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 EPF DIVIDEND, EPF

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cherroy
post Oct 22 2015, 12:54 PM

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QUOTE(danmooncake @ Oct 22 2015, 12:43 PM)
FBMKLCI is still negative for the year.  Ringgit has dropped over 20% this year.
That's means a lot of companies earnings flat this year.

Syariah or not (early bird or not), I wonder how they will turn up another 5%+ yield or higher rate?
Perhaps 2.5% may not be bad after all.  brows.gif
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Bulk of investment is in MGS.
MGS currently yield about 4.x%.

While for stock market investment, EPF does receive dividend, and some stocks are performing well due to USD rise (just like financial result of Topglove recently), so there will be still some earning, although likely to be lesser than previous year.

Also EPF does venture into overseas market as well, beside potential gain in valuation in the investment, the exchange rate will gain them some hefty figure as well, as RM has dropped about 25% vs USD.

So return may be less, but dividend declared shouldn't be too bad until need to be below 4~5% or the min 2.5%.
cherroy
post Oct 22 2015, 01:11 PM

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QUOTE(McFD2R @ Oct 22 2015, 11:54 AM)
For now, probably so. But if in the event, the difference >1% consistently, that does make a difference especially when it is compounded every year till 55, or eventually 60. Hence my view is that all investments by KWSP should be wholly and collectively made in the fair interest of all contributors and divided equally and proportionately. Because unlike Banks, where we can have choices to decide whether to take up their products or not based on the T&C, EPF contributions are mandatory. We do not get a say on where and how they invest, and nothing to govern the returns if any, except for the minimum 2.5%. As such, all funds that are generating returns should be fairly distributed.
» Click to show Spoiler - click again to hide... «

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You can't drag some profit made in non-syariah compliance investment, and declared in islamic account.
It defy the origin purpose of it.

So likely, they may operate in different set of account or investment.
It is not the like EPF lump sum money made, and then distributed between conventional and islamic account.

When you have islamic account and KWSP-I which is syariah compliance, then they need to ensure the money will be investing into syariah component of investment, by then profit shared for the account.

It is like ASx declared 7%, while ASy declared 7.5%, while ASz declared 6.8%, they also run under the same roof aka PNB, but invested differently between them.

I don't see much issue, as you have the option to choose.
One may better or worst than the other, which may vary from time to time due to market situation.
cherroy
post Oct 22 2015, 02:16 PM

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QUOTE(prophetjul @ Oct 22 2015, 02:04 PM)
i think not all earnings are declared as dividends. Therefore sometimes they will dip into retained earnings for propping up the dividends in bad times.
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Yes, when good time, need to retain for rainy day, so that the dividend can be more consistently.
As there were times, equities market may make a loss one.

Eg.
One year make 9%, next year 11%, another year 1%, so a 7% or 6% (save 1% for further) roughly every year can be given out.

The previous decision to invest abroad, now if we see back is a good decision, that manage to hedge against RM depreciation.
cherroy
post Oct 23 2015, 09:02 AM

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QUOTE(plumberly @ Oct 23 2015, 08:35 AM)
Saw this in The Star (Letter to the editor). I was not aware of the change Goh has raised, i.e., 2.5% for the non syariah EPF fund.

True? Or a miss-interpretation of the amendment?
» Click to show Spoiler - click again to hide... «

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The minimum of 2.5% dividend rate has been there for many years, but somehow, some talk it like a new amendment is really puzzling me.

This post has been edited by cherroy: Oct 23 2015, 09:02 AM
cherroy
post Oct 23 2015, 09:15 AM

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QUOTE(plumberly @ Oct 23 2015, 09:06 AM)
2 interpretations on this:

AA
Minimum is 2.5% as in the original clause. So status quo.

BB
Like what Goh said, with non syariah EPF funds, they will give 2.5% only.

My gut feel is AA. But want to confirm and deal with this if it is indeed BB.

Cheerio.
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The statement said minimum 2.5%, but not saying cap at 2.5%.
And the 2.5% minimum clause has been exist for many years, did EPF declare only 2.5%?

If really want to fix or cap at 2.5%, the sentence should be maximum 2.5%.

I don't know it is English class problem of something else. rclxub.gif
cherroy
post Oct 23 2015, 01:09 PM

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QUOTE(nexona88 @ Oct 23 2015, 12:51 PM)
how u know shariah account would get higher dividend than conventional one  icon_rolleyes.gif
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May be someone got crystal ball that we don't have. laugh.gif

The amendment just want to create a syariah compliance account, and investing in Syariah compliance investment. But somehow, all sort of unfounded prediction being made by people who got crystal ball, from give only 2.5% to which is higher or lower.

If the other one is higher, just opt the account to it, as simple as that.

This post has been edited by cherroy: Oct 23 2015, 01:10 PM
cherroy
post Oct 23 2015, 11:35 PM

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QUOTE(Ramjade @ Oct 23 2015, 11:16 PM)
Actually what's wrong with Singapore CPF and their FD? Why are they bring so Stingy? I feel that malaysia's epf is more generous and out banks are pretty generous with FDs
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FD rate is governed OPR of respective country.

When your country or economy has no inflation threat and currency is strong enough, then interest rate can be lowered until zero to stimulate the economy.

Interest rate level is dictated by the economy situation needs or in other word, interest rate is one of most important financial tool to fence off inflation threat by central bank, who control the interest rate level.

CPF doesn't allow contributor to withdraw lump sum, need to have minimum balance in the account so that you don't spend all in once after your withdraw lump sum time.

But if you can't live long enough, then it is your own matter that you can't "enjoy" fully your total hard earned money in your pension account that was saved in your entire working life. tongue.gif


cherroy
post Oct 24 2015, 07:06 AM

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QUOTE(Hansel @ Oct 24 2015, 01:32 AM)
The SGD is strong, making imported goods coming in cheaper. Hence, inflation is controlled. The Monetary Authority of Sgp controls inflation and GDP by adjusting their exchange rate. Their exchange rate is denominated by an index called the S$NEER.

When economic activity slows down, the MAS has to slow down the currency appreciation pace of their SGD, hopefully this will stimulate the economy to run faster.

The days of low interest rate in Sgp is numbered. If you look at the reading of the Sgp Swap Offer Rate (SOR) and the Sgp Interbank Overnight Rate (SIBOR), they have been incaresing for the last few months.
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Not actually, when MAS is easing bias, no chance to raise interest rate.

Sg inflation is zero, instead officially CPI number is at negative territory or deflation.
Deflation? No chance for rate hike.

SIBOR up may because of money outflow which resulted in a more tighter liquidity in inter-bank lending.
As Sgd is sliding against USD, money will pile up to short Sgd vs USD.
While with USD potential hike in interest rate, why put money in SIBOR that has no chance to raise rate?



cherroy
post Oct 26 2015, 08:46 AM

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QUOTE(Hansel @ Oct 25 2015, 11:49 PM)
Tks Will,...Yeah,...I know,... put wherever to maximise gain... But I too practise country allocation, or geography diversification. So,... I must not miss out on Msia, must always put a small portion into this place.
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Yup, very much agreed on this part, country allocation diversification.

Frankly speaking, every country has its own problem as well.
No single country or investment can be said totally "safe".

USD denominated - USD debt fundamental is not pretty to look at.
Aud/NZD - Consistent trade/current account deficit.
Yen/Euro - QE prospect which make the currency at weaker side.

Equities - you never know what could happen in the future, who ever think of Lehman (an investment with so long history) can go under, so do some old famous name stocks that never recover until now.
Somemore today darling/bluechip may be last forever. Whoever think of Motorola, Nokia current faith in phone market 15 years ago.

Bonds - if interest rate rise int he future, bond price dropped.

If look thoroughly, EPF which is less riskier than bond and sitting next to sovereign bond risk (or may be safer as well), and potential able to give 5~6%, it is actually quite an attractive asset for diversification purpose.

So if see EPF from diversification part of asset allocation, it is an good option.

cherroy
post Dec 23 2015, 03:26 PM

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I always taught the legal employment age was 16, as that time I needed to wait until this age (form 3) before can work partime in a company.

Since when it was changed to 14?

This post has been edited by cherroy: Dec 23 2015, 03:26 PM
cherroy
post Dec 23 2015, 03:27 PM

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QUOTE(xuzen @ Dec 23 2015, 03:16 PM)
Nowadays kids make money from:

I) Writing apps and selling it

II) Play games, level up then sell it to 3rd party for a profit

Xuzen
*
added
III) FAMA... sweat.gif
cherroy
post Feb 2 2016, 11:00 AM

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QUOTE(xuzen @ Feb 1 2016, 01:41 PM)
My HR and Accounts department opined to maintain status quo at 11% because:

I) They don't want the extra work to change this and that

II) They said is only a short term thing (21 mths).

III) 3% drop is actually not a lot for low salary. Most of the small wage owner will get less than RM 100 extra in their pocket. For larger wage owner, they don't f3cking care that extra 3% in their pocket.

Xuzen

NB: Point III) is my opinion.
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Your HR cannot decide on behalf employee.
It is employee to initial whether they want to opt 8% or not.

Company by default needs to deduct 8% as stated by gov.

This RM100 not a lot, that RM100 not a lot, end up Rm2100 also not a lot... (21 months). biggrin.gif

Sikit sikit jadi bukit.
There will be a few extra bil of money in the economy, and with multiplying effect, it may mean a few ten of bil extra business out there, don't look down on its effect. smile.gif


cherroy
post Feb 21 2016, 02:35 PM

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QUOTE(nexona88 @ Feb 21 2016, 01:07 PM)
I guess the foreign assets sales help EPF to pay "good" dividend tis round.

Thanks to weaker MYR, they profit quite good
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It doesn't make a difference actually.

Even EPF doesn't sell its overseas asset, those overseas asset valuation also register a gain in their book.

If oversea asset value drops afterwards due to worldwide economy slowing, the sales of asset may be look a shrewd move then especially with low RM valuation currently.

As those asset has enjoyed both front of profit, asset valuation + forex gain.

This post has been edited by cherroy: Feb 21 2016, 02:36 PM
cherroy
post Feb 23 2016, 10:10 AM

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QUOTE(plumberly @ Feb 23 2016, 09:57 AM)
After reading the above, bad news, I said to myself.

but after looking at the article, the 4 billion shortfall is the 11-8=3% reduction in new fund for EPF.

Maybe this is really not bad news as EPF is already too BIG. Ha.
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The bigger the fund is, the more difficult to achieve higher yield return especially in current financial environment.
cherroy
post Apr 27 2016, 10:03 PM

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QUOTE(Hansel @ Apr 27 2016, 08:09 PM)
Wow,..without reading the details, I just can't fathomize why would a GLC want to take-up 80% stake, another few percentages more and the EPF will need to do a mandatory buyout for all the shares of MRCB... might be a bailout here ?
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The deal is about buying a MRCB"s subsidiary company, not MRCB itself, which owned a piece of land.
cherroy
post Feb 16 2019, 05:38 PM

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QUOTE(Krv23490 @ Feb 16 2019, 05:18 PM)
Wa, really ah. So If die without will or epf nomination , funds stuck in EPF?
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You need to get LA from the court based on estate law, which may time consuming as compared those with nomination or Will.
cherroy
post Feb 16 2019, 05:41 PM

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QUOTE(romuluz777 @ Feb 16 2019, 05:38 PM)
Does the EPF nomination take precedence over the latest will ?
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Yes, EPF nomination will hold.
cherroy
post Feb 20 2019, 09:14 AM

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QUOTE(Ancient-XinG- @ Feb 20 2019, 07:39 AM)
Surprise rite... With report mention mainly income from market.

But bursa 2018 return was -3.2%...

How the hell they do that. Lol.

Really magic.
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EPF investment is not 100% in KLCI.

A quarter or up to 1/3 is in MGS and many fixed income instrument.
MGS - roughly 4% yield, so this portion already generated 4% income for them.

KLCI - They do receive dividends from the holding. KLCI Heavyweight like Maybank, CIMB, Petgas, MISC, Digi etc do give generous dividend yield that range from 4 to 5%, so this portion generate them another 4-5%.
Also, they do actively trade in market as well as may appoint 3rd party investment firm to make profit from them.
Sell when market is up time, (typically when foreign investors coming in), and buy back when market plunges.

Subscription of IPO that may also earn them good profit when the IPO goes well.

Investment in Reit - 4~6% yield.

Foreign investment, a quarter is investing abroad, which is generating handsome return for the last few yaers, while the depreciation of RM actually benefiting or boost the foreign investment return.

Basically fixed income instrument set a base income then equities provide extra boost if the market performing well.



cherroy
post Feb 20 2019, 10:18 AM

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QUOTE(Ancient-XinG- @ Feb 20 2019, 09:38 AM)
Nice explanation.

6% to me its really impressive given that EPF does not mention having reserve just like what ASNB did. And having foreign exposure and high EQ exposure can still give 6+ even they said don't expect too much months ago.

So, base on the explanation above, EPF should able to give double digit return IF the market is said to be way better than 2018. But why in 2017, it also giving out 6+? Because 2017, basically anyone can ace in the market.....  confused.gif
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Even if achieved double digit due to favourable market, it should be saved for rainy day.
eg
First year declare 10%, then 2nd year 3%, a lot of people will complain on second year, all sort of bad mouthing, speculation may come out.
While if declare 6.5% consistently for 2 years, then people likely will be satisfied and perception may be difference from earlier example.

So, the board need/always have to view form long term perspective especially this is a pension fund, not ordinary unit trust.

Also, EQ risk may not as high as many perceive if invested into some stable high dividend stocks.
And many high dividend stocks are indeed generate very good return for EPF over the long term, as well as for individual investors.
cherroy
post Feb 20 2019, 02:47 PM

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Most of the time, EPF does pay out most of its income annually.

Can search through EPF annual report.
Under financial statement
Its balance sheet on 2017

Total net asset 817 B
----------------------------
Member's fund
----------------------------
Contribution 768 B
Reserves 41B
Retained profit 3B
----------------------------
Non controlling interests 3B
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