In unit trust, there is no such thing as expensive units.

The returns is relative to the price so with better returns, you yield higher dollar returns.

For me, the selection of fund is primarily:

1. Size of fund. (has to be big in order to move mountains)
2. Markets they are in. Sectors or Vertical markets that they are more focused on. (unfortunately, local funds are more skewed towards certain markets instead of relevant verticals.)

Watch this fund.. Public Growth Fund... it is primed to move some mountains... . I see a lot of potential in this one.

Thanks kingkong81. I think I will go for an agent. Any recommendation?



I think that the power of unit trust also lies in the number of units. Let's take 2 funds for example. One is priced at RM1 and the other at RM0.25. By the end of the 1st year if both funds prices increase by 2 cents. And if the investor invested RM 1000 at the beginning of the year his portfolio will look like this;


fund #1
NAV = RM 1
bought = RM1000
units acquired = 1000

NAV now = RM 1.02
total capital value = 1020

fund #2

NAV = RM 0.25
bought = RM 1000
units acquired = 4000

NAV now = 0.27
total capital value = RM 1080

upon redemption fund #2 will yield 60 bucks more than fund #1

But having said that I still agree with you that even though the prices are higher doesn't mean that the fund cannot increase anymore.

Grengo,
What do you mean by "vertical market"?

Vertical = specialization.

I have indicated that there should be funds tapping on global emerging industries. In my belief that funds now involved in clean energy and renewable energy industry would be my flavour of the day but local funds do not specialize in particular industry. Well, as I am writing PM came up with the retail and consumer market fund which is laudable but hardly the market I am looking into. Maybe could be others cup of tea.. .

---

Added on January 4, 2008, 12:28 pmIn a way your argument is flawed. You will not look at growth in volume but in %.

This post has been edited by Grengo01: Jan 4 2008, 12:28 PM

Your arguement is totally flawed as said by Grengo01

Don't be fooled by the number of unit. A unit trust of 0.25 with 4,000 units while the other with 1.00 with 1,000 unit is the same. No matter they issue or IPO with 0.25 or 1.00, makes no different at all. Just may be make you feel good about 'more units' or price is low (0.25), but in actual fact it makes no different.
It is the % if gain that matter. If both fund performance are the same 0.25 goes up to 0.27 the 1.00 will also goes up to 1.08.
A 1.00 fund doesn't mean it had no room to go. Normally, you won't or seldom see fund to have 2.00 or 3.00 because they like to split/bonus it whenever they make significant gain or fund price appreciate quite a lot which make the unit price become around 1.00.

I think that is one of the main reasons why the funds like to split/bonus/dividend etc to keep the price per unit "low" - the feel-good psychological factor. It makes people want to buy because it is "cheap". It makes no difference to fund value of course, but it can be significant in affecting share prices.

People should not be lulled into it being "cheap" or affordable. After all the first initial investment has to be at least RM500 or RM1k depending. But, what people need to understand is, UT is not stock market. Although the entry price is important as your gain could be 5% less in matter of days, one MUST understand that it is for medium term investment. I deplore agents that advise their client to SELL and re-enter at a later date when price becomes "attractive". This only gives the agent opportunity to make more commission. Instead, it would be wiser for the investor to switch to BOND or Money Market Funds to ride the wave of downswing and switch at the opportune time to take advantage of "lower" prices and sit out till market rebounds.

And to see evident result, UT should be invested in tranche of 10k or more then the returns can be "meatier" LOL. Again, for me since its medium to long term, only my EPF funds are invested in UT, for the past 4 years it has given me more handsome reward than the puny 5% given by EPF... Now my dilemma is my choices of funds are limited.

Sadly to say, a lot of people fall into this kind of 'trap'. (not actually trap, somehow it is marketing trick)
There is also the reason why there are a lot of funds currently issued at Rm0.25 or Rm0.50 rather than Rm1.00 (most in old day time). They DID attract more investors than those RM1.00 although in actually fact it is the same due to the 'feel more or cheap' factor as mentioned.

This post has been edited by cherroy: Jan 4 2008, 03:40 PM

I don't have a problem with this IF the agents can get the timing right. For eg, in 2007 there were 2 big drops - March and August. If an agent had told me to sell in July, and buy again in mid-August, I would have gladly given them double the service charge.

I see. So if both funds increase by the same % then the gains will be exactly the same. Only skill involved is to predict which fund will do better.

So no problem investing in PAGF? Is the redistribution or unit split for PAGF good? Anyone who has invested for quite some time can give example?

IF... interesting... even IF they can.. i would only switch and not exit and re-enter.

My investment in PAGF gave me 40+% in my financial year under review.... I do not care much about the redistribution.. KNN.. coz I am TAXED! I am only interested in the margin that I get.

There are 1 tactic to avoid distribution.

public mutual fund does now give distribution on the same month for every fund.
so get another temporary fund whichś give distrubution on different month, switch to that fund before your main fund going to give distribution,
after that switch back to the fund.

but anyway there are some charge for switching.

Totally agreed, In SG, I used to invest in this Fidelity S. America UT investing in Brazil, Chile, and few other S.A's countries. I once bought HSBC India fund at $5+/unit. My colleagues complain too EXP and bought into some other alternative India fund... few months down the road, the difference was so telling that he started buying into it.

In mid 2006, I bought Fidelity South America fund at US$19.2/unit and my same colleague said EXP too... what is the price today? US40+ and I merely invested SG$2k... There is no such thing as EXPENSIVE here.. only whether they are affordable. Doesn't mean EXP UT don't do well.. You can actually look up POEMS.COM.SG and see the chart for yourself, some of the UT, especially those priced at >$1K/UT and above, some even in US$, their moving rate is much higher. just that, they are mainly for big investor and you have to contact them should you invest. Some are for hedge fund investment if you can afford.

So it lies with preformance of the UT, which is more important.. what unit and low price you can get, don't be decived as I had been told by agent before and had refuted their so call claim...
as for teh arguement on that RM0.25 and RM1 UT comparision.. I personally had not come across that this kind of thing should happen and to me its flawed... what you are referring too is basically performance.. not about the price. If the fund is performing.. regardless of unit price... I will still buy.. WHY? because they make more $$$ for me.. hack about CHEAP UT price....

This post has been edited by bbmars: Jan 4 2008, 11:32 PM

Not an issue for me la.. . Just wanna make some noise... once Mutual Gold no more switching fee ma... sometimes you are just too lazy to switch...

bbmars, interesting statement. I am sure there are not many investors like you and you said it in a nutshell "Its the performance that matters" I always tell friends to always get a copy of the annual report or prospectus to see the fund's investment inclination. That gives you an idea of the fund manager's focus and the stock quality the fund is holding.

What ever funds you invest in, depends on the experience of the trust manager & trustee..

or else how big is the fund also useless..

Trustee is the caretaker for the money invested, but they do not involve directly in the management of the funds. They do have to approve all transactions involving the money that they are holding. It should be the fund managers' experience that count in unit trust

Yup, Trustee had nothing to do with it. As long as fund managers don't cross the line or violate the objective of the funds, trustee will let it be.

hi all! just wanna ask for your kindness to fill up this questionnaire and reply as soon as possible. im new about this topic and doing an assignment on it. objective of this quick survey is to obtain as much data about funds investment in malaysia. thanx for all of ya cooperation!!

Occupation: ___________________ Sex: ________

1. Do you own a trust fund? (If no, proceed to question 9)

Yes No

2. How much did you invest?

Below RM 1,000
RM 1,000 - RM 5,000
Above RM 5,000

3. Why do you invest in a fund?


____________________________________________________________________________________________________________________________________

4. What type of fund do you invest in?

Fixed Balance Growth Others

5. From whom did you hear about this fund?

Friends Relatives Agents Others

6. Which company have you invested in?

Banks Finance Insurance

7. How long did you plan to hold your fund?

Less than 1 year 3 - 5 years
1 - 3 years More than 5 years
More than 10 years Others: _____________

8. How much do you expect in return per year? (proceed to question 14)

Less than RM 1,000 RM 3,000 - RM 5,000
RM 1,000 - RM 3,000 More than RM 5,000

9. Have you heard about fund? From whom?

Friends Agents Others:____________
Relatives Internet

10. Which companies are you interested in?

______________________________________________________________________________________________________________________________________________________________________________________________________

11. Which plan are you interested in?

Fixed Balance Growth Others

12. What benefits do you expect to get from your investment?

______________________________________________________________________________________________________________________________________________________________________________________________________

13. Do you have any suggestions to improve the funds in Malaysia?

______________________________________________________________________________________________________________________________________________________________________________________________________

14. If given an opportunity and a good fund scheme, will you invest in a fund?

Yes No





Thank you for your cooperation.

hi hi hi ... sorry for bothering u guys... new comer here.. wats UT and if i m not mistake ... MF == mutual fund ??

UT is unit trust. The term UT and MF are used inter-changeably.