Professional Investment Management

A unit trust combines the capital of many investors to employ experienced management in purchasing securities of many companies. The management of a unit trust provides diversification of investments and supervision which few investors could individually afford. Investment management is a full time job requiring specialized knowledge and training. It involves the study of a variety of factors.

Some of the factors which have to be examined are,
1. Comparisons of all industries in the economy
2. Relative studies of companies within a promising industry
3. Personal contact with management of promising corporations
4. Evaluating the effect of international events, both monetary and political
5. Determining the results of government policies on each industry

Professional management is also interested in studying less obvious factors such as wage rates, which might affect the economy or the profitability of certain companies or corporations. It requires careful study of individual companies within the industry to determine which of the many companies offer the best prospects for the investors. It requires comparing this company with the best companies in other promising industries. Since all this factors are constantly changing, re-evaluation and study have to be continuous.

Selecting The Right Unit Trust - How Do I Find A Unit Trust That Fits My Objective?

It used to be simple selecting a unit trust. Today, there are a multitude of different unit trust funds available in the market that making that choice is no longer easy. Perhaps a simpler way is to first identify your investment objectives. If you want your money to grow a larger sum in the future to pay for an objective and your risk tolerance is higher, you may choose a growth fund to do the job. On the other hand, if you need an ongoing income stream to pay for expenses and your risk tolerance is low, a better choice would be a bond fund. You may have different investment objectives, risk tolerance and time horizons at any one time, which warrants owning a mixture of different unit trust funds for different investment purposes.

Review of Current Market

Hi All,

Here are some information on world market reviews:-

The DJIA closed +396.97 points after US government’s plan to bailout the Citigroup.The fluctuation of mkts have stabilized without the mad swings and crashes before this. US President has formed his economic team with NY Federal Reserve President Tim Geithner as Treasury Secretary to help US to recover in his 2 years stimulus package.

Europe markets closed within 5-10% positively.

Malaysian economy situation now compares to 1997/2001 is a lot better with 2.5% NPL and 75% loan ratio. Band Negara has lowered the overnight lending rate to 3.25% after 5 years. Well-timed as the economy slows down and in line with others. This will lower the cost of fund to the bank and cost of borrowing to the consumers. Certain sectors that export to US are affected like Seagate but Banks 3rd quarter reports still profitable.

In recent FMUTM annual Convention, it was pointed that Asia is not decoupled from US but actually we are more integrated than before. However, from 2004 to 2008 when US decelerated, Asia accelerated. With 3% US growth (optimistic) and Asia’s 7% growth (conservative), for every USD1 US is spending, Asia is spending 93cents. In 2010, Asia will catch up USD1 to USD1 (not in 15-20 years’ time as thought earlier). Conclusion is:- Same Train but Asia will be the Locomotive to drive the world growth in future.

What do you all think forward?


1. Invest in Unit Trust investment fund
2. For existing investors, you may choose either (1) investing a portion into existing funds and balance on monthly instruction (RII/DDI) or (2) one lump sum now.

For new investors, they are lucky to invest their funds in current market valuations which are below historical averages. Investment put in now will have higher growth than earlier investment. When markets recover, the existing investment will go back to around 8% pa CAGR and new ones may see 12-13% pa growth, say in 3-5 years time.