good for as-long-can-make-profit investors

pass this sukuk for the time being

I also skip this for now

Rm100/unit, i see why people not interested

U mean it's too expensive ? U need to buy min 10 lots so RM1,000 is the minimum. So U think people cannot afford RM1,000 as if they buy Caring, min 100 units only RM125 ?

I will skip this one.

Very sensitive word and you can keep it for yourself.

my meaning is , with rm100/unit, investors still have better option to look for. But "Not Affordable"?

I will apply

Sorry, I misunderstood U. U can't compare a bond vs a share - they are different things. For this bond, min units to buy is only 10, so min is RM1000. For shares min is 100 units, so if for UMW O&G, its RM250.
Similarly U can't say FD is expensive as min to start a FD is usually RM1000, but savings accounts, usually just RM10 will do.
Bonds need to have min RM1,000 else it is just not worth the time spent to buy cos U earn just RM45.80 yearly interest, so there really is not worth the effort if they allow min 1 unit of RM100 as then U only get RM4.58 per year interest.

No need sorry bro. Im learning from u too

Bonds remind me of leyman brothers

Thanks for your simulation, appreciate

U can't compare this Malaysian government guaranteed bond vs Leyman Bros. If U can't trust the government then U should also not trust putting your money with the banks which is also guarantee by the govt.

Monies at Bank is guarantee by PIDM

Agree. Bank deposits (up to a certain limit, probably RM100,000) guarantee by a company call PIDM which is owned by the government while this sukuk is guarantee by government...same iron-clad guarantee...both by govt....so your principal it's perfectly safe.

The tenure is 15 years, so i have to wait until 15 years in order to get my profit?

Nope
U can exit anytime
They will pay interest every 6 mths

PIDM is Rm250K.

PIDM is government agency that run an insurance scheme whereby banks do pay insurance premium in order depositor holders get RM250k guaranteed protection from the insurance.

While sukuk guaranteed by gov, is a bond that guaranteed by gov without any insurance scheme in place like PIDM.

So their structure is different, although both are tightly related to gov.

Bank deposit safe or not, has 2 layer protection.
1. First layer protection. The bank financial sound, and has adequate capital to meet the liabilities, then your deposit is safe, disregard the PIDM or gov defaulting.
As even gov default their bond, if bank is financial sound, your deposit is still safe.

2. Second layer,PIDM protection only need to be activated if the bank defaulted.

For, sukuk/bond
1. Ability of issuing company to repay.
2. Gov fulfill the obligation of guarantee (if it is guaranteed by gov)

So both have distinct difference.

As you can have a scenario that gov defaulted, while bank still sound, means deposit still safe.
While if gov has financial problem, the those bond guaranteed by gov, may have a risk being defaulted, if can't be redeemed by the issuing company.

Gov can default, if financial situation really turn really really bad time.
So I do not think, it is a right word to use "perfect safe" instrument even though it is gov owed/guaranteed. Although it is unlikely to happen is most of time. there were a few gov did default before.

Also I do not think it is right to group together FD and Sukuk/bond guaranteed by gov, they do have distinct difference.

Yes, the sukuk is quite safe, but cannot say it is as safe as FD or same as FD. They are different.

This post has been edited by cherroy: Nov 2 2013, 03:52 PM

Every 6 months, you get payment for the interest, disregard bond market price out there for the bond.

Whether one able to make a profit from the bond or not, it depends on the market price then.
A bond IPO at Rm1.00, can be traded at Rm1.02 or Rm0.98 as well, largely depends on interest rate environment out there.

Thank for sharing!!!
have you buy any? worth?

Reminder
Closing on 15/11/2013
http://www.mih.com.my/index.php?page=ongoing

still got 1 week more for those interested