The best way to invest in UT is dollar cost averaging. It works with all type of funds. Guaranteed gain over time. Most ppl loss money in UT because they invest in one lump sum. Time the market is a fools game, even foolish for UT. Its also not recomend to hold too many funds as single fund has enough diversification. Less fund is easier for cost dollar averaging.

This post has been edited by Singh_Kalan: Nov 17 2017, 09:13 AM

When you invest in a lump sum, RM36k is locked for 10 years, whereas with dollar cost averaging, you only invest a fixed amount of RM300 every month over 10 years.
For the sake of fair comparison, the rest of the money for DCA should be put in a risk free investment (eg FD) while waiting to be invested on UT.
So..the chart doesn't provide a fair comparison and its abit misleading.

This post has been edited by Singh_Kalan: Nov 18 2017, 12:48 AM

Actually with the FD interest (assuming at 3.2%) invested back into UT monthly DCA, you can afford to invest RM350 instead of RM300 per month. That will make a lot of different over 10 years. But still I think LSI will always have a better return in an up trend. Things is you will never know whether you are at the peak or the bottom until its too late.

The chart and explanation doesnt provide fair comparison thus is misleading. Its not about LSI outperformed DCA.

I didnt say all...i said most, thus its not 100%

This post has been edited by Singh_Kalan: Nov 18 2017, 02:21 AM

Using the chart to prove that LSI is better than DCA is very misleading and contain serious flaw in real world example.
1. Unfair comparison in term of performance as explained in my earlier post.
2. There are thousand of other funds out there that performed differently from FBM KLCI.
3. In real world, when we talk about LSI over a period of 10 years (that is a very long time), we are talking about a few lump sum investment. A normal working adult will not have that much sum of money to invest in one go unless he hit a lottery or inheritance which is rare.

Example of a real world Lump sump investment of RM 36k over 10 year
Year 0 - RM 6k
Year 2 - RM 8k
Year 4 - RM 6k
Year 6 - RM 6k
Year 8 - RM 5k
Year 9 - RM 5k

This is a real world case using LSI over 10 year period. The result will be very much different from the chart.

Comparing LSI to DCA using one lump sum investment from start over a period of 10 year is very smart but its misleading.
I believed most UT consultant would like you to invest in one lump sum so that they can earned the commission earlier.

I do not say that DCA will outperformed LSI over 10 years time, it all depends on the timing and type of funds. Do not based all your assumption on the past result of a single fund. Bear in mind there are thousand of funds out there that performed differently.

With the same fund (eg FMB KLCI), I can choose a different period of historical 10 year (eg Jan 1997 - Jan 2007) duration that proof DCA can outperformed LSI by a wide margin. But that is not the point cause I m not comparing the performance of which method used. I just say those that loss money in UT most likely invest in one lump sum. There are those that profited from LSI, I m not referring to those group of investor.

The way LSI is being illustrated (with initial one lump investment for the whole 10 year) in the chart is flaw & misleading. Majority of LSI investor won't invest that way. Instead they will invest few lump sum over 10 years period. Do you agree with me ??

I m not going to comment on those report by Vanguard and others UT provider.. I believe its biased and does not tell the whole story.

Most UT consultant/company prefer lump sum commission instead of small commission over time. That is their motivation to promote LSI.

This post has been edited by Singh_Kalan: Nov 18 2017, 03:39 PM