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.

sorry..dunno how to read chinese


btw, can u guide me on how to buy banking stock? or can u link me to any website on how this bankin stocks work? thanks...

it seems vry interesting ab this kind of stock...

Lowyat82,

Someone else has to help you. I had setup my A/C so long ago that I do not what is the new and correct procedure. Please, do not do this for your bucket 1 and 2 money. Stock market do crash and yopu need some emergency fund to survive first before you can talk about investing.

Dreamer

act... i survey 1st wether to invest in bankin stock or UT....i not yet invest coz now im savind for bucket 2 money....

.i think wit d money i hav saved from when i was small, can let me survive,at least 4month..shud i use this money to put at FD?


btw, i was thinkin to put like around rm1.2k every 2 month in FD... is this ok? i noe its not too much coz i jus started work.... so that, d money that i sav can get some interest rather than nothing

just call my mom to verify whether i am bumi or not,my mom is pure bumi but my dad pure chinese,she is not too sure too.am i a bumi?? i dont know coz my birth certificate dint verify it.some people say yes some people no.
but my mom got this ASB,so i am thinking of putting my money in her account.she is not investor,but she tell me when she put 400 and never touch it,2 years later it become 1000+,in which its huge!i cant open one yet coz i am working in uk...not going back in few years.

if you guys where me,what you guys will do?
my monthly savings(net income)is rm5.5k,currently all my money(40k)Is just sitting in the normal savings account in maybank. will you guys just put it in FD or put in ASB?whats the interest in ASB today?

Keep some in checking A/C. The rest put in 1 year FD. RM1.2K every 2 months in one year FD sound like a good plan to start.

Dreamer

Ah_suknat,

I do not know whether you should put money into ASB. But, you are comparing apples and oranges. FD is for bucket 2 money. ASB is for bucket 3 money.

Dreamer

dreamer
from your previous post,you mention that bucket 2 money is for 6 month emergencies fund,right?

but let say i dont need to have the emergency money coz i dont have car or house or any other loan to pay.what i need now is to earn money as much as possible,as fast as possible with the minimum risk.

so instead of putting some money into the FD,will it be a good option if i pump all the money to ASB?

anyhow,how does ASB or ASM works? its some kind like bond and equity rite?
can some guru tell me please...

Ah_suknat,

1) How do you know you do not need emergency fund??

2) If the stock market crashes and takes 3 years to recover, where are you going to get some money??

Bucket 3 money is for long term investment and there is risk associated that when you need the money, you may not get it.

You can put money into bucket 3 is because you have money in bucket 2. You do not need to touch bucket 3 money for a long time. It is up to you to decide how much money is needed in bucket 1 & 2 in order for you to sleep at night


Dreamer

ASB and ASM are unit trusts run by PNB. PNB is a government linked company.

ASB can only be bought by bumiputra.

Dreamer

thanks for replying,
assume that i had enough funds to cover my bucket 1 and 2,and i need some investment,do you reckon ASB is a good deal to pump all my bucket 3 funds in it? i try google ASB but nothing seems help for me to learn about it.

No idea..

Dreamer

I don't know much about ASB, but generally it is better to keep a portfolio, reduces the risk. Also, be very sure you have enough funds for emergency, liquidity is one of the main aspects taken into consideration when investing. Some tips I've learned from high ranking cooperate figures are only invest what you can afford to lose (debatable) and never take a loan to invest in share markets =P.