The Edge-Lipper Malaysia Fund Awards 2008

Ok!.award presentation again!..These days there are so many awards given out, and some even give out broom ^o^ So is this one of those awards?..Certainly not!

The Edge-Lipper Malaysia Fund Awards are given to the best performing unit trust funds in Malaysia over the 3,5 and 10-year periods where winners are determined based on the Lipper Leader ratings for Consistent Return, a risk adjusted investment performance return measure developed by Lipper.

Only funds that have done well over a period of three years and beyond are recognised, in line with the practice adopted by the global Lipper Fund Awards. Some 17 awards covering seven fund categories were given out this year, including Islamic funds that topped their respective Lipper classification.

In this latest edition of The Edge-Lipper Malaysia Fund Award, Public Mutual Bhd, for the 5th consecutive years emerged as the biggest winner of this award, by winnng 8 out of 20 awards.

1) Public Mutual Berhad: Best Equity Group Award, 3 Years

PB Fixed Income Fund
2) Bond Malaysian Ringgit, 5 years

PB Growth Fund
3) Best Equity Malaysia Fund, 5 years

Public SmallCap Fund
4) Best Equity Malaysia Small and Mid Caps Fund, 5 years

PB Balanced Fund
5) Best Mixed Asset Malaysian Ringgit Balanced Fund, 5 years

Public Ittikal Fund
6) Best Equity Malaysia Fund, 5 years
7) Best Equity Malaysia Fund, 10 years

Public Bond Fund
8)Best Bond Malaysian Ringgit Fund, 10 years


So How Lipper determine the winner?
For your information, Lipper is the leading global provider of fund intelligence. They provide accurate, comprehensive and objective information on funds and fund markets.

The methodology they used to determine the winner of the award can be view in the link below

http://www.lipperweb.com/services/award_methodology.asp

How To Select The Right Unit Trust Fund?

In today’s unit trust industry, there are a variety of different unit trust funds for you to choose from. But the 1st step perhaps is to identify your risk profile, or your appetite for risk

There are generally 3 types of risk profile for the unit trust fund, namely Aggressive, Moderate and Conservative. Do take note of the risk profile of the fund that you are going to buy, as this represents your investment objective.

If you want your money to grow a larger sum in the future and your risk tolerance is higher, you may choose a fund with a risk profile: Aggressive.

On the other hand, if what you are looking to achieve is an ongoing income stream to pay for expenses and your risk tolerance is low, you may choose the Moderate or Conservative risk profile.

Every individual may have different investment objectives, risk tolerance and time horizons at any one time, therefore the variety of different funds. So the fund you invested in must be one that suit your objective.

A logical next step will be to look at the past performance or investment results. Unfortunately, it is impossible to predict a unit trust’s future investment performance. This will depend on the type of fund, the general market trends and the investments which a fund manager picks. Past performance figures are no guarantee of the future. A fund that has performed well in the past may not do so in the future and vice versa.

The summary of Do’s and Don’ts of Choosing a Unit Trust Fund

Do

- Decide which type of unit trust fund meets your saving needs.

- Shop around for a reliable unit trust company

- Check past performance records

Don’t

- Don’t choose any unit trust fund just because its performance has been good, make sure it is the right fund for you.

- Don’t pay too much attention to short term performance, good consistent performance over all periods is the best lead.

- Don’t decide on a unit trust fund just because it has low charges, good performance is far more important

- Don’t borrow to invest in unit trust

How to calculate the units you owned?

The ownership of fund will be divided into units.

For example:
If you invest RM1000 into a fund with the unit price RM0.25, you are suppose to get 1000/0.25= 4000 units.

But because these unit trust managers manage these funds for you, they will charge a certain amount on you, which will be known as Service Charge. Worth noting is that this Service Charge is one-time charges, unlike invest directly in the share market where there will be a minimun brokerage of RM40++ whenever you sell or buy.

The current rate of Service Charge will be around 5% for equity & balanced funds. So assume that the Service Charge is 5%, the actual units you actually get will be:

(4000/105) x 100= 3809.52 units

The formula will be

(Amount invested/unit price)/(100+ service charge,%) x 100

Also, when there are distribution (or in generally dividend) by the fund, it will also distribute in units. With the current format of single pricing, if you want to know how much is your unit trust worth now, just check the the price of the particular fund from the newspaper or internet, and times it with the number of units you owned.

unit price x number of units = the current value of your fund

Unit Trust:concept & the right frame of mind

Unit Trust is an investment vehicle that pools the financial resources of many individual investors who aim to achieve similar investment objectives.

So how does it work? Ever wonder what the EPF do with all the money from the contributors?And where do they get the money to pay the dividend to the contributors?
Yes, they invest it.

The basic concept of Unit Trust is some what similar, that is they pool the money from individuals and invest it, but of course there are differences between them.

Among them:

Flexibility
Like it or not, you will have to contribute to the EPF if you are working class these days, eventhough you are not satisfied with the dividend they pay out, whereas in Unit Trust, you can choose to buy or not to buy, which fund you want to buy.

Liquidity
You can't take out your money from the EPF unless you reach certain age, or under certain condition (which I will elaborate more later), whereas for Unit Trust you can sell your units and get back ur money anytime you want.

Making losses while investing in unit trust is possible, right?but EPF never pay less than stated in the statement..

The inliquidity of EPF actually help to make the EPF safer than Unit Trust. How?..Because they know how much money will be taken out and when. Therefore, even if they are losing from their investment, they will still be able to pay out the amount required as they can make provision beforehand. So you wouldn't get less money from EPF than what is stated in your statement.

The same can't be said of unit trust. Simply because every fund holder can take out the money,anytime he/she wants, so their funds have to be calculated everyday, in case everyone wants to take out the money,they will still be able to pay out. Therefore if they are making losses in their investment, it will be shown in the unit price, making the fund holder to lose money if they sell at that time.

the right frame of mind

So if you are investing in unit trust for savings, then you shouldn't feel uncomfortable if the unit price is lower than your buying price, simply because you are investing for long term, and you are not selling it at the moment. Instead the drop in price will make you more determined to keep the savings go on, because you don't want to make a loss by sellling now, whereas if the unit price keep going up, you will be tempted to break your savings and sell for profit.

If you are think investing in unit trust are just like investing in shares, then sorry to say it don't work the same way. Speculation don't work in unit trust, and earning quick money should not be the purpose for investing.