You are not even using the same amount of principal (60K versus 10K) for comparison..


Dreamer

This post has been edited by dreamer101: Aug 12 2006, 10:36 AM

Ah.. I was replying the same thingy and about to hit the post button before I saw your reply. Thanks for clarifying.

Hope this helps.

Your calculation for 6 months is way too off.

Principal - RM10,000 (10k will always be 10k no matter how many months you put into FD)

i left out d interest

the calculator link is quite usefull but is it accurate?does it take into account of auto renewal as dreamer mention?
or compounding interest etc?

no but u can do it urself.

first time: u put 10000 then u get 10025.83
second time : u put 10025.83 then u will get 10051.73

just do it urself.

awww..... sorry ... my mistake....it shud b each of it FD for 6 month....

so, its shud b same money... i mean each of it earns 175 -> 175x 6 =1050

hmmm i bump to this statement from last time forummer.... wats ur opinion....

That's y unit trust grow faster nowadays. still remember last time i queue for around 1 hour for ASW2020, no yet my turn the fund already full.

Lowyat82,

Anybody that read a bit more about personal finance will not make that kind of sweeping statement. The smartest statement that anyone can make is "it depends".

For examples, there are at least 3 buckets of money

1) Money that you use for normal expense. You keep this in a checking account

2) Your emergency fund. Money for 3 to 6 months of expenses. Some times, you may even keep 12 months or more if you think a recession is coming. This bucket of money are put in a safe place and earn a bit of interest like FD

3) Money for long term investment

Normally, you need to have (2) before you start thinking about (3). And, (3) is where you may put money into unit trusts and etc..

I know I am not smart enough to play in Malaysia stock market. So, the only risky invetsment that I do in Malaysia is one banking stock that I can trust. It pays dividend much higher than FD. But, I have money in (1) and (2) so I can take the risk.

Dreamer

This post has been edited by dreamer101: Aug 12 2006, 11:41 AM

Lowyat82,

The inflation > interest thing is a bunch of BS anyhow. Inflation is measured as per a normal average human being.

1) Nobody is a normal average human being. So, if you are frugal, inflation may affect you less than other people. If you pay off your car and house, it will affect you even less.

2) You have to think like "Rich Dad, Poor Dad". It is all about cash flow.

Let's say you spend $30K per year. If your salary plus investment income is $36K, you have 6K extra to invest every year. If you put the money into FD, it will generate more cash flow for you. If you keep this up, your cash flow will grow and eventually you will be well off. There are people that I know that they only save money, buy house and FD. They are doing fine too.

As long as your cash flow is positive and you invest your excess cash flow for asset ( things that generate cash flow as per RDPD), you will be fine in the long run. You might be slow but you are steady.

I am not saying whether you should or should not buy Malaysian unit trust. I am saying I know that I am not smart enough to invest in Malaysian unit trust. It is not right for me.

Dreamer

This post has been edited by dreamer101: Aug 12 2006, 01:11 PM

ok.. thanks for ur comment... btw, does "Rich Dad, Poor Dad" got electronic version? last time my fren recommend taht book to me... but i dun read it >.<'





can tell more ab banking stock? wats taht? something like shares?

1) Yes, banking stock = share aka own the bank.

2) You can get the chinese version of the book very cheap.

Dreamer

Just wondering, my friends all put their money into ASB and it seems that they have quite a nice amount of dividens. I wonder as a non-bumi where shall I put my money apart from FD?

I'm keen into putting my money in unit trust. ANy comment on that? Would like it to deduct per month say about RM200.00 and would like to withdraw in case of emergency.

For UT, after the BNM liberalise some restrictions, there are plenty of global UT as well, basically you are investing in foreign country mostly developed country fund which has been performing quite well recently.

Local UTs are not performing well for the last 2 years or so mainly because KLSE has been underperforming compared to the regional bourses. Foregin fund basically only show little interest in Malaysia market for the last few years time mainly due to slow progress in GLCs restructuring and various problem hanging in the market like MAS, Proton, TNB vs IPP etc. Market sentiment also not helped by recent outburst between TDM and PL which basically exposed more and more problem and weakness of current economy situation.

stocks like CIMB, PBB, Maybank and so

1) As I had said, I have only trust in one bank. The one that is most well managed.

2) This is my basic logic for investing in bank.

A) Bank is guaranteed to make money in Malaysia. Due to lack of competition and regulation, the margin ( the difference between FD and loan rate) is very high ( 3% to 4%). So, if the bank is well managed, it will make a lot of money.

B) Even if we hit a recession, the government will not let the bank failed. A well managed bank will handle recession much better than others.

C) This particular bank stock pays good dividend. So, I am getting good cash flow. I do not have to sell the stock in order to make money. It does not really matter to me whether the stock is up or down since I will collect dividend every year.

D) Demographically, 67% of Malaysians is less than 35 years old. There is growth here.

E) Unfortunately, the new generation is not frugal and careful about finance. So, they will pay more money to bank in interest for credit card, Hire Purchase and housing loan. Bank will makes a lot of money from the new generation. I can offer advice but if people will not listen, I must as well profit from that.


Dreamer

This post has been edited by dreamer101: Aug 12 2006, 09:31 PM

agree on you in part E .... this trend not only in Malaysia but lot of places around the world
as for part C i love the dividend.... while is still offers capital gains

To be precised, the possibility of capital gain. Until you SELL the stock, it is just a paper gain. The lot size and the price of the stock make the share in Malaysia very large ( a few Ks). Unless you have a lot of money, you cannot really sell teh stock a small amount at a time.

Dreamer

Currently, the best well-managed local bank is Pbb which has the lowest NPL compared to others rivals even when financial crisis 98 hit time, its NPL still not way below double digit level. Also, for previous 2-3 years, it has good dividend yield roughly 8-10% (I don't have the figure with me currently) annually. This year will be a bit lower due to newly acquisition of Asia Commerce Finance in HK and need some fund to finance it.