From what I understood, those non-local funds need to compute in the currency exchange rate to ringgit... based on the exchange rate quoted by Bloomberg at a fixed time daily, at 4.00pm - London time - which is midnight in KL. Hence, nav prices of China/HK and Aussie funds are still released the next day eventhough their stock exchanges closes earlier or same time as KL bursa.

For pure local funds that only involved local equities, if the fund house is really 'rajin', the nav prices can be computed almost immediately after bursa closes and updated the same day after office hours.

It is easier to see the compounding effect in savings and other financial tools that give continuous growth. To be clear, compounding simply means not taking out the interest or growth. Hence, in FD, it simply means leaving the interest together with the principal for another year.

Similarly, in variable priced UT, there is compounding effect too if its growth is not trim. But of course, it is harder to see this effect since equity funds are volatile and can be having a negative growth as well as positive.

CAGR and IRR are just measurements - giving the same thing, which is the effective rate or annualised rate. Similarly in step up FD rates with different interest rates every month, the effective rate is the actual rate of return at the end of the FD tenure.

CAGR usually means the effective rate of a transaction, ie. a single purchase of a UT fund. While IRR usually means the effective rate of a bunch of purchases, bought at different times.

Check out the simple CAGR formula to calculate the effective or annualised rate. As you can see, when the purchase is held more than a year, its effective rate is not simply derived by dividing the ROI% by the number of years.

Similarly, when there is more than one purchases of the same fund or various funds, with each having a different CAGR rate, we cannot simply added up the CAGR rates and then divided it by the number of purchases to get the effective rate or IRR.

The formula to calculate the IRR is a bit more complicated than the simple CAGR formula. But this is easily done by using a Excel speadsheet, and its XIRR function.

This post has been edited by j.passing.by: Jan 31 2017, 07:05 PM

Not quite correct. What if B gets a ROI of 5% in one year? Is it equal to A's 10% in 2 years?

The effective rate or annualised rate or CAGR rate of A's 10% in 2 years is:

[(1100/1000) ^ (1/2) ] - 1 = 0.0488 or 4.88%

Just by comparing the numbers, it's obvious 5% is higher than 4.88%.

But is that the whole story or the end of the story? Can B maintain the 5% growth next year?

Similarly to the recent posts on switching from one fund to another based on events... to catch better performance... not end of story yet.

Nothing is meaningless... just how you view the subject. ROI is returns on investment. Nothing more, nothing less.

IRR is the effectvie rate. Nothing more, nothing less. It is simply a measurement to make apple-to-apple comparisons between various investments.

If you can get it right most of the time, its not a measly 1-2% gain. Almost every months in a year, there are funds gainiings 2-5% easily. Get it right 10 out of 12 months, you looking at not less than 20-50% gains.

In about 2 months out of 12, all funds goes down, so no matter which fund you jump in, you will inccur lost. This is when you should stay out, putting the money in money-market funds.

With zero switching fees, this is better than having a wrap account, where you need to pay AUM fee.

If you managed to get the timing right, you gained a huge edge over passive investors. Since UT is a pool of funds, of course passive investors will not like those who trades frequently - since they provide the support and foundation to the fund, while frequent traders gets the advantage over them.

I doubt you are only frequent trader or among the first to do trading. There could be many frequent traders, and successful too.

But they are also smart lah to keep quiet and not share their success stories. Else everyone will start doiing trading too... which will cause havoc to the fund... like all go in one fund, and all pull out together... surely the fund manager will have headage to control his cash flow, and will need to sell and buy equites accordingly to the traders' tempo.

Then they (the fund company) will impose rules like charging a switching fee if it is withing 90 days, switching fee of 0.75% on the amount switched, or limit free switching to a number of times per year instead of unlimitless free switching. (All of these rules can be found in older fund companies like Public Mutual.)

So do some trading while it is still free.

This post has been edited by j.passing.by: Feb 1 2017, 05:35 PM

No pain, no gain.

The main point is that it is free switching. Don't have to input other factors, like how much it would cost to do any trading, how much is the minimun amount to switch to breakeven, etc. etc. The only input is the "market" or index. And only need to speculate on it and how it will be for the next 2-3 weeks.

As in all speculations, you don't need to bet your entire fortune into the gamble. But when betting small, win small. So it depends on how greedy you are and how willing you want to take the risk to win big.

Most of the time, people go broke because they thought they have a fail-proof system. They first do it on paper or in small sums over a long trial period, then go big when they thought they have fine tune and perfected their system.

Then wham! What they expected to happen, did not happen.

Actually, there is. It's called 'disttribution equalisation'. Am not very clear how it works, but investors who held the fund longer is given this 'equalisation'.

You might not see this since your account under FSM is lump into one nominee account.

This works until the next distribution... where the extra units will screwed up the nav pricing.

So you are tracking the performance for a short time. Which begs the question why bother to do so especially when the switch and investment is for the long term.

It's given fact that both the funds (the old one and the new one) will be moving up and down, and would criss-cross each other in the short term.

In the longer term, performance charts are available to see which fund performs better.

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Anyway, if you are using Excel spreadsheet to track and monitor the UT funds, and if you feel it is important to keep track of old purchases/funds that were switched or sold, you can easily moved the details to another tab.

I have 3 tabs. One tab on the current portfolio of funds - which I consider it as the main tab. Another for the switched out or sold funds.

The 3rd tab is holding the details of the money pumped in. Dates and amounts pumped in. Together with the current date and the current value of the portfolio, the IRR of the portfolio since day 1 can be calculated.

Sometimes it is easier to build a file from scratch, than using another person's file as a template.

If you do know some Excel, it is more simpler to make you own file instead of wasting time to review and check everything in another person's file.

I learned Excel by poking around here and there... started with the basic data or details neccessary to form the file.

Then, manually copy and paste the current NAV prices to update file - fund by fund...

Then by adding in another tab and copy (manually) all the fund prices found in the webpage into the tab, and linking the fund's price to the right nav price in the new tab. (Only need to copy and paste once, instead of copy and paste fund by fund.)

Then learned a bit about importing data from the webpage instead of opening the webpage and copy and paste manually the prices.

Voila, now can update the nav prices within a second...by pressing 2 keys, Alt+F5.

ROI and CAGR: both can be calculated line by line (purchase by purchase), and displayed on each line.
IRR: Using the XIRR function. This is like a summary of all the purchases.

Example:

Date1, Fundxxx, Amount-Paid, Units, Nav-Price, CurrentValue, RoiAmount, ROI%, CAGR
Date2, Fundxxx, Amount-Paid, Units, Nav-Price, CurrentValue, RoiAmount, ROI%, CAGR
Date3, Fundxxx, Amount-Paid, Units, Nav-Price, CurrentValue, RoiAmount, ROI%, CAGR

TotalValue = ???
TotalRoi = ???
IRR= ???

----------
- put in the appropriate formulas for CurrentValue, RoiAmount, ROI% and CAGR.

- put the necessary fields for the XIRR function out of sight on the far right of the spreadsheet.
The necessary fields for the XIRR function:
Date1, (Amount-Paid)
Date2, (Amount-Paid)
Date3, (Amount-Paid)
CurrentDate, TotalValue

Note: The amount-paid is in negative.

Maybe you don't remember... but we were talking about this several years ago on updating the nav prices by copy and paste... and then Wong Sifu said something about import data. I took the initiative to learn something new, while you come here to read for entertainment?

Okay... just pulling your leg...

Open and create a new excel file... to try out following:

- Under the "Data" pull-down menu, click the "From Web" icon to get external data from web.
- A small window opens.
- In the new window: copy and paste the address of the webpage you want into the address field, and then click the 'Go' button.

- the webpage (if the address is correct) will open. Now play around and click the section(s) you want to copy and import.
- click the 'import' button.
- Done.

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poke around the "small new window"... see the "Options" in its menu?... open it, and then select Formatting: None.

==========

When you want to update and refresh the data, move the cursor to any part of the imported section and press Alt+F5.

So far, I only imports from one webpage. This should work the same if there are several webpages. Just move the cursor to the appropriate section, and press Alt-F5.

This post has been edited by j.passing.by: Feb 5 2017, 05:26 PM

yes, give it try... trial and error style.

There may be some problems in opening certain webpages - depends on what edition is your excel software. So far, I used it in simple webpages, like the pricelist of Public Mutual.

If cannot get the "import" to work, then no choice la... open webpage, then copy and paste.

But the main points of building up the excel page on your own still stands. Else you will still be asking simple things like "how to add new fund" into the file....

Cheers.

This post has been edited by j.passing.by: Feb 5 2017, 06:44 PM

Good! Same as what I am doing. My file has multiple sheets too... just that I call them tabs.

Copy or import the whole price list into one tab, and each individual nav price in the main tab will be auto-updated too, because of the links in the appropriate cells.

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Here's another trick... just to verify that the nav price is linked correctly, since the price list might changed and hence linking to another fund instead.

The main tab or sheet has data as below:
Date1, Fundxxx, AmountPaid, Units, NavPrice, CurrentValue, RoiAmount, ROI%, CAGR

On the same row, off-screen on the right side, I have also:

PriceDate, Fundname, NavPrice, Change, Change%

- I don't link the above cell containing the NavPrice directly to the price list.
- I link it to that NavPrice cell at the far right.
- Hence if the link got messed up, the FundName will also show the wrong fund.

When I scroll to the right, I can see the daily changes too.