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 ICT Zone Ventures - 8% p.a. yield, Highly not recommended to invest

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Lucky_Lucky
post Mar 27 2014, 02:48 PM

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QUOTE(MNet @ Mar 26 2014, 09:35 PM)
what different between buy from member compare to buy direct from company?

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This page in their website is for two purpose: -
(i) For existing investors to sell their investment units
(ii) For new investors to buy investment units from (i)

Benefits to buy from existing investor: -

(i) New investors get higher profit sharing from old units

Reason: ICT Zone Ventures Scheme is Shariah-compliant. That means on top of the 8% annual yield, investors are also entitled to additional profit sharing in the end of the scheme (year 2020) based on business performance.

Example: Let's say new investor Mr. Jacky buy directly from company now (March 2013). The unit investment date will start now, in the end of the scheme (year 2020), his profit sharing will be calculated start from 2013.

If Mr. Jacky now buy directly from existing investor Mr. Leon who already start invest since Jan 2012, then the unit investment date will start from 2012 and in the end of the scheme (year 2020), his profit sharing will be calculated start from 2012. Earlier means better.


(ii) New investors may get cheaper price

Reason: The original price for one unit is RM5000. However as you can see, the existing investors who wanna sell can choose to sell at lower price.
What? Then means the seller will suffer loss la? Why seller willing to suffer loss to sell their units?

Not really, the seller don't really suffer loss, even selling at lower price.

Example: The return for this investment is 8% per year and RM5000 x 8% = RM400 (every year).
Let's do a simple calculation, Mr. Leon start invest since Jan 2012.
That's mean until now (March 2014), he already invested for 2 years and a little bit.
Assume he want to sell his investment unit now and set the selling price at RM4500.
If someone buy from him now, he will get RM4500.
From the total cycle of Mr. Leon investment, he get returns of:-
RM4500 (Selling price) + RM400 (8% returns from year 2012) + RM400 (8% returns from year 2013) = RM5300

Means still get RM300 returns from RM5000 he invested at first.

Justification to sell at lower price: Most probably is because the seller need fast cash.
If other seller offer RM5000, but you offer RM4500, most probably you will sell faster. Open market.
However seller have to make sure selling price cannot less than [RM5000 - returns already received],
if not, will suffer lost.

However if existing seller can wait, then he can just set the selling price as per original price RM5000.
Use back the example of Mr. Leon, if he choose to sell at original price RM5000.
Then from the total cycle of his investment, he will get returns of:-
RM5000 (Selling price) + RM400 (8% returns from year 2012) + RM400 (8% returns from year 2013) = RM5800

Means get RM800 returns from RM5000 he invested at first.
Lucky_Lucky
post Mar 28 2014, 02:30 PM

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QUOTE(MNet @ Mar 27 2014, 08:43 PM)
What is the fee involve if buy from other investor?

I see from calculation buying from other investor(rm4600) will be more profitable compare to buy direct from company
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Oh ya, forget the admin fees d :x

If I didn't rmb wrong, RM100 will be charged toward seller, but not the buyer.
If the selling price is RM4600, then buyer only pay RM4600.

So correction here, if buyer don't want to suffer loss, then the selling price cannot less than
[RM5000 - Returns already received - RM100]

Ya, if existing investor is willing to sell at lower price, then buying from existing investor is recommended.
Lucky_Lucky
post Mar 30 2014, 05:12 PM

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QUOTE(MNet @ Mar 28 2014, 04:50 PM)
what mean by the company will refund the ICT investor the total amount invested minus the dividend given received by ICT investor?

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When you don't want to keep the investment units anymore, you have 2 options:-

1.) Sell to others (like last post mentioned)
2.) Sell back to the company (aka Buy-back)

Buy-back

Meanings: The company will refund to investor the total amount invested minus the returns already received.

Example: The return for this investment is 8% per year and RM5000 x 8% = RM400 (every year).
Use back the example for Mr. Leon, he start invest since Jan 2012.
That's mean until now (March 2014), he already invested for 2 years and a little bit.
Assume he want to trigger Buy-Back now.

Total amount invested: RM5000
Dividend received: RM400 (year 2012) + RM400 (year 2013)
Admin fees: 1% = RM50 (This time I rmb d rclxub.gif)
Total Refund he can get back: RM5000 - RM400 - RM400 - RM50 = RM4150

Means in total investment cycle, he get returns of:-
RM400 + RM400 + RM4150 = RM4950
In the end, Mr. Leon lost RM50 from RM5000 he invested at first.

Conclusion:
Thus trigger Buy-back is not recommended at all,
cuz u will get totally nothing after put the money there for several years,
u invested RM5000, u get back RM5000.
plus still need to pay the 1% admin fees.Will lost no matter how.
However the lost will limited to the 1% admin fees only.

If you want to sell the investment units, go for "selling to other investor" option.
Unless you really really really need fast cash.

 

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