Where to go? There are lots of attraction that you should not miss in Langkawi. Local people usually symbolize Langkawi with the gigantic Eagle situated at the Jetty Point. A windy place and a perfect place for you to take pictures. I myself have taken some photos during my vacation there.
During my Langkawi vacation I also went to the Gunung Mat Cincang. A tourist spot that you should not miss. But why I said that? Of course you should not miss to walk in the cloud. At slightly over 700 meters, it is the second tallest peak in Pulau Langkawi after the 850-meter Gunung Raya. Telling you the truth I was quite nervous during the way up to the peak. The cable car only cost you RM15 for adult and RM10 for child. Perhaps the cheapest cable car fare in the world. I felt like I was on the top of the world when I reach the peak. I will never forget the view up there. You should not miss it. To go there you are advice to take cab from the hotel lobby and ask the hotel staff to arrange it for you.
Next Langkawi Underwater World, this is also one of the famous tourist spot. However I never been there but I recommend you to go there. Why? They have 5000 of marine life and displayed in 100 tanks with different size and I never heard any tourist complaint about the Langkawi Underwater World. Admission is only RM18 for adult and RM10 for child.
Continue your journey to the Galeria Perdana at Kilim. At first I thought it was just ordinary boring gallery. After my friend urge me to spent some time there, I walk in through the front door and I thought I will waste 2 hours of my Langkawi vacation in this boring gallery. But all my thought was wrong. The gallery was full with state gifts and awards presented to the Prime Minister of Malaysia, YAB Dato' Seri Dr. Mahathir Mohamad and his wife, YAB. Datin Seri Dr. Siti Wasmah bt. Mohd. Ali. I wish I was the prime minister because some of the gift worth thousands or even millions. I don't know how to describe the gift however I am very sure you will not waste your time there. Admission RM3 for adult and RM1 for child
Langkawi is famous with the Mahsuri legend. Let me tells you a short story about Mahsuri. She is a pretty girl that live 200 years ago, she was accused of committing adultery and was sentenced to death. She bled white blood at her execution as a sign of her innocence. Nowadays local people usually come to Makam Mahsuri (Mahsuri's Mausoleum) as a part of their vacation. A perfect place to get information on Langkawi history. Admission RM2 for adult and RM1 for child.
Have a nice trip to Langkawi Island. "Selamat Datang"
Sunday, October 25, 2009
Malaysia Tourist Guides For Langkawi Vacation
Where to go? There are lots of attraction that you should not miss in Langkawi. Local people usually symbolize Langkawi with the gigantic Eagle situated at the Jetty Point. A windy place and a perfect place for you to take pictures. I myself have taken some photos during my vacation there.
During my Langkawi vacation I also went to the Gunung Mat Cincang. A tourist spot that you should not miss. But why I said that? Of course you should not miss to walk in the cloud. At slightly over 700 meters, it is the second tallest peak in Pulau Langkawi after the 850-meter Gunung Raya. Telling you the truth I was quite nervous during the way up to the peak. The cable car only cost you RM15 for adult and RM10 for child. Perhaps the cheapest cable car fare in the world. I felt like I was on the top of the world when I reach the peak. I will never forget the view up there. You should not miss it. To go there you are advice to take cab from the hotel lobby and ask the hotel staff to arrange it for you.
Next Langkawi Underwater World, this is also one of the famous tourist spot. However I never been there but I recommend you to go there. Why? They have 5000 of marine life and displayed in 100 tanks with different size and I never heard any tourist complaint about the Langkawi Underwater World. Admission is only RM18 for adult and RM10 for child.
Continue your journey to the Galeria Perdana at Kilim. At first I thought it was just ordinary boring gallery. After my friend urge me to spent some time there, I walk in through the front door and I thought I will waste 2 hours of my Langkawi vacation in this boring gallery. But all my thought was wrong. The gallery was full with state gifts and awards presented to the Prime Minister of Malaysia, YAB Dato' Seri Dr. Mahathir Mohamad and his wife, YAB. Datin Seri Dr. Siti Wasmah bt. Mohd. Ali. I wish I was the prime minister because some of the gift worth thousands or even millions. I don't know how to describe the gift however I am very sure you will not waste your time there. Admission RM3 for adult and RM1 for child
Langkawi is famous with the Mahsuri legend. Let me tells you a short story about Mahsuri. She is a pretty girl that live 200 years ago, she was accused of committing adultery and was sentenced to death. She bled white blood at her execution as a sign of her innocence. Nowadays local people usually come to Makam Mahsuri (Mahsuri's Mausoleum) as a part of their vacation. A perfect place to get information on Langkawi history. Admission RM2 for adult and RM1 for child.
Have a nice trip to Langkawi Island. "Selamat Datang"
During my Langkawi vacation I also went to the Gunung Mat Cincang. A tourist spot that you should not miss. But why I said that? Of course you should not miss to walk in the cloud. At slightly over 700 meters, it is the second tallest peak in Pulau Langkawi after the 850-meter Gunung Raya. Telling you the truth I was quite nervous during the way up to the peak. The cable car only cost you RM15 for adult and RM10 for child. Perhaps the cheapest cable car fare in the world. I felt like I was on the top of the world when I reach the peak. I will never forget the view up there. You should not miss it. To go there you are advice to take cab from the hotel lobby and ask the hotel staff to arrange it for you.
Next Langkawi Underwater World, this is also one of the famous tourist spot. However I never been there but I recommend you to go there. Why? They have 5000 of marine life and displayed in 100 tanks with different size and I never heard any tourist complaint about the Langkawi Underwater World. Admission is only RM18 for adult and RM10 for child.
Continue your journey to the Galeria Perdana at Kilim. At first I thought it was just ordinary boring gallery. After my friend urge me to spent some time there, I walk in through the front door and I thought I will waste 2 hours of my Langkawi vacation in this boring gallery. But all my thought was wrong. The gallery was full with state gifts and awards presented to the Prime Minister of Malaysia, YAB Dato' Seri Dr. Mahathir Mohamad and his wife, YAB. Datin Seri Dr. Siti Wasmah bt. Mohd. Ali. I wish I was the prime minister because some of the gift worth thousands or even millions. I don't know how to describe the gift however I am very sure you will not waste your time there. Admission RM3 for adult and RM1 for child
Langkawi is famous with the Mahsuri legend. Let me tells you a short story about Mahsuri. She is a pretty girl that live 200 years ago, she was accused of committing adultery and was sentenced to death. She bled white blood at her execution as a sign of her innocence. Nowadays local people usually come to Makam Mahsuri (Mahsuri's Mausoleum) as a part of their vacation. A perfect place to get information on Langkawi history. Admission RM2 for adult and RM1 for child.
Have a nice trip to Langkawi Island. "Selamat Datang"
Unit Trust Fees: Hidden and Unhidden Costs
Sales Charge/Service Fee/Front-End Load
Whatever the term is, they all refer to the charges you pay when you invest in a unit trust. The bulk of money goes to the marketing and distribution of the fund. Generally, sales charges are reflected in the difference between the buying (bid) and selling (offer) prices and are stated as a percentage of the fund's net asset value (NAV).
A few funds in the market state the sales charges as a percentage of the selling price; in this case, you're paying more comparatively as the selling price is higher than the NAV in a front-end load fund.
Currently, average front-end load for equity funds is 5%. For bond, fixed income and money market funds usually come with a small front-end load or none at all, or an exit fee.
Back End Loads/Exit Fees/Repurchase Charge
Back-end loads or exit fees are charged when you redeem your units in the fund. In this case, the buying price is lower than the NAV.
Some back-end loads, typically those of bond funds are charged if you redeem your units before a specified period - the fee is scaled down progressively the longer you hold on to the fund.
The advantage of a back-end load is that all your money goes to work immediately. However, if the exit fee is levied against the NAV when you sell (as opposed to the original invested amount) and if you have invested for capital gains rather than income distribution, part of your profits is eaten up as well.
Management Fees
The fund company makes money from the management fees. Cited as a percentage of the fund's assets, the annual management fee is accrued daily and paid out of the fund.
Management fees for equity-oriented funds tend to be higher than those for fixed income funds. Distributors may get a small percentage of the annual management fee, referred to as a trailer fee. US personal finance magazine Kiplinger says management fees for US mutual funds are typically 1% and above.
However, management fees for passively managed funds like index-linked funds should be lower.
Trustee Fees
Trustees act as custodians of the fund and their job is to safeguard the interest of the investors. To do this, they're paid a trustee's fee, which is accrued daily. For an equity fund, the trustee's fee is typically 0.08% to 0.2% per annum.
Switching Fees
Given the volatility in markets, rebalancing is the latest investing mantra. Rebalancing involves adjusting the asset allocation in a portfolio. If you rebalance with funds within the same unit trust management company, you may incur switching fees.
Switching between funds involves the transfer of investment from one fund to another. When 'free' switches are offered, no fee will be charged for switching from one fund to another.
However, sales charges or front-end fees will still apply in some cases. For example, you'll be charged this fee when you buy into a no-load bond fund and then switch to an equity fund with a sales charge of 5%. If there's an upfront fee for both fixed income and equity funds, check whether you'll be charged the difference in up-front fees, or if you're buying at the fund's selling price and paying the whole sales charge again.
Typically, if you switch between equity funds, you'll not incur the upfront fee again as most equity funds are priced similarly. If you switch from an equity fund to a no-load bond fund, there'll also be no applicable sales charges and you buy at the NAV.
Once you exhaust the number of free switches offered in one year, there's often a switching fee, which is usually charged as 1% of the repurchase proceeds or in the form of a flat fee.
Management Expense Ratio (MER)
The MER is an indication of the costs of managing the fund. All fees incurred and deducted from the fund, including annual management fees, trustee fees, audit fees, commissions paid to brokers and printing costs; are all expressed as a percentage of the fund's net assets. MERs are important because these expenses can continue long after the up-front fee has been paid.
However, MERs can vary from company to company and category of funds. Larger funds can have lower MERs as economies of scale are achieved. Index funds should also have MERs that are lower than those of their actively managed peers' as less research is required of them; for instance, in the US, the Vanguard S&P Index Fund which has a hefty $78 billion under management, has a total expense ratio of only 0.18%.
Whatever the term is, they all refer to the charges you pay when you invest in a unit trust. The bulk of money goes to the marketing and distribution of the fund. Generally, sales charges are reflected in the difference between the buying (bid) and selling (offer) prices and are stated as a percentage of the fund's net asset value (NAV).
A few funds in the market state the sales charges as a percentage of the selling price; in this case, you're paying more comparatively as the selling price is higher than the NAV in a front-end load fund.
Currently, average front-end load for equity funds is 5%. For bond, fixed income and money market funds usually come with a small front-end load or none at all, or an exit fee.
Back End Loads/Exit Fees/Repurchase Charge
Back-end loads or exit fees are charged when you redeem your units in the fund. In this case, the buying price is lower than the NAV.
Some back-end loads, typically those of bond funds are charged if you redeem your units before a specified period - the fee is scaled down progressively the longer you hold on to the fund.
The advantage of a back-end load is that all your money goes to work immediately. However, if the exit fee is levied against the NAV when you sell (as opposed to the original invested amount) and if you have invested for capital gains rather than income distribution, part of your profits is eaten up as well.
Management Fees
The fund company makes money from the management fees. Cited as a percentage of the fund's assets, the annual management fee is accrued daily and paid out of the fund.
Management fees for equity-oriented funds tend to be higher than those for fixed income funds. Distributors may get a small percentage of the annual management fee, referred to as a trailer fee. US personal finance magazine Kiplinger says management fees for US mutual funds are typically 1% and above.
However, management fees for passively managed funds like index-linked funds should be lower.
Trustee Fees
Trustees act as custodians of the fund and their job is to safeguard the interest of the investors. To do this, they're paid a trustee's fee, which is accrued daily. For an equity fund, the trustee's fee is typically 0.08% to 0.2% per annum.
Switching Fees
Given the volatility in markets, rebalancing is the latest investing mantra. Rebalancing involves adjusting the asset allocation in a portfolio. If you rebalance with funds within the same unit trust management company, you may incur switching fees.
Switching between funds involves the transfer of investment from one fund to another. When 'free' switches are offered, no fee will be charged for switching from one fund to another.
However, sales charges or front-end fees will still apply in some cases. For example, you'll be charged this fee when you buy into a no-load bond fund and then switch to an equity fund with a sales charge of 5%. If there's an upfront fee for both fixed income and equity funds, check whether you'll be charged the difference in up-front fees, or if you're buying at the fund's selling price and paying the whole sales charge again.
Typically, if you switch between equity funds, you'll not incur the upfront fee again as most equity funds are priced similarly. If you switch from an equity fund to a no-load bond fund, there'll also be no applicable sales charges and you buy at the NAV.
Once you exhaust the number of free switches offered in one year, there's often a switching fee, which is usually charged as 1% of the repurchase proceeds or in the form of a flat fee.
Management Expense Ratio (MER)
The MER is an indication of the costs of managing the fund. All fees incurred and deducted from the fund, including annual management fees, trustee fees, audit fees, commissions paid to brokers and printing costs; are all expressed as a percentage of the fund's net assets. MERs are important because these expenses can continue long after the up-front fee has been paid.
However, MERs can vary from company to company and category of funds. Larger funds can have lower MERs as economies of scale are achieved. Index funds should also have MERs that are lower than those of their actively managed peers' as less research is required of them; for instance, in the US, the Vanguard S&P Index Fund which has a hefty $78 billion under management, has a total expense ratio of only 0.18%.
How to Choose a Unit Trust
For many people with available assets who are shopping for secure and unobtrusive ways to invest, unit trusts may be a solution. They are generally considered to be a safe investment avenue, as the risks as well as the profits are shared mutually among the pool of investors who hold interest in them.
These trusts most often are stock market or money market instruments into which any number of investors may pool their funds to buy shares, or units. These trusts are open-ended, where the size of the fund grows or declines based on the number of investors in the pool.
Trust schemes are offered and managed by investment firms and financial groups which are authorized by The Financial Services Authority, or FSA. These managers decide which bonds or securities to invest in, and use their knowledge and experience to select the most profitable and secure financial instruments. There are various firms which offer trust schemes and the curious investor should do some shopping to select the proper scheme for their purposes.
The entry fee, if you will, to join a unit trust requires a reasonable lump sum payment followed by a nominal monthly donation to the fund to increase the investing power of the shared funds. The advantage here is that the outright purchase of the bonds or other stock shares which a fund manager chooses to invest in would cost many times more than the initial lump sum payment and monthly donations combined.
Of course, any profits paid out to the pool of investors are taxable under the regular capital gains tax schemes normally applied to any investment asset, and processing and management fees are also deducted before profits are distributed to the investors.
These trusts most often are stock market or money market instruments into which any number of investors may pool their funds to buy shares, or units. These trusts are open-ended, where the size of the fund grows or declines based on the number of investors in the pool.
Trust schemes are offered and managed by investment firms and financial groups which are authorized by The Financial Services Authority, or FSA. These managers decide which bonds or securities to invest in, and use their knowledge and experience to select the most profitable and secure financial instruments. There are various firms which offer trust schemes and the curious investor should do some shopping to select the proper scheme for their purposes.
The entry fee, if you will, to join a unit trust requires a reasonable lump sum payment followed by a nominal monthly donation to the fund to increase the investing power of the shared funds. The advantage here is that the outright purchase of the bonds or other stock shares which a fund manager chooses to invest in would cost many times more than the initial lump sum payment and monthly donations combined.
Of course, any profits paid out to the pool of investors are taxable under the regular capital gains tax schemes normally applied to any investment asset, and processing and management fees are also deducted before profits are distributed to the investors.
HOME :: Internet-and-Businesses-Online Passive Income - 5 Ways Of Generating Passive Income - Part 1
Definition of Passive Income is "Income generated with minimal work from your investments such as interest, dividends, or real estate rentals."
Passive Residual Income is another term normally used by investors. It is defined by income derived from working hard once but receiving the income continuously.
The benefits are 1. You only work one time and the income will flow in in a timely manner, be it monthly or yearly or longer 2. You can work your normal way and still earn more at the end of the day. Your passive residual income is not dependent on a 9-5 work week and can be generated 24 hours, 7 days a week. 3. Freedom to choose when and where you wish to work. 4. Create unlimited amount of income; the more you put your effort in, the more you earn 5. Create residual income for your future retirement.
It is our key to financial freedom. We will be less dependent we are on our job when we have more than one streams of passive income. When our the income exceeds our expenses, we can stop working anytime we want and can still live the desired lifestyle. That is financial freedom.
There are many types around that you can source.
The five ways of generating Passive Income especially for Malaysians are 1. Dividend from Investments a. Invest in Cooperative Banks such as Bank Persatuan and Bank Rakyat Bank Persatuan is new for Klang Valley area but it has been in existence in the 50s, originally in the North of Malaysia. b. Invest in Amanah Saham Bumiputera (ASB) introduced by Permodalan National Berhad (PNB)
2. Income from Investment in Unit Trust. There are many reputable Unit Trust available in the market organized by Unit Trust companies such as Public Mutual, CIMB Wealth Advisor, MAAKL Mutual etc. They offer a variety of unit trust catering for each individual needs
3. Rental from Real Estate. This means that you buy Properties and let the Properties out to tenants. The consistent rental from will give a good source of passive income.
4. Royalties from publishing a book Writing a book will enable you earn commissions from the publishers. Royalties is another good source of income as you really work one time. If your books have lots of information that people need, they will be utilized, searched, bought and printed repeatedly.
5. Internet Marketing Internet Marketing has been around for the last 10 - 15 years. The demand is very good as people always search for information eg where to buy things, do internet banking transactions
Passive Residual Income is another term normally used by investors. It is defined by income derived from working hard once but receiving the income continuously.
The benefits are 1. You only work one time and the income will flow in in a timely manner, be it monthly or yearly or longer 2. You can work your normal way and still earn more at the end of the day. Your passive residual income is not dependent on a 9-5 work week and can be generated 24 hours, 7 days a week. 3. Freedom to choose when and where you wish to work. 4. Create unlimited amount of income; the more you put your effort in, the more you earn 5. Create residual income for your future retirement.
It is our key to financial freedom. We will be less dependent we are on our job when we have more than one streams of passive income. When our the income exceeds our expenses, we can stop working anytime we want and can still live the desired lifestyle. That is financial freedom.
There are many types around that you can source.
The five ways of generating Passive Income especially for Malaysians are 1. Dividend from Investments a. Invest in Cooperative Banks such as Bank Persatuan and Bank Rakyat Bank Persatuan is new for Klang Valley area but it has been in existence in the 50s, originally in the North of Malaysia. b. Invest in Amanah Saham Bumiputera (ASB) introduced by Permodalan National Berhad (PNB)
2. Income from Investment in Unit Trust. There are many reputable Unit Trust available in the market organized by Unit Trust companies such as Public Mutual, CIMB Wealth Advisor, MAAKL Mutual etc. They offer a variety of unit trust catering for each individual needs
3. Rental from Real Estate. This means that you buy Properties and let the Properties out to tenants. The consistent rental from will give a good source of passive income.
4. Royalties from publishing a book Writing a book will enable you earn commissions from the publishers. Royalties is another good source of income as you really work one time. If your books have lots of information that people need, they will be utilized, searched, bought and printed repeatedly.
5. Internet Marketing Internet Marketing has been around for the last 10 - 15 years. The demand is very good as people always search for information eg where to buy things, do internet banking transactions
Safe And Reliable - Unit Trust
Iam very sure that you know that you can increase your wealth from investment. When you hear the word investment, are you thinking about stocks and shares? People get skeptical about shares thinking that one will definitely lose money from shares because of the risk level. However, if someone tells you that there are investments that have little or no risk; do you think its bond?
Personally, I am not a fan of bonds or fixed income securities. Investing in bonds is a waste of time and sometimes, money. However, the best investment that I truly love because of the transparency and returns are unit trust. Another term for unit trust is mutual funds.
A unit trust is a legal trust that holds investments and other assets for the benefit of the unit holder that share similar investment objective. The investment portfolio is managed by a professional fund management firm that strives to meet investment goals of the unit holders.
The unit trust is divided into equal portions called units. Investors buy and sell these units from the manager of the unit trust. A unit trust is constituted by a trust deed.
There are advantages and disadvantages of investing in unit trust. In fact in any kind of investment, there are advantages and disadvantages. Unit trust serves investors who do not have much financial knowledge on investment. As unit trust is handled by a professional fund management, people who spend time and money to study about investment, I am sure your money is in the safe hands.
Advantages for unit trust are affordability, professional investment expertise, diversification, liquidity, security, convenience and compatibility. Where else disadvantages for unit trust are risk (all investments have risk), level of attention and high cost base.
There are other factors to consider too when investing in unit trust but these are some of the features that can be considered the next time you want to invest.
Personally, I am not a fan of bonds or fixed income securities. Investing in bonds is a waste of time and sometimes, money. However, the best investment that I truly love because of the transparency and returns are unit trust. Another term for unit trust is mutual funds.
A unit trust is a legal trust that holds investments and other assets for the benefit of the unit holder that share similar investment objective. The investment portfolio is managed by a professional fund management firm that strives to meet investment goals of the unit holders.
The unit trust is divided into equal portions called units. Investors buy and sell these units from the manager of the unit trust. A unit trust is constituted by a trust deed.
There are advantages and disadvantages of investing in unit trust. In fact in any kind of investment, there are advantages and disadvantages. Unit trust serves investors who do not have much financial knowledge on investment. As unit trust is handled by a professional fund management, people who spend time and money to study about investment, I am sure your money is in the safe hands.
Advantages for unit trust are affordability, professional investment expertise, diversification, liquidity, security, convenience and compatibility. Where else disadvantages for unit trust are risk (all investments have risk), level of attention and high cost base.
There are other factors to consider too when investing in unit trust but these are some of the features that can be considered the next time you want to invest.
Introduction to Unit Trust
What are Unit Trusts?
Unit Trusts are a form of collective investment that allows investors with similar investment objectives to pool their funds to be invested in a portfolio of securities or other assets.
The manager of the fund then invests the pooled money in a portfolio which may include the asset classes such as Cash, Bonds & Deposits, Shares, Property and Commodities.
Benefits Of Unit Trust
It is tough for an individual to maintain his own portfolio of investments, he needs to keep up to date with market information and sentiment.
By investing in unit trusts most of the necessary 'know-how' of investing are transferred to those best equipped to handle it i.e. the professional fund managers.
The advantages and benefits of investing in unit trusts are:
Diversification
A larger pool of funds allows the fund manager managing the unit trust to purchase a wider range of investments. Rather than concentrating an investment portfolio into one or two investments or shares, a portfolio of market securities can be held. The wider the spread of investments, the less volatile (i.e. variable) the investment returns will be. In simple terms, investment into unit trusts means diversification of risk: "not putting all your eggs in one basket."
Liquidity
Most investors require that their investment be liquid. That is, they can easily buy and sell within a short period of time. Unit trusts provide this benefit, being bought and sold easily. An excellent return that cannot be "cashed-in" (i.e. sold) does not necessarily mean a good investment as poor liquidity constitutes an additional risk factor for the investor.
Professional Fund Management
The people making investment decisions for unit trust holders are professionals. Their training and background ensures that decision making is structured and according to basic investment principles. In the process, unit trust funds enjoy the depth of knowledge and experience that fund manager bring. In the long term, it is this expertise that should generate above average investment returns for unit trust investors.
Affordable and Investment Exposure
For the individual investor, it is sometimes difficult to gain exposure to a particular asset class. For instance, if an investor with USD3,000 wanted to gain exposure to the property market, global equity markets and bond market, it would be impossible to simultaneously hold a direct investment portfolio in all of these markets. With unit trust investments, it is possible to spread your money around to all of these asset classes at the same time, so that the investor can gain the investment exposure he requires.
Wholesale Investment Costs & Access to Investments
When making small investments, the investor faces costs and charges that are much higher. Unit trust funds are investing with large amounts, so that the economics of the transaction are more favorable i.e. the fees and charges/brokerage etc. per investment ringgit are likely to be less.
Also, because fund managers invest in larger amounts, they are able to get access to wholesale yields and products which are impossible for the individual investor to obtain.
Funds for All Type of People
There are many different types of funds that will suit to any level of risk to cater different type of people.
Safe and Secure
Unit Trusts only make investment and do not give out loans thus, the situation where liabilities more than assets will never arise.
More free time
Yes, we have to monitor our investment performance but since the fluctuation of the unit trust fund is not as frequent as stock market and that we have our Professional Fund Manager to look after the investment, we may keep track the fund on a weekly basis. More free time for us.
Attractive Returns
Unit Trust has proven that it is an excellence hedge against inflation. Unit Trust in some countries has shown a return of between 10% to 15%.
Unit Trusts are a form of collective investment that allows investors with similar investment objectives to pool their funds to be invested in a portfolio of securities or other assets.
The manager of the fund then invests the pooled money in a portfolio which may include the asset classes such as Cash, Bonds & Deposits, Shares, Property and Commodities.
Benefits Of Unit Trust
It is tough for an individual to maintain his own portfolio of investments, he needs to keep up to date with market information and sentiment.
By investing in unit trusts most of the necessary 'know-how' of investing are transferred to those best equipped to handle it i.e. the professional fund managers.
The advantages and benefits of investing in unit trusts are:
Diversification
A larger pool of funds allows the fund manager managing the unit trust to purchase a wider range of investments. Rather than concentrating an investment portfolio into one or two investments or shares, a portfolio of market securities can be held. The wider the spread of investments, the less volatile (i.e. variable) the investment returns will be. In simple terms, investment into unit trusts means diversification of risk: "not putting all your eggs in one basket."
Liquidity
Most investors require that their investment be liquid. That is, they can easily buy and sell within a short period of time. Unit trusts provide this benefit, being bought and sold easily. An excellent return that cannot be "cashed-in" (i.e. sold) does not necessarily mean a good investment as poor liquidity constitutes an additional risk factor for the investor.
Professional Fund Management
The people making investment decisions for unit trust holders are professionals. Their training and background ensures that decision making is structured and according to basic investment principles. In the process, unit trust funds enjoy the depth of knowledge and experience that fund manager bring. In the long term, it is this expertise that should generate above average investment returns for unit trust investors.
Affordable and Investment Exposure
For the individual investor, it is sometimes difficult to gain exposure to a particular asset class. For instance, if an investor with USD3,000 wanted to gain exposure to the property market, global equity markets and bond market, it would be impossible to simultaneously hold a direct investment portfolio in all of these markets. With unit trust investments, it is possible to spread your money around to all of these asset classes at the same time, so that the investor can gain the investment exposure he requires.
Wholesale Investment Costs & Access to Investments
When making small investments, the investor faces costs and charges that are much higher. Unit trust funds are investing with large amounts, so that the economics of the transaction are more favorable i.e. the fees and charges/brokerage etc. per investment ringgit are likely to be less.
Also, because fund managers invest in larger amounts, they are able to get access to wholesale yields and products which are impossible for the individual investor to obtain.
Funds for All Type of People
There are many different types of funds that will suit to any level of risk to cater different type of people.
Safe and Secure
Unit Trusts only make investment and do not give out loans thus, the situation where liabilities more than assets will never arise.
More free time
Yes, we have to monitor our investment performance but since the fluctuation of the unit trust fund is not as frequent as stock market and that we have our Professional Fund Manager to look after the investment, we may keep track the fund on a weekly basis. More free time for us.
Attractive Returns
Unit Trust has proven that it is an excellence hedge against inflation. Unit Trust in some countries has shown a return of between 10% to 15%.
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