Articles

Friday, December 27, 2013

EPF New Basic Savings Effective January 2014

EPF New Basic Savings Effective January 2014
To Ensure Members’ Retirement Well-being
 
The Employees Provident Fund (EPF) today wishes to remind members that the revised Basic Savings will take effect on January 2014. The new quantum will set RM196,800 as the minimum amount members should have in their EPF account when they reach the age of 55.

Tuesday December 10th, 2013 

Published: Saturday November 23, 2013 MYT 12:00:00 AM
Updated: Saturday November 23, 2013 MYT 12:45:20 PM

How EPF makes money for dividend payment

by jagdev singh sidhu
IT’S probably the one dividend rate most Malaysians will scrutinise. The rate will be dissected, debated and then the verdict from the people will be whether it’s satisfactory or poor.

That single dividend is what the Employees Provident Fund (EPF) announces yearly. Last year’s 6.15% was the highest in a decade but the challenge that the EPF faces is how to keep that going.

For further reading, click here........

 

Wednesday, November 27, 2013


Press Statement from Bank Negara on 18 Oct 2013...........



Bank Negara Malaysia (BNM) announces today the introduction of a new interest rate framework. The new interest rate framework represents a change in the system of implementing monetary policy and promotes more efficient pricing by banking institutions. It does not represent a change in monetary policy. Therefore, the introduction of the new framework is not expected to lead to any change in the general level of domestic interest rates.

For more, click here to read......

 

Friday, November 15, 2013


Seven Quotes from Warren Buffett on Gold

Seven Quotes from Warren Buffett on Gold


May 28, 2013 | About: GLD +0%
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Warren Buffett is not a big proponent of owning gold to be sure. I'm not too keen on it either, but given what has happened to the share prices of junior gold miners I can't help but think the entire sector is dramatically oversold.

Check out the chart on the junior gold miner ETF below:

[ Enlarge Image ]

It is hard to imagine that at current gold prices there aren't some serious bargains to be had in this bunch, or perhaps the entire ETF is a good idea.

As I consider some investments in the junior gold mining sector I thought it would be wise to revisit the wisdom of Buffett and his thoughts on gold:

For 7 quotes, click here to read...........

 

 

Saturday, November 9, 2013


Data & Statistics from Securities Commission

For "Unit trust funds in Malaysia – Summary of Statistics as at 30 Sep 2013", click http://www.sc.com.my/data-statistics/unit-trust-funds-in-malaysia-summary-of-statistics/

 

For "Statistics for fund management industry as at 30 Jun 2013", click http://www.sc.com.my/data-statistics/statistics-for-fund-management-industry/


Wednesday, 23rd Oct 2013

Unit trust's CG challenge

Source : theStarOnline Business News

Published: Saturday October 12, 2013 MYT 12:00:00 AM
Updated: Saturday October 12, 2013 MYT 7:51:22 AM


by errol oh
THE Malaysian unit trust industry quietly recorded a milestone at the start of the year when the total net asset value (NAV) of its funds climbed above the RM300bil mark in January. That figure matters because it shows just how fast the industry has been growing in recent years.

When 1996 came to a close, the total NAV was RM60bil. It went past RM100bil in January 2006, about nine years later. However, it took only four years to double. That was in March 2010.

To continue reading, please click  here......



Sunday, October 13, 2013

EPF International Seminar 2013: Financial Literacy & Retirement Savings “Towards Securing A Comfortable Retirement”


Recognizing the importance of retirement/financial planning and its relationship with retirement savings, Employees Provident Fund (EPF) has organised an international seminar entitled “Towards Securing A Comfortable Retirement” on the 17 & 18 September 2013. The seminar was aimed to expose policy makers and employers with good practice on financial education at workplace besides encouraging the latter to set up financial education programme in their organisation.The two-day seminar was divided into six sessions and conducted through keynote addresses and panel discussions. 


Please kindly click on the link below for presentation slides of speaker at the seminar.

How Financial Education In The Workplace Could Help Employess To Secure Better Retirement Income 

 

Tuesday, October 1, 2013


Did you know!


According to the UN Department of Social and Economic Affairs, the world population is ageing rapidly, with the population aged above 60 years old expected to grow from 10% last century to 21% in the first half of the 21st century. Some of the factors causing this are advances in medication and the ageing of baby boomers. That said, retirement is clearly a hot topic!
Source....http://learn.dailyfinance.com/courses/is/intro-to-retirement/should-i-be-planning-for-my-retirement/

Tue 6th Aug 2013

Meet Your New Boss: Buying Large Employers Will Enable China To Dominate 1000s Of U.S. Communities

June 8, 2013

Source: Michael Snyder, Guest Post
Are you ready for a future where China will employ millions of American workers and dominate thousands of small communities all over the United States?  Such a future would be unimaginable to many Americans, but the truth is that it is already starting to happen.  Chinese acquisition of U.S. businesses set a new all-time record last year, and it is on pace to absolutely shatter that record this year.  Meanwhile, China is voraciously gobbling up real estate and is establishing economic beachheads all over America.  If China continues to build economic power inside the United States, it will eventually become the dominant economic force in thousands of small communities all over the nation.  Just think about what the Smithfield Foods acquisition alone will mean.  Smithfield Foods is the largest pork producer and processor in the world. For more, click here.....



Fri 31st May 2013


Is EPF speculating?
QUESTION TIME One thing stands out from the announcement of the first quarter results of the Employees Provident Fund (EPF); the retirement repository of over 12 million Malaysian workers which now manages some RM540 billion of funds and is one of the largest single retirement funds in the world.This is a sharp drop in its investment income to RM5.6 billion for the first three months of the year, down 28 percent from the RM7.74 billion recorded for the corresponding quarter last year.What is positively alarming is the statement that explains the drop: “Income in 1Q12 was boosted by one-off gains that were not replicated in 1Q13. A lack of volume on the local Bursa Malaysia in the first quarter also contributed to the decline in earnings this quarter.”That’s puzzling on two counts. First, what kind of one-off gains did it benefit from last year? Did it sell shares that it had acquired cheaply to register income? If it did so, then what was the reason? Could it be to pay a good dividend for last year to members this year?Second, why does EPF depend on stock market volume to make its money on the stock market? As a long-term investor which safeguards the savings of its members for retirement, is it not incumbent upon it to get the best returns over a period of time instead of short-term profits that cannot be repeated?The overall paramount question arising from these is whether the EPF is speculating with members’ money instead of investing it in assets which provide a steady stream of earnings and capital appreciation over an extended period of time.EPF’s behaviour in terms of investing in the stock market is worrisome and has deep implications on the returns it provides on members’ money. The evidence is clear that EPF is engaged in trading to get income up, a dangerous way to go as this is a high-risk strategy totally out of whack with its stated objectives.And because EPF, the largest single investor in the local stock market, has such a colossal amount of money, it is rather easy to hide the individual losses that it makes.A look at its income figures is instructive. It made RM1.52 billion from Malaysian government securities and equivalents in the first three months of the year, the same as in the previous corresponding period. Income from loans and bonds amounted to RM1.92 billion, down RM485 million or about a fifth, probably reflecting declining interest rates.The big fall was in equities where income declined RM1.71 billion or nearly 50 percent to RM1.86 billion while contributions from money market instruments declined to RM78 million (RM178 million previously) and real estate and infrastructure increased to RM227 million (RM74 million).The big reduction in equities income must reflect decreases in trading income, obtained from the buying and selling of shares, because dividend income from year-to year for the shares would not have been very different. That EPF is so dependent on trading income is unhealthy and risky.Feel-good factor for the electorate?The question is whether EPF deliberately tried to increase its trading income last year so as to be able to pay better dividends this year ahead of the general election as a feel-good factor for the electorate.The fund declared a dividend of 6.15 percent for 2012 in February, an increase over the 6 percent paid out for 2011. It represented a record breaking total of RM27.45 billion being distributed to its members, an increase of 12.2 percent the RM24.47bil paid out in the previous year, said EPF chairperson Samsudin Osman.“Notwithstanding the increasingly complex investment environment, the EPF maintained its steady upwards momentum to post its strongest set of results since the turn of the millennium, underpinning the effectiveness of its long-term investment strategy as well as its disciplined and prudent approach,” he said in a press statement.Unfortunately, that may have been less than prudent. By taking profits on good investments, it is by no means certain that EPF can get back into these investments at the same attractive prices again. As a long-term investor, it should be invested in good companies which provide good returns.This is all the more important as equities have become the largest single asset class for investments held, accounting for RM203.75 billion or nearly 40 percent of the fund with loans and bonds accounting for RM151.48 billion and government securities RM145.56 billion.A check of trading on May 17 on the local bourse shows that EPF is the most active player on the market, buying and selling some 32 million shares. In some instances, on the same day, it bought and sold hundred of thousands of the same share, incurring needless brokerage.In contrast, the other major investor on the stock market, Permodalan Nasional Bhd (PNB) and its unit trusts, sold just 2.32 million shares - EPF trades amounted to some 14 times that.PNB has some RM240 billion under management at last count with an estimated 80 percent or so invested in the equities markets, which amounts to about RM192 billion, only about 5 percent less than EPF’s RM205 billion. Yet EPF’s transactions are 14 times that of PNB! Why?Surely trading stocks cannot be one of the mainstay incomes of a retirement fund.
P GUNASEGARAM is founding editor of KiniBiz. He is appalled at the continuing lack of transparency, governance and accountability of the EPF.


Monday 20th May 2013
From OV President:-

              So decide which you would want to adopt from now on.................

 

 

Saturday, May 11, 2013

Stock Investing For Dummies

From Stock Investing For Dummies, 4th Edition by Paul Mladjenovic
You're investing in stocks — good for you! To make the most of your money and your choices, educate yourself on how to make stock investments confidently and intelligently, familiarize yourself with the Internet resources available to help you evaluate stocks, and find ways to protect the money you earn. Also, be sure to do your homework before you invest in any company's stock. Click here for more....

 

Monday, April 22, 2013

 Eight Principles Of Successful Investing In Unit Trust

Many people spend years searching for the best way to invest their savings. It was then discovered that managed investment, as in unit trusts, is one of the keys to investment success. Unit trusts are a convenient and sensible way for investors to enter the investment field. Unit trusts can offer you stronger long-term performance, lower risk through diversification and the benefit of investment specialists looking after your money.

In order to make a wise investment decision, you should consider the following eight principles to successful investing in unit trusts:



PRINCIPLE 1 : LEARN THE BASICS - UNIT TRUSTS IN GENERAL

What Is A Unit Trust And How Does It Work? A unit trust is a professionally managed investment fund which pools your money with that of many other investors with similar investment objectives. The aggregate sum is then used by the fund to build a diversified investment portfolio which comprises stocks, bonds and other assets in accordance with the investment objective of the fund. The price of a unit reflects its total Net Asset Value, commonly referred to as NAV (the fund’s assets less its liabilities, divided by the number of units in issue). Unlike stocks, whose prices are subject to change at each trade, the fund’s NAV is calculated only at the close of each day’s trading. Hence the fund’s unit price is quoted in major newspapers on the following Business Day.

To protect your rights and interests as investors, an independent Trustee is appointed to ensure compliance of the Manager with the requirements of the Trust Deed, Securities Commission Guidelines on Unit Trust Funds and Securities Commission (Unit Trust Scheme) Regulations 1996. The manager is also required to appoint an approved Company Auditor (within the meaning of the Companies Act 1965) for the purpose of conducting annual audits of the Fund’s accounts which must be included in the fund’s annual report.

What Are The General Benefits Of Investing In A Unit Trust?

Diversification – the spreading of risks over a wide variety of securities in different sectors. Normally to do this, you must have a substantial amount of money to buy a diversity of stocks. However, unit trust funds facilitate this by providing small savers with an opportunity to pool their savings to invest in a diversified portfolio of stocks or you could think of it as "not putting all your eggs in one basket".
Professional Fund Management – your ability to "employ" a team of well-trained, in-house investment professionals who conduct full-time regular investment research and analysis in managing the assets of the Fund. With such investment expertise, research facilities and information network, sound investment decisions may be made.
Liquidity – you can redeem all or part of your units on any Business Day and the Manager will purchase them.
Hassle Free – you need not trouble yourself with complicated decision making and arduous paperwork involved in investment in the securities market.
Affordability – you only need a small amount of money to participate in a professionally managed portfolio of investment and enjoy the same benefits accorded to others when investing in high priced securities. At the same time, you can also reap better returns from a portfolio of investment as opposed to the limited number of securities which one can invest individually.

What Are The General Risks Of Investing In A Unit Trust?
Market risk -
the portion of risk arising from changes in the economic, political and social environment and affecting the stock market market as a whole.  Even a well-diversified fund cannot avoid market factors when they are such as to simultaneously affect the prices of all securities irrespective of their sectors and prospects.  In cases where market factors affect only a few sectors, investment in a unit trust offers a measure of protection.
Specific risk or stock risk -
the portion of risk which is unique to the company that issued securities.  Specific risk can be associated with management errors, shift in consumer taste, advertising campaign, lawsuits and competitive industry conditions.  It can be minimised by diversifying the fund's investment over more companies in various segments of the economy which operate independently from one another.
Loan financing risk -
the portion of risk which you must consider carefully when taking a loan to invest in unit trusts as borrowing increase the opportunity for loss as well as profit.  If the value of your investment falls below a certain level, the bank may require you to reduce your loan balance.  Also your borrowing has an interest cost, which may go up and eat into any gains that your fund makes.
Management company risk -
the portion of risk that the Manager may not adhere to the investment mandate of the fund.  However this risk is greatly reduced by the presence of the Trustee whose duty is to ensure that the fund's investment mandate is complied with.
Interest rate risk -
Interest rate anticipation is the most critical factor in any active bond portfolio management strategy because it involves relying on forecasts of uncertain future interest rates.  In the event of rising interest rates, prices of debt securities will decrease and vice versa.   Meanwhile, debt securities with longer maturity and lower coupon rate are more sensitive to interest rate changes.
Liquidity risk -
the portion of risk which is faced by a fund which trades in thinly traded or illiquid securities.  Should the fund need to sell a relatively large amount of such securities, their selling price would be greatly lowered due to the selling pressure.
Credit/Default risk -
the risk that the issue of a fixed income instrument will experience financial difficulties causing a deterioration in creditworthiness, perhaps even a default in the payment of principal and interest.
Inflation/Purchasing power risk -
the risk that the real rate of return from the investment (i.e. the return less inflation rate) is eroded by the loss of purchasing power due to inflation.
Distribution risk -
it is not the policy of the Manager to guarantee the investment returns or dividend payout to unitholders.  In addition, the past performance of a fund is not indicative of its future performance.

Comparison of Unit Trusts with Direct Investments in the Stock Market & Fixed Deposits

Unless a person has a very large amount of cash for direct investments in individual stocks, he may not be able to achieve a sufficient level of diversification.   Losses in one or more of his stocks may substantially reduce the value of his portfolio.  Unit trusts, on the other hand, have a diversified portfolio and losses in some of the stocks held are offset by gains in others.  Nevertheless, a person with an undiversified portfolio may reap great returns if one or more of his stocks increase in value.  Unit trust prices rise more gradually when some of its stocks' prices increase as the unit prices are based on the total value of the portfolio.

Fixed deposits are generally safe and the returns are guaranteed.   Nevertheless the returns are generally lower and may be eroded by inflation.   Unit trusts generally aim to achieve returns that are higher than fixed deposits but such investment carries the risk that losses may be incurred.



Who Regulates The Unit Trust Schemes In Malaysia?

The Securities Commission is the main regulatory body governing the establishment and operations of unit trusts in Malaysia under the Securities Commission (Unit Trust Scheme) Regulations 1996. This requires, inter alia, that the Manager and Trustee execute a Trust Deed, registered with the Securities Commission. You may purchase a copy of the Trust Deed which is registered with the Securities Commission for inspection at the Manager’s office.


PRINCIPLE 2 : KNOW YOURSELF
The conventional wisdom says you should be willing to accept more risks when you are younger and then gradually shift to safer investments as you approach retirement. But this is only a general rule. There is plenty of flexibility for you to satisfy your individual needs and preferences. To help you choose the most appropriate funds for your investment needs, answer the following series of questions:
"What stage of life cycle am I at now?"
"What are my investment goals?"
"What kind of returns am I looking for?"
"How much risk am I comfortable with?"

PRINCIPLE 3 : ESTABLISH YOUR INVESTMENT STRATEGY
Once you have a good understanding of your personal situation, you will be equipped to make informed investment decisions and ready to develop your investment strategy.
The most important element of your strategy is diversifying your portfolio bacause you need the right mix of investments to achieve your goals. There are however, two factors you should keep in mind:-
Inflation - you will have to protect your purchasing power against inflation.
Liquidity - this simply means the ability to quickly get your hands on your money.

PRINCIPLE 4 : START EARLY
The earlier you start saving through regular investing, the better off you are going to be. Reasons: The power of compounding or the accelerated rate at which your savings grow over time. The best way to take advantage of compounding is to contribute as soon as you can – as early in life as possible and regularly during the year through a regular investment plan.

PRINCIPLE 5 : SAVE REGULARLY
Your savings will grow faster if you contribute regularly. Reasons : The key benefit of investing in unit trusts through a regular investment plan is dollar-cost-averaging. Dollar-cost-averaging enables you to purchase units at different times and at different market prices, which means you often pay less for your investment than if you made one lump sum purchase. As a result, dollar-cost-averaging generally ensures a greater overall return from your investment.

PRINCIPLE 6 : INVEST FOR THE LONG TERM
Historically, unit trusts have provided greater long-term returns and have entailed greater short-term risks than other savings vehicles. Thus, you should balance the risks and rewards of your investment choices. Investments with higher returns potential, such as stocks, often involve greater risks whereas investment with lower risks, such as investment grade bonds, generally earn lesser returns. Unit trusts allow you to reap higher returns over the longer term than other savings vehicles although its market value as reflected in unit prices may fluctuate over the short term.

PRINCIPLE 7 : DIVERSIFY YOUR PORTFOLIO
Diversification through prudent asset allocation among the various funds and other investment assets can help you ride out the bumps in the road. Diversification works because the different investment assets classes have different fundamental characteristics and can move in different directions. For example, when the economy is faltering and interest rates are falling, bonds will usually outperform, whereas when the economy is booming, equities will generally outperform bonds. Diversification increases returns while lowering risks, which is why it is the single most important part of your overall investment strategy.

PRINCIPLE 8 : MAKE ADJUSTMENTS OVER TIME
Monitor your investments on a regular basis to ensure that they still reflect your long-term financial goals and personal circumstances. For example, at one stage in your life you may be seeking longer-term investment that focuses on building savings and accumulating capital. Later on, you may prefer a lower-risk investment that places more emphasis on a steady stream of income.
Whatever the reason, making adjustments over time is essential and needs to be incorporated into your investment strategy. Through regular monitoring you can ensure that your investment portfolio continues to match your long-term objectives.



Sunday, April 21, 2013

Malaysian Individual Tax Reliefs for Years 2010, 2011 & 2012 Malaysian Individual Tax Reliefs for Year 2009

Pelepasan Cukai Individu Pemastautin bagi Tahun 2010, 2011 & 2012
Pelepasan Cukai Individu Pemastautin bagi Tahun 2009

Just click this link below :-
http://www.hasil.gov.my/goindex.php?kump=5&skum=1&posi=3&unit=1&sequ=1

 

Sunday, April 7, 2013


Market Capitalization of Unit Trust NAV in Bursa Malaysia - "SUNRISE INDUSTRY"

Month-to-Month Graph and Data


Month
Total NAV
Bursa Malaysia Market Cap.
Percentage
Feb-12
267.017
1,345.30
19.85%
Mar-12
270.059
1,355.44
19.92%
Apr-12
270.880
1,332.75
20.32%
May-12
272.056
1,320.23
20.61%
Jun-12
277.828
1,367.88
20.31%
Jul-12 283.427 1,423.83 19.91%
Aug-12 288.967 1,431.58 20.19%
Sep-12 290.924 1,417.29 20.53%
Oct-12 296.221 1,463.04 20.25%
Nov-12 293.991 1,415.21 20.77%
Dec-12 294.851 1,465.68 20.12%
Jan-13 300.190 1,422.47 21.10%
Note
Total Net Asset Value (NAV) and Bursa Malaysia Market Capitalization are in RM Billion.
Sources:
Securities Commission
Bursa Malaysia 
Malaysian Capital Market Masterplan II.......Towards 2020..........Size of Malaysian Capital Market will be RM4.5Trillion Baseline with RM5.8Trillion Potential Upside. Targetted Market Cap of Unit Trust NAV is 40% (RM1.8Trillion Baseline) in 2020.

Saturday March 30, 2013

Unexpected retirement costs

By EUGENE MAHALINGAM
eugenicz@thestar.com.my


Foo: ‘It takes proper planning to prepare for your retirement years.’ Foo: ‘It takes proper planning to prepare for your retirement years.’
We may end up watching all of our life's savings go on something we did not quite plan.
PREPARING for retirement is something we ponder and talk about quite often but when that moment finally comes, a lot of times, we're just ill-prepared for it. Click here for more....

 

EPF members may be able to invest more in unit trusts

 

EPF members may be able to invest more in unit trusts
Employees Provident Fund (EPF) depositors who have more than RM120,000 of basic savings in the Account 1 may be able to withdraw more of their funds to place in approved investments.
NONEThis was revealed in the Economic Transformation Programme 2012 annual report launched by Prime Minister Najib Abdul Razak last night. For full story, click here...

 

 

 

 

Analysis: U.S. companies plan to spend, a boost for the economy

By Caroline Valetkevitch | Reuters – Fri, Feb 22, 2013
NEW YORK (Reuters) - U.S. companies' capital spending plans are holding up, and mostly exceeding Wall Street forecasts, in the face of policy concerns created by arguments in Washington over the fiscal cliff, the debt ceiling and now automatic spending cuts.
Their willingness to spend on new offices, plants and machinery, as well as a pickup in deal making, shows that they are starting to dig into the massive amounts of cash that has been collecting more dust than interest on their balance sheets. That could prove a welcome counterpunch to a softer outlook for spending by consumers and government......for full story, click here.


2013:The 'Break-Out' Year for China Stocks?

Chinese stocks have staged a remarkable comeback in the final weeks of the year, gaining more than 11 percent in December after languishing in negative territory for most of 2012, prompting analysts to say 2013 may finally be the year Chinese stocks break out of the doldrums.
The Shanghai Composite Index (Shanghai Stock Exchange: .SSEC-SZ) hit a five-month high earlier this week on Christmas day and was trading 0.4 percent higher on Friday as investors bet that the worst is over for Chinese stocks.
According to Jack Bouroudjian, CEO of fund manager Bull and Bear Partners, money is waiting to return to the Chinese stock market now that the dust has settled on the once-in-a-decade leadership transition in November. .........for full story, click here.

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