China's National Team is in the game - kicking all the indices up field.

Will Malaysia's National Team start playing in the last hour? Or already ran out of steam? Still got another 19 bill to shoot or already shoot all?

Please get in the game and don't let small-cap drop 1.5%...

Higher volatility = higher risk = higher reward.

Not easy to make the call; after finding that there was more risk than one can stomach. Which is common enough since investors often think of high returns, and seldom the higher risk of loss.

It is back to square one, the initial decision before getting into any fund: How much volatility/risk should one take?

If switched to another less aggressive fund now, there could be another round of lost opportunity when the market rebounds. Tough choice...since switching into another less aggresive fund could means taking a longer time to recoup the loss.

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Whatever funds to switch into, even the same fund after pulling out temporary; maybe ponder on this investment strategy with a big sum of money:

1. Don't do one-time lump sum investment.
2. Split it into 2 halves, and invest 50% first.
3. Staggered the other 50% over 5 years.
4. If market behaves normally, then invest 10% each year.
5. If market falls sharply, then do following to take advantage of the steep drop:

Market fell by this much; Invest this much.
10% 10%
15% 22%
20% 30%
30% 13%
40% 12.5%
50% 12.5%

Q: What if market drops less than 10%?
A: It is normal and expected in an aggressive and volatile fund. As seen in recent days, funds can easily lost 1% to 3% in a day. If one can't withstand the volatility, then choose a more conservative fund with lower expected returns.

Which ever can give the higher interest. In an urgent event to withdraw money, use credit card first, then withdraw from FD or UT funds (either MM or bond fund) to pay credit card in full.

Me, major portion in Bank Rakyat 1-year FD (4.1%), which is paying interest monthly; and some in CIMB at 1-month FD (3.15%) since I have a CIMB cheque account (which pays 0 interest), and also the cc was issued by CIMB.

Whatever MM or bond fund I'm holding now, was converted from equity funds - with service charge paid. So they are strictly UT play money... cannot touch... so maybe different from another person who has earmarked and directly invested into MM/bond fund (or fixed-price UT) as part of their emergency fund.

I'm expecting all markets to dip further... some people (which could be millions of retali investors in China and Hong Kong and Taiwan and Singapore... and...) will be taking money out of the stock market for CNY to spend and pay back debts, some just to lessen their holdings since going for long CNY holidays and will not be monitoring the market on daily basis.

So it is an STI-indexed fund in ringgit:

STI 52Wk Range: 2,626.81 - 3,549.85, Previous Close: 2,644.57
2644 to peak 3549 = 34.2%

15 Jan 2014 00:00 UTC - 15 Jan 2016 14:07 UTC
SGD/MYR close:3.06978 low:2.51835 high:3.12218

3.07 to low 2.52 = -17.7%

Possible upside: 34.2 - 17.7 = 16.5%.

But it could maybe take 2-3 years for the STI index to touch that peak again, (and in that time, the ringgit could be down to RM2.52/S$1). So 16.5% in 2 years? Good enough?

STI YTD Return: -8.74%
If STI fall another 8.74 in next 2 weeks, then.... can consider.

yup, always recommended 100% in equities; since I believed UT investment is to supplement retirement income; and retirement for most readers here is still decades away.

45 years old - still got at least 20 years to work, earn, save and invest; I know the present retirement age is 60, in 10-15 years time by 2030, I think it will be pushed to 65 as people will not afford to stop work at 60. People who don't save and invest will find it even more difficult to retire... at old age with no job & no money, tough luck as we don't have welfare support.

But why you got mm funds? Part of your 'emergency fund'? Switch out from equity and parking temporary in MM, because you are trading and doing some timing?

Or because you think you have a "big" sum of money invested and too much to lose? First, try to compare it against the regular investments that will be done in the next decades. What is 50k when the final objective is 500k?

Take more risk when you can still afford to take the risk. Don't wait till it is too late to do so.

That's what I had guessed... excess money waiting to follow through on a VA/DCA strategy to plough into an equity fund at the right moment.

Cheers.

a) The worst is yet to come, sell the rally.
b) The worst is nearly over, buy the dip.

Looks like the market sentiment is more towards (a).

HSI, H-Shares (HSCE), and STI have something in common - they have fallen off the cliff and still falling...

"The STI could hit 2,500 by the middle of the year, and that would be a good buy level."
http://www.straitstimes.com/business/compa...nto-bear-market

That was 11 days ago on 8 Jan. Today STI closed at 2,559.77, dropped 78.70 (2.98%).

Could hit 2500 this week? Still good buy level or jumping into quicksand...

========

YTD:
HSCEI -17.03%
HSI -13.82%
STI -11.20%
ASX -8.58%
KLCI -4.35%

In every buy & sell, there is a buyer and seller. To sell, you must be holding something to sell. Whereas to buy, you're looking for a good price to get in.

In an uncertain market situation like this, buyers would rather be cautious and nibble bit by bit in a dip. While sellers will sell whenever there is an opportunity to sell in a rally, since they are holding too much equities and can't exit at once without affecting the price of the remaining equities. Any rally will be cut short.

Nikkei is now sliding downwards... as also observed in the Dow Jones index the past 2 days - open strong, then sliding down.

Crude oil is crashing downwards, and sovereign funds in Kuwait, Qatar, Norway and (also mentioned was) Singapore is selling...

BTW the index to watch is H-shares or rather Hang Seng China Enterprises Index, not the Shanghai composite which is mainly traded by China's local folks. H-shares & HSI was down more than 3% yesterday, and is reflected in the related funds' NAV/price released today.

Shanghai was slightly in the green yesterday & maybe today too... China's National Team is doing their best to keep the market up.

And the guys in CNBC were saying they are selling... that they are hard hit by the low oil price and are running out of money to run their countries, so have to sell (their wallstreet/US stocks) to get some money...

Wallstreet lost 3 trillions this year (or rather in the past 20 calendar days or 12 trading days). No matter how deep is the pocket, all will kecut bola too.





This post has been edited by j.passing.by: Jan 21 2016, 01:30 PM

"Accumulation" is somewhat different from "buy-and-hold".
The latter means buy-and-hold for umpteen years.
The former means buy, buy, buy for umpteen years. DCA method... buying when it is low as well as when it is high.

Maybe this will helps in your timings. Get to know about moving-averages. Be patience, and buy only when the index is below its 200-day ma.

Depending on what category of funds - balanced or equity. The fund manager cannot pull out everything and swing from 100% to 0% as he likes. Only you can pull all out.

What the FM can do is beating the fund's benchmark. He cannot 'cut loss' for every single investor... if investor buys lump-sum when the market is hot, that's the investor's problem, not the FM's.

I'm not sure what dividend payout you're referring to. In a share, yes... indices like KLCI or STI, should be too since they are based on the values/price of the share.

Yes, you can do that - buy all the components of the index accordingly to the weightage of the components, similar to a ETF. Most of the UTs are 'actively managed' - the fund manager is selective and weights each components differently.

As to whether you, as a normal everyday investor, can do better than the fund manager... who knows. This is the reason why there is a market for UT and many fund companies were set-up to service this demand.

Lastly, with a minimal of 1k, you can buy a diversified UT of different shares (usually around 30-70) selected by a professional who has done some analysis of maybe over a hundred or so companies.

How much money would takes to have all shares in a index, I have no idea - don't have direct interest in the share market and not bothered to know more - but I presumed it would be a lot of money. And remember that it is not a one-time-buy-and-hold, but buy, buy, buy on a regular basis... I will have to be loaded with lots of cash to able to 'buy the index' frequently.

What index performance? The first post, me got lost already... if you are trying to introduce a new idea because you know better than the UT industry, then clarify it further...

If the benchmark of the fund is KLCI, than that's the benchmark to compare the fund against. We can also compare similar funds in the same category and compare their performances too.

If you think the growth in the index is too moderate (say KLCI) - that you can easily performed better with better expected returns on your own, that's your decision.

If your expected returns is higher, and you are willing to take the risk, then maybe invest in more aggressive funds, say small-caps. And the benchmark for the fund to beat will be the Small-caps index.

So what were you trying to say? Beating the benchmark is all too easy for the fund manager to do, and the benchmark should be "modified"?

Bear in mind, not all funds performed better than their benchmarks... and beating the benchmark does not mean that the fund has positive returns; both the benchmark and the fund could be down, but the fund is higher and not as negative as its benchmark.

In the fund prospectus, the details of the fund are highlighted including its benchmark... we bought the fund on this expected risks and returns. It is a 'no brainer' that whatever new performance index will be shot down.

A bit more and furthering the previous post on "cut-loss"...

Most equity funds are usually mandated to have 70% to 90% in equities - with 10-30% in cash or other money instruments.

To cut loss, one usually pulls out was remaining. The 'cut-loss' decision was made when there is a foreseeable fall in the near future, maybe tomorrow, next week, or month.

If this is the position that the investor took, that there will be a fall, the rational is to pull out all. No point taking only a portion out - 50% or so, and let the remaining portion taking a hit.

A 10% fall on 50% is a 5% drop, which can be a lot of money to some; as indicated by some posts here of being hit with 2-3% loss.

Only the investor can make this decision to pull his investment 100% out. Not the fund manager who has to keep at least 70% or so in equities.

If taking only a portion out, because we are unsure which postion to take, whether the market will go up or down, this is 'hedging' the bet.

But this decision should have been taken on the very 1st day when getting into any UT investment... how much to invest, how much of savings should be used to buy UT funds each time, does the fund has a good track record that we can still have faith when it performs poorly, etc. etc.

And if the decision is to cut-loss and pull all out, hopefully the investor can predict again when is the right time to get back in.



PS. 2 decisions... what are the chances of getting both right? 50-50? One right, one wrong? Isn't this same as doing nothing?

As said, I already did not get what you were trying to say in your first post; why should I be annoyed?

BTW I was trying to clarify something, which I failed to do, as you were replying to my post and join in the conversation with someting to add on...

As in Kimyee's post, the common moving averages are given in the charts, don't have to keep own data and invent something new.

I'm not big or keen on technical analysis too... but the moving averages are simple indicators. 200-day moving average just means the average point in the past 200 days.

20-day ma means the average in the past 20 days; which is 4 weeks (as there are 5 trading days in a week). The index may moves up/down like a yo-yo, and if it is near to the 20-day ma, this means that in about 10 days in the past 20 days, the index was trading higher, and about 10 days, lower.

Chances of it going up or down tomorrow, 50-50. But some TA will extrapolate the trend line and would says the trend is showing a clear path...


200-days is the longest they have in the charts, not a full year average, but close to it (40 weeks).

Yahoo has one of the best charts... I only selects the 20, 50 and 200 days - these 3 ma. is good enough... Should bookmarked all the usual stock exchange indices and review them daily....

https://sg.finance.yahoo.com/q/ta?t=2y&l=on...c=&s=^KLSE&ql=1

PS. Can also looked into the 5-day or 10-day ma for shorter trends... when the buying decision is more immediate, like this week or next week... say the index closed at 1625 and it is near the 10-day ma, and we choose to enter now, the kiasu concept is that the entry point at the moment is no better than any entry points in the past 10 trading days (or past 2 weeks). At least the money is making money by sleeping in MM the past 2 weeks... But we can't simply let it sleep in MM with lowly gains and not make it work harder... guess the 5, 10 or 20 days ma can make the decision for us.

The fund manager should, and would be doing above on a daily basis... giving different weightage to different funds, and trade accordingly to the fund's investment policy.

My definition of 'cut-loss' is pulling out all completely off the table - 100% in the equities and moving all to cash or MM. Fund manager cannot do this. Only the investor can - by selling the fund.

If the manager cuts loss, he would be defeating the purpose of the fund. Investors bought the fund because they want to have holdings in equities at all times - for the long term. If the fund is to be all in cash or MM, then we would have bought MM funds, and not the FM to make the investment decision for us.

This post has been edited by j.passing.by: Jan 23 2016, 09:30 PM

As the saying goes... don't count the chicken before they are hatch.

As long as the investment were not pulled, the numbers is still alive and kicking... you maybe counting the chicken too soon.

On the other hand, since I not familiar with the funds you're holding... they may just be 'bad' funds. Check Morningstar Malaysia, and see how they performed in comparison to other funds.

http://my.morningstar.com/ap/main/default.aspx