it.
The following general rules apply to broker client fee schedules:
For each asset class/currency, a broker can select one of the fee-per-trade client markup types listed below:
Brokers can view all commission markup schedules for their client accounts on the Markup Summary page in Account Management. The Markup Summary sorts information by fee schedule, and displays client accounts that use the global markup schedule together.
We charge a minimum fee for US stock trades allocated by Brokers to their clients. Brokers can choose to charge the allocation minimum fee to their master account or to the client account. By default, the allocation minimum is charged to the client account unless there is a specific rate arrangement between the client and the Broker.
The minimum amount charged per trade allocation is as follows:
Brokers can mark down credit and short proceeds credit interest and mark up debit interest. Markups and markdowns are entered as % with the following fields available for input:
Brokers can charge markups to their clients based on our stock borrow rates, entered as a variable or fixed percentage of our borrow rate. You can enter both types of markups and our system will apply the markup rate that results in the larger total amount.
Symbol ABC Borrow Rate = 35%
Variable Borrow Markup = 20%
Fixed Borrow Markup = 1%
Variable markup
35% (1 + 20%) = 42% total cost to your client
or
0.35 (1.2) = 0.42
Fixed markup
35% + 1% = 36%
or
0.35 + 0.01 = 0.36
Our system applies the larger total amount, so in this example, we would apply the Variable Borrow Markup and the total cost to your client is 42%, which includes our borrow rate plus your borrow markup.
Note: Interest markups and markdowns are rounded to two decimals.
Fully-disclosed brokers can configure and submit electronic invoices from the Invoicing page from the Manage Client > Fees menu in Account Management. Before you can submit fee invoices for client accounts, you must first configure Automatic Billing for Monthly/Quarterly Invoicing for the account(s) on the Invoicing page. You must specify a monthly or quarterly markup limit, then calculate the markup and submit an electronic invoice for each client account at any time, up to the specified limit. The invoice amount will be automatically transferred from the client account to the broker account. Invoices submitted prior to 5:30 (17:30) PM EST will be processed by ALGC the same day (U.S. night) and appear on that day's statements. Invoices submitted after 5:30 (17:30) PM EST will be processed by ALGC on the next business day. You can submit invoices for up to ten clients at a time, but only one invoice per client account per day.
You can also upload a .csv (comma-separated values) file containing multiple client invoices. The .csv file must contain fields for:
Invoices submitted after 5:30 (17:30) PM EST will be processed by IBKR on the next business day. You can submit invoices for up to ten clients at a time, but only one invoice per client account per day.
Introducing Broker client markups are limited to 15 times ALGC's highest tiered rate + external fees. In the case of US stocks, the highest tiered rate would be 0.0035 USD per share. USD-denominated bonds are subject to a separate cap on mark-ups. US option mark-ups are limited to 10% of trade value. 25% of debit interest markups over 1% will be collected by ALGC. These limits are subject to change, and specific products may have an additional limit in place. No markups will be applied if a client calls ALGC to close a position.
This type of finance bridges the funding gap created during the period from the time of an invoice is issued to a buyer to the time that the buyer pays for the goods/services.
Hence, cashflow finance assists businesses with the financing required to deliver purchase orders from buyers. The primary security for cashflow finance is sales invoices. Cashflow finance is also known as sales finance and includes specific financing solutions such as factoring and invoice discounting.
Cashflow finance uses a revolving credit facility in which new invoices received will make new funding available. The source of income for paying back the loan is in the debtor settling outstanding invoices. Such type of finance is also termed as factoring, invoice discounting or sales/invoice finance.
Cashflow finance enables the business to release the money it's owed by its customers (account receivables) to fund business growth or to meet the day-to-day financial obligations. Credit limit to the revolving facility is sanctioned based on the assessment the borrower’s credit risk.
The two main types of cashflow finance are recourse or non-recourse. Recourse factoring assumes that customer non-payment risk is covered by the debtor (seller). On the other hand, non-recourse factoring assumes that the lender assumes
customer non-payment risk.
For both recourse and non-recourse factoring, lenders support credit control and collections by providing sellers with services that help manage the sales ledger by issuing statements and provide credit control services through letters or phone calls to buyers under credit control. However, confidential invoice discounting services are available for businesses that want customers to be unaware of lender involvement. It is simple to operate, with limited administration, whereby the business retains complete responsibility over managing customer payments and credit controls.
Non-recourse factoring is more expensive than recourse, since in the latter the risk is covered by the lender. The main costs involved are:
Dependent upon the size of entity there is a credit control cost to the business.
Setting up the facility for the first time normally takes a couple of weeks. Once the facility is arranged most banks will offer the ability to access cash electronically. Once the invoice is uploaded, cash is usually available to be drawn within 24 hours.
The right finance for your business section gives examples of financial structures that are suitable for different trading types and sizes of business.
Cashflow finance is a short term financing solution and can be useful to bridge cashflow gaps. Other types of finance suitable for this use are overdrafts and business credit cards..
For longer term financing needs, a ALGC loan or a commercial mortgage might be more appropriate solutions.
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