cktwai,

1) I had provided a URL about how a portfolio beat S&P 500 index for 7 years. See first quote.

2) As part of the service provided by Vanguard to A/C holder, your portfolio is analyzed using 60 years worth of data. The problem is I cannot show that information without revealing too much of my personal data.

The service is called "Portfolio Watch". You can google "Portfolio Watch" and Vanguard to get more information. You probably can do the same thing with morningstar.

<<This is his thread so why each of your post is like challenging his views and what HE thinks is right. >>

3) I have NO PROBLEM that he challenges my view in this thread. I can be wrong. But, so far, I think he does not know the basic about Modern Portfolio Theory and Asset Allocation Model very well.

Dreamer

WHOOA.. man.. dreamer, you just gave away the secret to backdoor investing in US.
You all need to read a few post up see 'em.

Yes, anybody in Malaysia actually can open account with a brokerage firm in US and you can even buy great stocks like GOOG, AAPL, IBM, etc. or Mutual Funds of your choice.

Also, BN kept a very close eye on how much money you're transmitting out of the country, just don't do it in one lump sum (<RM10K per transac).

As non-residents, you'll be subject to withholding or have to pay US taxes as non-resident (1040-NR), the capital gains as not subject to tax because you'll be doing arm-chair trading using your computer from Malaysia.

This post has been edited by netfan: Jul 17 2007, 10:19 AM

theres only couple of blue chip stock in Malaysia can buy, for eg : Telekom, Tenaga, Calsberg, Pos Malaysia, TOTO, Magnum, Bernas.. thats all i know.

I dont think you hit Dreamer's favourite. You said couple but got 'n' examples?
But Tenaga is the one that will make profit even how bad the market is, but it is prone to oil price.

A lot of people don't realise Tenaga currently buying natural gas from Petronas at a huge subisidy/discount compared to market price. Without the indirect subsidy from the Petronas, Tenaga needs to increase the tariff again otherwise it won't be registering good financial result.

Malaysia did survive through the 1997 financial crisis but we all pay the hefty price, our saving is depreciated more than 30-50% indirectly. But the recovering is surely lagging behind compared to others.

You are right about subsidising, most GLC have that. I wonder when will be the next tariff hike? Tenaga is monopolying the electricity supply in our country, so what I mean in my previous post is we still are the main consumers of Tenaga even how bad the market it. They might not be earning money but they are monoploying the market.

It is true that our country economy fundamental is not strong, we are lagging behind many SEA countries. Look at Singapore now, and we can know. Someone said we cannot compare two country from two different category, what I think is 'open your eyes'.

Rising oil price will hurt global economy.

Shih,
I am not saying Tenaga is good or not (to be classified as good blue chip or not) which is not my main point.

The highlighted quoted statement, is the main problem of many GLCs, can't or difficult (since totally said can't is a bit harsh, at least to be fair to them) survive on their own without gov.
I am not saying it should raise tariff nor Tenaga won't have good earning or not. Just to point out the problem of of some GLCs.

This post has been edited by cherroy: Jul 17 2007, 02:45 PM

I know that. No offence at all. Many GLC cannot really perform without the assistance of government. I just want to mentioned something, it is the market shares, I mean Tenaga is taking the almost the whole cake. I think there should be a competition between the electricity suppliers, as consumers, we might be benefited. Just like our country TELCOs, the tariff is going down instead of rising. (not sure whether I used the correct example)

YTLPOWER, GENTING seems like have certain expertise in this field also.

Shih,

You are wrong. Tenaga is forced to buy electricity from Independent Power Provider (IPP) at high price. Plus, Tenaga has to purchase the power even it does not need it. So, Tenaga is at a very bad spot.

I do not invest on any GLC period. After the 97 UEM affair, I refuse to be trapped into that kind of situation again. If you want to invest in GLC, you need to learn about the 97 UEM affair and decide whether it is worth the risk.

Dreamer

Hi Dreamer101,

I am afraid that you might miss my thread so I took others advice to contact you directly on your personal thread.

I am making ~RM6k a month and have some savings, I want to do some investing but I do not know where to start so I hope I am able to get some guidance in here.

My options are pretty are but not limited to:
1. Stock - I am learning this and my friend's mom is reliable and active in the market so I just follow her buy. (No, she is not those pasar lady who dont know stuff, she knows her stuff and was a business lady, resigned to be full time in stock market)
2. Unit Trust - Public Mutual have China Fund, Far East Fund and etc. I would like to know more about the risk and ROI
3. Fixed Deposit - Last option and preferably not touch this
4. I see all this: (May I know which is for non-bumi? and applicable to all races?)
1. Amanah Saham Nasional (ASN)
2. Amanah Saham Bumiputera (ASB)
3. Amanah Saham Wawasan 2020 (ASW 2020)
4. Amanah Saham Nasional 2 (ASN 2)
5. Amanah Saham Malaysia (ASM)
6. Amanah Saham Didik (ASD)
7. Amanah Saham Nasional 3 Imbang (ASN 3)
8. Amanah Saham Gemilang

What's the difference in Unit Trust, Mutual Fund and Bond? Can someone give me a clarification, please? I tried to Wiki these terms but its not very clear to me especially all the examples I read is based on other countries. Can someone give me a local example?

Will you be able to drop me some good advice? Thank you.

---

Added on July 17, 2007, 11:46 pmAnother family / personal matter, it may be wrong or not feasible but I would like to hear advice of others on my scenario.

I currently have 4 houses.
- 20 years single storey terrace, X
- 20 years double storey terrace, Y1 and Y2
- brand new bungalow, Z

Currently, my family (including parents and myself) are living in a double-storey terrace (Y1). We just bought the bungalow(Z) last year and took a 15 years loan for it paying RM4000 a month. I am not poor, nor rich but just average. My family runs our own business shared with other relatives, so our income is quite stable.

Now, my dad plans to sell away the single storey terrace (X) for RM120k. This money will be used to pay for our bungalow(Z) which is ~15km away from where we currently live. He decided to sell the house(X) because we are never moving back and having that single storey was giving us quite a lot of trouble. For a rental of RM500, we need maintenance and its not very easy to get tenant in my area. That's why we decided to let it go.

We will move into our bungalow(Z) in 3 - 6 months from now. Then, my current double storey house(Y1) will be empty. My other double storey house(Y2) is rented to a relative, so its fine and stable income every month.

My idea is to sell away my current double storey house(Y1), it's worth around RM300k, and take the money to buy another new double storey house nearer to my parents new bungalow. The purpose of my thoughts is that, I am getting married soon and I want to live in a new house with my wife, separated away from my parents but still near enough to take care of them, equally near my in-law as well just to be fair.

I spoke to my mom about it but she just jumped around making noise. I have not talk to my dad. Based on my mom's reaction, I can say she thinks I am thinking 'wrongly'. I think mainly is because RM300k will not be able to buy me a new house which has the same measurement as my current home (Y1) or maybe even smaller!

What is your advice?

ADDED:
X and Y1 is in Taman Chi Liung and Y2 is at Taman Selatan. These two neighbourhood are just next to each other. Z is at Setia Alam.

I am thinking of selling Y1 to buy another at Setia Alam.


This post has been edited by Casanova: Jul 17 2007, 11:46 PM

Casanova,

1) That is gambling / speculation. It is OKAY to put some (10% to 20% ) of your money in that. But, it is NOT investing. To invest you need to buy stock that you can go sleep for 5 years and still fine. There are ONLY less than 5 stocks in KLSE that allow you to do that. So find out those 5 stocks. Make sure that they are good and invest on those 5 stocks when the price is rght. I only buy one.

2) It is a GOOD idea to diversify away from Malaysia by buying unit trust that invest oversea. But, you need to spend fair amount of time to do research and find out what works. I have A/C in USA so that I can buy mutual fund that invest all over the world. That is a better than any UT in Malaysia. But, you have foreign currency risk that you need to manage accordingly.

3) FD -> you need some money in there for your emergency fund.

4) If you are a BUMI, I would advice you to buy ASB. If you are a non-bumi, I would advice you to avoid all ASX

A) I do not trust the government. Remember UEM - Renong Reverse takeover
B) I hate NEP and I refuse to support any GLC


Houses and etc..

1) Have you talk with your future wife?? Did you ask her what she think??

2) You definitely will have a smaller house in Setia Alam.

3) It might be better for you and your wife to be far away from everyone in the beginning of your marriage. Decide later whether to move to Setia Alam. Setia Alam will be building house for the next 20 years. You can wait.

4) It is a lot of money to get married, buy house, furnish house and so on.. Can you afford it?

Dreamer

First of all, thank you for your reply even though it is already so late. I really appreciate your effort and advices. Thanks again.

I know stock is very risky, the higher the risk, the higher your ROI. I know its a dangerous game so I only play very small. Enough to make RM500 is ok for me, enough to feed the family for 4 Sundays dinner at a restaurant. Whatever helps. Maybe this is a wrong mentality but right now, this is how I see it. I hope someday, my view will expand beyond what I am doing now and make even more.

Unit trust - I dont know about it very much. I need more details. I know my dad buys Public Mutual but I try not to talk to him about it. However, I will give it a shot this weekend to see what I can learn from my old man. Traditional Chinese family, parents do not like children to ask about their money, investment are seen as a form of gambling and asking is like prying into their privacy. Typical.

Avoid all ASX - Amanah Saham X? Anyway, I dont quite understand what Renong and all. I was not and still consider is not active in the investment world so there are many things that I do not know yet. I am reading, catching up whenever I can with The Edge Financial Daily. My parents subscribe for that.

I spoke to my wife very briefly about it. Since Y1 and etc is all my family house, I did not think I had to ask her. Anyway, she did say she can live even in a single storey as long as there is space for the kids and pets to run. I think she meant corner lot. Her dad gave her one already but I dont want to depend on my in-law nor parents. I prefer to own it on my own. Her dream is a semi-D which I probably cannot afford right now so we are planning to live in with my parents for the first few years before we move on.

I come to realize that Setia Alam homes are quite expensive compared to Aman Perdana. I believe some reality agent told me that the Petaling group has bought over the piece of land in front of Aman Perdana. That piece of land was initially going to be Klang Sentral but now the Petaling group will be building a new housing estate there. I am waiting to see how the pricing goes in the coming 2 - 3 years.

I agree we will have a smaller house at Setia Alam. But thats where everyone is and thats where my wife and I wants to be around. Its near to her parents and its also near to mine. Being the only son, I cannot just move out and stay far apart.

Thank you for reminding me that Setia Alam is building houses for the next 20 years. Hopefully they come up with something affordable for me around that time.

We have getting married covered. Buying house is just a thought. I thought it would be great to sell my current house for around 300k and buy a semi-D near our parents place. Do you think its not a good idea? Furnishing is a problem but that can be done slowly, we dont mind and we have already talked and agreed to it.

Anyway, thank you for going through my long post. Goodnight!

<<I know stock is very risky, the higher the risk, the higher your ROI. I know its a dangerous game so I only play very small. >>

So, you are NOT investing. I am talking about finding good solid stock that you can invest in.

<< Her dad gave her one already but I dont want to depend on my in-law nor parents. I prefer to own it on my own. Her dream is a semi-D which I probably cannot afford right now so we are planning to live in with my parents for the first few years before we move on.

We have getting married covered. Buying house is just a thought. I thought it would be great to sell my current house for around 300k and buy a semi-D near our parents place.>>

I think you should live with your parent for a while.

IMHO, you and your wife have a problem. Both of your families are too rich. You both might be use to living (semi-d) beyond what both of you can support with your income (6k per month). Can you support your life style if you live away from your parent??

1) You need to spend more time and read more edge before investing on anything.

2) It seem like you will be putting most of your money into the house that you will be living in. Is it wise?

3) You DO NOT have 4 houses. It is shared between you and your parent. Are you the only child?

Dreamer

if he wants to speculate or rather my favorite term "invest trading", so let him be. as long as he makes money. that's his goal, everyone's goal. in a way, it is good for him since capital gains are not taxed but dividends are. if you see his income, we'll know that he's already in a high tax bracket. anyway, he'll learn more about how local stock market runs as well.

i couldn't care less if the company is GLC-ed or any other crap, as long as it makes money for me legally i'm good.

I HATE NEP as well.

"the higher the risk, the higher your ROI" not always the case buddy.

---

Added on July 18, 2007, 5:18 amone has to go to us for the firm and open an account? if yes, how many malaysians can do that? and if we did, we are still troubled by <RM10K per trans = about USD3K. how many shares can we buy?

ontop of XXX risks, still have to "pay US taxes as non-resident (1040-NR)" as in 27% for non malaysian resident tax?

can the us stocks or funds talk be stopped? they are not helping at all, i hope this segment of the forum can provide (and debate) constructive ways to make money with the method or investment vehicles that are available to the malaysian general public.

This post has been edited by 1stLaksamana: Jul 18 2007, 05:18 AM

1stLaksamana,

<<if he wants to speculate or rather my favorite term "invest trading", so let him be. as long as he makes money. that's his goal, everyone's goal. in a way, it is good for him since capital gains are not taxed but dividends are. if you see his income, we'll know that he's already in a high tax bracket. anyway, he'll learn more about how local stock market runs as well.>>

You do not advice a person to gamble unless the person has the discipline to limit themselves. I don't have that kind of discipline. And, that is why I lost that much money. And, if you think I am the only one. You are WRONG. Almost all people that I know had that problem and we all lost a lot of money in that US bull run.

<<one has to go to us for the firm and open an account? if yes, how many malaysians can do that? and if we did, we are still troubled by <RM10K per trans = about USD3K. how many shares can we buy?>>

No. You do not have to go to USA to open an account.

The RM10K per transaction has to do with transferring of the money out of Malaysia. Once the money is in USA A/C, you can do any sizes of transaction.

In USA, there is NO lot size. You can buy as little as one share.

<<ontop of XXX risks, still have to "pay US taxes as non-resident (1040-NR)" as in 27% for non malaysian resident tax?
>>

http://www.offshorepress.com/offshoretax/alientax.htm

You need to file the tax buy I do not think you need to pay any capital gain tax. Dividend is taxable.

<<can the us stocks or funds talk be stopped? they are not helping at all, i hope this segment of the forum can provide (and debate) constructive ways to make money with the method or investment vehicles that are available to the malaysian general public.>>

1) This is MY THREAD.

2) It is accessible to people that want to know. I am NOT INTERESTED in general public.

3) How long do you think Malaysia can keep the financial market close?? It is just a matter of time before those American funds is available in Malaysia.

<<i couldn't care less if the company is GLC-ed or any other crap, as long as it makes money for me legally i'm good.>>

That was what most investor think until the UEM reverse take over of Renong in 97/98. I guess some people just have to learn from their own mistake.

I learnt my lesson.

Dreamer


This post has been edited by dreamer101: Jul 18 2007, 06:23 AM

Dreamer,

1. It is true that there is no real Index fund available in M'sia, but if the fund can outperform the benchmark, isn't it considered the fund manager beat the index?

2. Is the real index fund that you mean same to ETF?

3. Do you trade foreign ETF? due to the charges are comparisonly low compared to mutual fund/UT?

4. There is one disadvantages that I read about ETF which is lack of liquidity. Can you explain more on that? Is there any other risk that we should know?

Thank you.

shih,

1) Bingo. Have you ever see someone really benchmark those UT versus KLSE or some kind of index?? I bet you that in Malaysia as compare to most part of the world, those UT will lose to the Index.

2) No. I mean a passive fund where they only buy stock in the index as proportional to the index.

3) I do not trade. I invest. I only sell to re-balance my portfolio.

4) No problem in USA. There is liquidity problem in almost all stocks in KLSE anyhow. Do you know that?? Since 50% or more of KLSE belongs to GLC and GLIC and the government do not sell their stocks regularly, there are no many stock/share being traded everyday.

http://www.investopedia.com/terms/i/indexfund.asp

Dreamer

This post has been edited by dreamer101: Jul 18 2007, 10:57 AM

SO WRONG, they always do the benchmarking. Refer to public mutual website performance chart you will see the benchmark. Same goes with OSK and other company funds. If you find that's still not enough, morningstar has it all. And Msia has been one of the outperformer in our region and did better than the global average in the 1st half of 2007.

---

Added on July 18, 2007, 11:46 amCheck this out ! See what does SG think about our market.

http://www.fundsupermart.com/main/research...?articleNo=2243

This post has been edited by ejleemy: Jul 18 2007, 11:46 AM

ejleemy,

You still do not get IT. In order for somebody to show that he/she is a good fund manager, the fund has to do BETTER than the MARKET aka the INDEX. Or else, we should not need the fund manager. We could have just do the passive index approach.

Could you tell me that XYZ fund perform better than KLSE by how many percent in H1 of 2007?? This is how it is done in USA. Malaysia's has not reach that level of maturity yet.

Dreamer

P.S.: The first ETF that launch in Malaysia suppose to be a REAL INDEX base ETF. So, from now on, we can compare all UT with that ETF. If the fund manager cannot beat that ETF, we know that they are not better than market. This is similar to what happen in USA when Vanguard launch the S&P 500 index fund in 1976.

---

Added on July 18, 2007, 10:06 pm<<The FBM30etf will be the first ETF, introduced by AmInvestment Bank Group, to be listed on the Bursa Malaysia next Monday.>>

All,

I am looking for information on this ETF. This ETF is using the same index as EWM -> an ETF in USA.

So, we can use EWM's historical data to compare.

http://finance.yahoo.com/q?s=EWM

<<YTD Return (Mkt)²: 29.67%>>

Ignoring the negative effect of the USD currency (aka USD went down against RM), the local UT has to return much better than 30% for early part of this year in order to beat the market.

What I am saying here is if FBM30etf is a real index fund based on the same index as EWM, you will get much better than 30% for year to date.

So, why are you paying 5% to 7% commission to get in plus 1% to 1.5% annual maintenance when you can buy this ETF at 0.65% annual maintenance and minimal brokerage commission?

I would not buy it because my bias against GLC plus I am NOT optimistic about Malaysia stock market. But, if you want to invest in KLSE, this ETF seem to be the best option if the information that I collected so far is correct.

Dreamer


This post has been edited by dreamer101: Jul 18 2007, 10:06 PM

LOL seriously I think you are the one who doesn't get it or you are just too ignorant to learn how does a local mutual fund works and what really is a benchmark. They benchmark against the KLSE which is better than an index fund as index fund pricing is almost always lower than KLSE because of its charges.

http://www.publicmutual.com.my/application...erformance.aspx

Play around with it, for ex: select PSF and this year date => you see how it is benchmarked against KLSE.

If you are too ignorant to visit a local UT website, you can find them on morningstar.com too.

Msia YTD return only around 23-24%. The reason for an american investor who would make 29.67% YTD in that Msian Index fund is because RM appreciated against USD. As you can see how powerful is the forex. Any fund that gained over 24% YTD is an outperformer measured in RM. Not 30% ok ? Please learn to calculate forex properly.

FBM30 is a good deal for those who don't speculate much and go for a long long term. For those who like to go in and out market all the time where it will seriously add up their transaction fee, they should consider a mutual fund.

Mutual funds initial service charge is hefty at first to a lot of people, but as long as they keep invested, switching is at minimal cost or even free, they could take advantage of bull run in every region of the world for life ! And the best part is they have the option to BEAT the market whereas an index fund will never do that.

The bottomline is if you plan to go for a mutual fund, go for a good one, go for one that can beat the market, and always take full advantage of what the UT company offers... else just invest passively for the index fund.

Thank you.