Cybermaster,

You told us that your NAV dropped and you have been in the UTF market for one year thereabout.

Please note that in Q1-Y2016, all indices were affected. Not one was spared. So no matter where you put your money, it would have wiped out your gain in that one year.

That is the nature of investing and time and time again investment professionals and gurus always say that investment gain is due to the "time spent in the market" and not timing the market.

For example, for those who invested since 2013, their NAV should hold up quite well.

If I were to be able to peek at WMK's portfolio whom has been investing in UTF > 10 years, I am sure his NAV is still very much positive right? Paging WMK!

Xuzen

This post has been edited by xuzen: Apr 23 2016, 11:14 AM

Investors in Malaysia do not know how lucky they are....

When world market takes a tumble, the fund managers comes into Malaysia to take a breather, some form of R&R for their funds under management.

When world market start to rally, the fund manager knows that when they sell back the Malaysian stocks, the local big boys i.e., KWAP, KWSP, LTAT, LTH, Khazanah, PNB will all come and support the local bourse.

Xuzen

Why you mati-mati want to go RHB? Eastspring tarak switching charge, AM asset management tarak, CIMB principle tarak, Affin-Hwang tarak.....

Use your power of consumer: boycott! It is not like they are the only UTMC around.

Xuzen

So, which bond fund you are looking at? Lai lai... come come with me go look at Libra Asnita Bond.

Xuzen

Let's see:
RHB IBF:

i) Got switching fee of RM 25.00

ii) Got exit fee of 1%

Other than that is ok. Since I am a tactical player, I do not like point (ii).

Xuzen

I look at point (iii). Usually UTF is benchmark hugging. When its benchmark goes up, it follows and vice-versa. When market goes up, it is easy for the UTF to go up and we all think that the FM is awesome / great / guru etc.

But the real skill is when market goes down such as time like this. Then you will really know which FM-UTF is really skillful.

Xuzen

Your point above brought to my mind something about asset allocation. I am your typical Malaysian (unker mindset). Meaning I do not have a Panama account or UHNW private banking facilities at BVI or Cayman's.

I do not own a big RM 6 Million villa or expensive cars. I work for a salary, own one MyVI, and a Honda City. One old one storey bungalow house (passed down from parent) for own domicile and an old shop for rental (also passed down from parents).

1) Notwithstanding the above, a substantial portion of my wealth is locked up in KWSP. And I know that KWSP major holding is in Malaysia Govt Bond and Large Cap Malaysian Blue Chip stocks. Therefore it is quite logical to think that my wealth is exposed to the asset described as above. As such, when I participate in KWSP-MIS program, it is therefore logical for me to choose UTF that is exposed to small and mid cap. And for fixed income portion I choose UTF that are exposed to Malaysian corporate bonds to give an even more diversified portfolio.

2) For PRS, I participate in Affin-Hwang Moderate fund. This PRS fund is Asia-Pac ex Japan exposed. Therefore when I buy cash UTF, I avoid Affin-Hwang UTFs as to avoid having duplicating holding.

3) This leaves me with gaps in the developed market (US, Eurozone, JP), Properties and Commodities. As such, for Developed market, I choose GTF as proxy to access Developed Market. For properties, I am still looking for a good REIT to invest (considering Manulife Asia-Pac REIT fund). Whereas for Commodities, I will stay at the sideline first as this asset class has been performing very badly these days.

4) I do not consider forex or holding paper currency as a proper asset class. Currency to me are just paper. They have no intrinsic value.

The above are an example of proper asset allocation.

Xuzen

This post has been edited by xuzen: Apr 27 2016, 11:12 AM

True, true also.

I do not see UTF as a means to become rich. I see it as a vehicle to preserve wealth and to beat inflation.

Xuzen

See! See how illogical investors are! 1MDB is a bond default issue; and this cause equities to tumble.

Xuzen

The power of social media!

Xuzen

Ponzi 2.0? Apa itu Ponzi 2.0..... ? Two mths ago forget liao lor.

Xuzen

Small cap / growth stock for 50 year old is like trying to find a V1RG1N PR0ST1TUT3. Good luck to you.

Xuzen

ALL! Sacked the fund manager liao.

All at a click of a button, I can sack my fund manager. Amazing isn't it?

Xuzen

This post has been edited by xuzen: May 9 2016, 12:55 PM

Great! You have been paying attention!

Xuzen

Looks ok to me. In times of volatility such as now, a greater exposure to fixed income instruments such as bond, REITs and dividend yielding stocks will outperform growth stocks.

Funny this fund is never in my radar, perhaps its risk rating of 10 automatically algozen™ discard it. But looking at its three year average volatility, its risk rating should not be classify as ten. Strange why does FSM classify it as risk rating of ten (very high risk).

Xuzen

To be fair to Ponzi 2.0, the fund is down because of systemic effect. In simple English, it is a regional effect. Take a look at the Asia-Pac ex-Japan UTF, everyone of them is in the red YTD. The average performance for this region is -6.03% YTD and Ponzi 2.0 YTD is -5.75% which is in line with average.

*** All info is obtained from FSM website.

Xuzen

Sir, no offence, none so ever... it is an enjoyment actually for me to share and discuss about investment with like minded people. Just do not expect UTF to be a Skim Cepat Kaya and you will be fine.

However, it need to be said that it is not fair to disparage Ponzi 2.0 individually when it is a regional effect. That's all.

Xuzen

YTD ROI is 5X.XX%

Volatility is 38.XX%

Scary roller-coster UTF. Need to have a ball of steel to masuk. Purely only useful for speculative fund fun.

Xuzen

In lay-person term:

Lets say you put in RM 1,000.00 into this UTF 3 years ago. Today your return would we RM 1,174.24. This is assuming you did nothing and just let the fund ride the market.

But during that period of time you invested (3 years), for up to two years your UTF would have swung from RM 2,628.07(euphoria) and down to RM 389.00(depression).

The remaining 1 year, it could have gone anywhere between RM 5,000 or drop to below RM 400.00

This type of fund is darn good for gambling and syiok-sendiri play! When it hits the high, you get a the syiok / euphoric feeling, like now. But when it goes kaput! You have to have the stomach to endure it.

If you do nothing, you just switch off your computer and come back again three years later and switch on your computer, this UTF NAV would be RM 1174.24. Isn't this fund sucks?

For professional investors, we try to avoid funds like this because it is darn hard to predict when is the good time or bad time. We may be lucky once in a while, but over a long run luck may not always be on our side.

Xuzen

From FSM website:

volatility of 32.5%, 3 year CAGR is 5.5%; therefore there are 67% chance of it fluctuate between 5.5 + 32.5 = 38% and 5.5 - 32.5 = -27%. 67% is similar to 2/3 of the time, therefore in three years tracking a total of 2 years it will fluctuate between +38% and -27%.

The remaining 1 year period it will fluctuate 2 SD i.e., 5.5 + 2x32.5 = 70.5% and -59.5%. Now put these figure into your HP-12C and redo the calculation. Now padawan go back and do more revision on your CFA level two BOK materials :

Xuzen

This post has been edited by xuzen: May 16 2016, 10:22 PM