There is such a thing as GIGO - garbage in, garbage out.
The extreme numbers broke the function! Try changing the 'time value' from 1/1/2015 to any date, and the XIRR remains the same...

Here's the logic on what the numbers are saying:
$10 gains on $10 invested is ROI 100%, and since the time period is 1 year, the IRR (or CAGR) is also 100%.
$1000 lost on $20,000 is -5% ROI, and since the time period is 1 day, the CAGR is -100%.

The projected lost (in one year) is very close to 100%, since if we lose 5% a day, we will lose NEARLY all in several weeks. We can't lose more than $20,000 (or in other words, less than -100%), because the maths is not a simple 'minus' ie. 20k - 1k - 1k - 1k ... but 20k x 95% x 95% x 95%....

Even if we lost 10% a day, which is $2000, the projected lost will still be capped at -100%.

Putting the 2 investments of 'extreme' figures and dates together into the XIRR function, it resulted in a confusing/misleading IRR of 0%.

But using cow sense and being aware of GIGO, any reasonable investor would ignore the initial $10, and think and calculate solely on the $20,000...

No matter how it is viewed, any recommendation, portfolio model and/or recommended fund is for sake of marketing. Nothing more, nothing less. So take the recommendation with a pinch of salt. If it suits you, buy. If not, just ignore.

Never take for granted it, the recommended fund, is the best or better fund with the best or better returns in the projected short/long term. Do remember it is all marketing stuff.

Another thing I'm septic is forecasts on a specific country or region and how well they will be doing in future - hence the portfolio need to diversify 'geographically'.

But had you ever wonder how will it relate to the UT fund while the gloss is solely on the country?

Or is it simply that the fund's name has "India", "China", "Asia Pacific" or whatever, and that means the "Timbuktu" fund will grow in pace with the "Timbuktu" country while the local fund guy know nuts about "Timbuktu"?

Okay, you may say the fund is well diversify among the targeted category of companies in "Timbuktu" stock exchange. So if Timbuktu's index do well, the fund will also do well.

But it may still be missing the extra oomph that a local fund guy can produce in a local fund in the local homeground stock exchange.

(My 2 cents 'proven' by above dexk's post.... )

wow... stated 2 weeks? And in the meantime, not able to sell or buy... this is like asking FD depositors to wait 2 months...

Wall Street Gives Up on India Funds as JPMorgan Joins Exodus.

http://www.bloomberg.com/news/articles/201...an-joins-exodus

"For JPMorgan Chase & Co. and other global firms vying for a share of India’s mutual-fund industry, the world’s fastest-growing major economy has been a land of missed opportunity.

JPMorgan is joining the likes of Goldman Sachs Group Inc., Morgan Stanley and Deutsche Bank AG in exiting India’s 13.5 trillion rupees ($204 billion) mutual-fund market, the seventh international manager to leave in the past three years...."


The alternate headline would be "Local Managers Whipped Wall Street."

"Time..." Sorry, no crystal ball.

The post was in support of a recent post on performance of funds vs economic performance of a specific country.

That bloomberg article puts the blame on "risk-adverse" of local Indians (ie. no market demand) and red tape.

(Really? Their targetted customers is the local Indians, not Americans? Just like saying any "India Fund" sold here...)

If the issue is digged deeper, it could boils down to no demand for their funds as their investors were pulling out due to poor fund performance, ie. the foreign fund houses not able to make money and good acceptable returns in local markets...

Some P-M agent/UTC must have misrepresented himself to you. LOL.

Depends on how lucky you are. Average person usually gain or loss 50/50 most of the time. This is the reason why people do DCA (dollar cost averaging). It is not wise to buy-and-hold for a number of years, say 5-20 years. With DCA, it is buy-buy-buy regularly throughout the 5-20 years.

TQ for the comment; saves me data and time to open and read the link.

We are targetted audience and most of the time, it is all sales pitch... articles in FSM are no difference. Some of them may sound neutral, but I still read them cautiously; and usually they are repeats (after reading these 'financial' articles for months and years) - as how much (correct) info can one have regarding UTs.

Well, what news is really truly related to UT investment? None - if the investment objective is for the long term. Some may want to "speculate"... and some may choose not to.

I read them for general info and entertainment - so it don't have to be easy to digest, as this means nothing new and boring!

PS. Pls don't call me 'boss' - else newbie would think I'm a moderator, or an expert. I'm just an investor sharing some experience (sometimes) and 2 cents bs (usually).


This post has been edited by j.passing.by: Apr 20 2016, 02:28 PM

okay, I just opened and read the link in your previous post, just to understand where you're coming from on 'asset allocation'. And it is a waste of time! The text in the article is too general; the graphics - only worth a fast glance as it is the opinion of the writer. Invest in gold to diversify, not exactly my cup of tea.

Did not read it further - because it is too formulate - with set percentages for this and that; and from my past experience, any set formulas do not work, otherwise everyone would be working and living to a set rule of formulas... "must have x% in insurance, medical card, gold etc etc" - which is totally crap, and it is all sales pitch to convice us to priortise certain products and buy them over other products.

My understanding of 'asset allocation' is simple - it is diversifying a pool of mutual funds by having them in:
a) various geography (various country-specific and regional funds); and
b) various categories (ie. money-market funds, bond funds, and equity funds - which is further sub-catergorised into small & mid cap funds, large cap funds and specific sectors like real estate, mining & oil, etc etc.)

And if you have read my earlier postings in the Public Mutual thread and also here on stages of investment tied to 3 different age groups, my 2 cents opinion is that asset allocation by mm/bond/equity ratio is closely associated to age groups. The younger we are, the more risk we should take.

So I differ from you in that market direction or trend has no bearings on asset allocation - which was already pre-determined by us based on our age group, future earnings, and risk-appetite.

To update or change it every so often accordingly to market trends (a viewpoint that is usually set by our own prejudice in accepting only 'forecasts', out of many differing forecasts, that concur to our wishful thoughts)... does not seem to me a refined investment strategy.

Maybe suitable for a hit-and-run strategy for the short term of several weeks or months... to time and gain from market insight. But only if the total portfolio is quite substantial and a willingness to risk a major portion of the portfolio.

And this hit-and-run allocation can only happens if one have less than 100% in equities... in the latter age groups...

This post has been edited by j.passing.by: Apr 21 2016, 01:20 AM

To add further... the most misunderstood issue regarding UT is these annual fees; and partly the misinformation was due to the undue prominence of the fees stated in the prospectus, and also due to big fund companies in USA that hype on their very low annual fees.

The undue attention was also spread by newbies and misinformed folks parroting and/or comparing the fees during their short listing of UT funds to invest.

The annual management and trustee fees have to be stated in the prospectus because of regulations. How important are they to investors? None and immaterial. What is relevant to the investor is the possible returns.

For example, when placing money into fixed deposits, the consideration is on the rate of interest, be it 3.6% or 4.2%; nothing else. No one care how, where and what the banks do with the deposits. For all we know, the banks could be making obscenely huge profits from our deposits and trimming off 4 or 6 or 10% before giving out the 3.6%.

The post is in plain English. If you're not trolling and need any further clarification, point out the part you are confused with. Better still reply and discuss what you know and understand - whether it is right or not, this is what this forum is about - discussion.

Yes, that's correct. Just like buying gold, nothing happens till we sell the gold. How high was the peak price is not relevant any more - all paper gains. And in the same respect, how low was the bottom price is not relevant any more - paper lost.

The actual gains (or lost) is when it was sold at the price it was sold.

Not sure why they say "bid-to-bid prices" when the "NAV/unit" is the more common term. NAV/unit is Net Asset Value per unit, or in short unit price.

As mentioned above, the unit price is not only affected by market movement, but can change due to unit splits and distribution income when the distributed income is reinvested into more units. More units for the same net asset value, hence the unit price changes (drops).

So unlike gold, we can't simply look at the unit price and calculate the gain/lost from the differences between the initial price and the current price.

So if there is any charts solely on the movement of the unit price, I would choose to ignore it, and look at charts that show the performance in % returns. I would still be cautious on the accuracy of the chart in % returns especially if it is done by a blogger or 3rd-party unless the data and info was supplied to them by the fund house.

Because the unit price after an income distribution is affected by the extra reinvested units as well as the daily price movement. So it is not easy to figure out the actual gain/loss without any info by the fund house itself.

So back to the question on how reliable is the figures... well, they should be accurate as the figures are usually taken from monthly/quarterly/annual reports released by the fund houses.

Hero or Zero... the verdict is still out.

There is no right or wrong way to invest... if you're feeling you are born lucky and willing to take the risk, then by all means plunge in and speculate... don't let others deter you from making some fast money. Let them look in envy when the market crashes 20%.

I would only give my 2 cents that we should not forget the initial financial objective that was set. If the objective was to speculate for fast returns, then don't change it mid way to buy-and-hold. Use the hit-and-run method as said by someone when we were in Genting.

Me: "We have several hours to play till the early morning."
Pro: "Why set the clock? You want to gamble to kill time or gamble to win?"
Me: "huh???"
Pro: "If win big, run lah! Why still want to continue, for entertainment, is it?"

============

And with almost zero sales charge (and zero exit fee), perfect platform to speculate and buy and sell... maybe better than switching to and fro from mm funds without bothering to check whether there is any switching fee or not.

odor ???

Best to read the FAQs in their website; as FSM is a platform of many fund houses with different fees and rules... which can also change from time to time... pointless for anyone to make any off the cuff remarks or regugitate info learnt previously.

Sometimes things are easier to understand if we are doing it - in this case, having bought some UTs several times and monitoring them, then just asking blank questions academically... as there are no incentives to answer things too correctly!

3 different replies from 3 persons...

The 1st one: What he tried to say is buy when the price of the funds drop, not due to distribution but due to adverse market condition. Yes, I do agreed too... but you and me as regular investors (while he is not) know that is obviously easier said than done; and we are interested to know how much MORE to buy at the right time to get the extra edge.

The 2nd one: It is a non answer and a red herring... If we solely looks at the price and average cost of the units, it is looking directly at the NAV price to determine the decision to buy or not - which we should NOT. This would be the same as comparing 2 different funds, and determine which fund to select based on the lower NAV price.

The 3rd one: This one you should read it again, and think more carefully and thoroughly... this is something new that was being posted for the 1st time in this and previous threads... and what I suspected was happening in funds having "discretionary" distribution yet making unexpected distribution at irregular dates - to provide some cash to investors who opt not to reinvest the distributions, but don't want to be construed as selling their units.

===============

If you want more than just regular monthly input on a DCA (dollar cost average) basis, another method is VA (value averaging).

Read more about VA... contrary to popular misunderstanding, it is a bit more than just average cost of units. In short, VA is determining how much more (or less) ringgit should be invested each time; and it is not based solely on the NAV price, but based on the amount you are currently holding to determine how much to top up.

This post has been edited by j.passing.by: May 22 2016, 04:43 AM

They do have merits - especially after getting burnt, roasted and goreng.

Looking forward to day the when UT funds can be sold across borders among Asean countries. Read that this is in the works quite some time ago...

Would be nice to have Thai and Vietnam equity funds offered by Thai/Vietnam fund companies and fund managers with local insights into their local stock exchanges.

okay, this is out of topic, and a thought to share with you guys who are all familar with IRR and what it means...

This news on how lucrative the Ah Longs business are...
http://www.thestar.com.my/news/nation/2016...-in-their-debt/

"... at interest rates of 0.5-1% per day which works up to 15% to 30% monthly."

Let's think out of the box here... this is good business as there is a market... which should attract new entrants.

More entrants => more competition => consumer gets better services at better rates.

===> BNM should allow more money lending licenses to more new entrants into this lucrative industry.

How lucractive is it, even if giving a very reasonable deal to the borrower?

Let's say the offer is:
a) consumer borrows RM5000.
b) pays back 10% each month.
c) pays back in 12 months.
d) based on flat rate of 18% per annum.
e) 5000 x 118% / 12 months = RM491.70/mth.

Sales pitch: "Borrow RM5000. Pays back RM500 per month."

This is how it looks if put into Excel...
(RM100 deducted from the loan money as admin charges, and monthly payment rounded to RM500 to includes service and admin fees.)

01-01-2016 -4900
31-01-2016 500
29-02-2016 500
31-03-2016 500
30-04-2016 500
31-05-2016 500
30-06-2016 500
31-07-2016 500
31-08-2016 500
30-09-2016 500
31-10-2016 500
30-11-2016 500
31-12-2016 500

And the IRR is 47.3%.

This is better than the returns from UT, no?

Crowd funding to be money-lender....

hire killer cost 60k... so don't take on too much risk to be so serious die-die must get back the loan; keep it to the max of several thousands, and network it nationwide spreading the risk to the minimal.

From the news, the market (borrowers) can pay and willing to pay... just that the deal is so bad that the borrowers are forever paying the interest only.

We can't stop people from taking loans, might as well create more avernues for them to borrow... and to compete against the Ah Longs... call it public service or none-profit-business or whatever it be. (And the person-in-charge creams off a high 5-figure salary.)

If the 760 payment is for 12 months on an investment of 4200, that's a IRR of 416%.

Everyone will be abandoning their UT units... fund houses will go empty... fund managers out of jobs...

===========

Btw the previous posts are just out-of-the-box thinking... if anyone actually makes it happen, please don't give me any credit... don't want any tai kor putting a bounty on my head for spoiling their rice bowl.