Understanding Unit Trust

Today we will learn about what unit trust is all about. We will look at the structure, the advantages, the disadvantages, and what I think about unit trust.

In the most simplistic sense, unit trust is a medium where people (investors) pool their money to be invested in the financial markets.

Around the world, there are many other terms that are similar to unit trust. Some are called mutual funds, managed funds, and investment companies. The difference between them is just the legal structure whereby unit trusts are being run under the TRUST structure while others are run under the COMPANY structure.

STRUCTURE

Firstly, let’s talk about a structure that most of us are familiar with, which is the company structure. Assume there’s this company called Blogobob Sdn. Bhd. The company’s primary business is to sell Nasi Lemak. The company are run by the management team and being supervised by the board of directors. The company’s objective is to make money for its shareholders (obviously..). Have a look at the COMPANY structure below:

Company

Now, let’s have a look at a fantasy Unit Trust fund named Blowspot Ittikal Fund. Its primary business is obviously to make investments. Have a look at the UNIT TRUST structure below:
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My Blog is 3 months old and I’m back in Brisvegas!

Wow, it’s been a while since I have last updated my blog. Been kind of busy lately.

Anyway, I returned to Australia a few days ago. My flight was on the evening of 23rd January. I arrived on the 24th. As usual, it was a pretty boring and frustrating flight. Nothing to do on board the Air Asia’s D7 2702. Did a bit of reading and most of the time, was trying to sleep. I wonder how some people can just doze off and not wake up for hours!

While the cabin crews were serving the food, I heard some pretty interesting conversation between them. There’s this gal named ‘R‘, she said to the other crew..

“Yang, yang…. I ada bonus question untuk you…”

“Tadi, ada passenger tanya I.. Ni coffee I serve ni instant ke..”

“Dia orang ni… Mesti lah instant… Mana ada masa nak brew coffee masa masa macam sekarang ni..”

Hehe. Ada masa pulak kutuk passengers!

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My Investments with Public Mutual

In a previous article on Public Mutual, I talked about my first unit trust investments.

Yesterday, I added some more to my investments. The usual routine took place whereby my unit trust consultant came to my house, we chatted a little, signed a few forms, and my consultant goes away with a smile on her face (because of the commissions of course). Hehe.

An interesting information to share, she told me that beginning from January 2008, the service charge for individual investors has been reduced to 5.5% and for EPF investors, around 3%. That’s good news for the investors (still a bit too high) but bad for the unit trust consultants because of reduced commissions ๐Ÿ˜‰

I topped up my current holdings of Public Asia Ittikal Fund (PAIF) and Public Islamic Dividend Fund (PIDF).

I also invested in 5 new funds of various risk profiles and investment strategies. They are:

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First Taste of Dragonfruit

Today, I had my first taste of dragonfruit. Been a while since I wondered about what sort of fruit it is and how it tastes like. Anybody knows how the fruit came about in Malaysia?

So, I went to the nearest shopping mall yesterday, and got me one. Yeah, one. Why one? Because it cost me a fortune! One dragonfruit will set you back RM3.29 (around AUD1.10).

So, my verdict? It’s not that bad really. Quite nice. I don’t really know how to describe the taste. Fair to say, I didn’t hate it. Though you wouldn’t catch me eating dragonfruits again anytime soon because of the cost factor! Perhaps next time I’ll eat one of these babies is when I grow them myself. Haha.

Here you go, a picture of the fruit.

On another matter, sadly, I still haven’t had lobsters (click to read my sad story) yet… Haih… Tried to convince my parents, but they brought me to some food court selling RM2.50 Cantonese Kuey Teow instead. It’s ok, it’s ok, I’m going to use the Law of Attraction as prescribed in Ronda Byrne’s The Secret to attract some nice luscious lobsters to come to me. Hehe.

By the way, today, I topped up my unit trust investment and invested in some new funds as well. Will write about that sometime tomorrow.

Till then folks…

I’ve Been Tagged

I’ve been tagged for the first time by Kate. Thanks Kate ๐Ÿ™‚

1. Do the following without complains.
2. Choose 5 people to do this quiz after youโ€™ve done yours.
3. Tag the chosen one.
4. Start your post with โ€œIโ€™ve been tagged”

Favourites
Colour ~ Black and Red
Food ~ My mum’s Nasi Lemak
Movie ~ Paris Je T’aime
Sport ~ Golf and Badminton
Day ~ Gloomy Rainy Day… ahhh… love it..
Season ~ Autumn
Ice cream ~ Chocolate

First
Crush ~ Haha. Nice try. Not going to tell you.
Movie ~ Can’t recall. But first movie in the cinema, it was Jurassic Park. Had nightmares after that.
Music ~ Can’t remember

Last
Drink ~ Iced Water saja…
Phone call ~ My unit trust consultant
CD played ~ I don’t buy CDs. Guess where I get my songs from? ๐Ÿ˜‰
Gone out with good friends ~ Freakin’ long time ago
Broken a law ~ Am a law abiding citizen ๐Ÿ˜›
Been arrested ~ Never.

Now I’ll tag ~ Amir, Irdzra, Dr. N, Sting, Fisha

Amanah Saham Wawasan 2020 : ASW 2020

Included in the long list of Permodalan Nasional Berhad’s (PNB) long list of unit trust products is the Amanah Saham Wawasan 2020, or simply ASW 2020.

Amanah Saham Wawasan 2020. I mean, how cool does that sound! Vision 2020 Unit Trust. Sounds so…. out of the ordinary huh?

What’s next? The Terminator 2050 Fund. Investment strategy, to invest in all companies related with uranium, especially in those specialising in nuclear warheads? Haha. That would be something huh?

Anyway, back to ASW 2020, this is another fund that offers the capital guarantee feature. Considering the low-risk nature, the returns from this fund is not so bad. However, I’m sure all of you would agree that if you’re a Bumiputera, ASB is at the top of your priority list.

Below are some of the features of ASW 2020:

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Why I’m not so fond of ‘off-the-plan’ projects

A couple of days ago, I saw this news on TV3’s Buletin 1.30 about an abandoned property development project somewhere in Petaling Jaya.

Property development projects being abandoned. One of the reasons why I’m not really into off-the-plan projects. Another reason is that my hard-earned money is not put to work until the project is actually completed.

Yes, there are money to be made from off-the-plan housing developments. However, from the “enjoying the rental income” perspective, I don’t see this materialising quick enough. You might say, come on Nadlique, patience is key. Yes, that is true, but why would I invest my money somewhere where I can’t enjoy the rewards now, when I can invest that same amount of money someplace else, with a comparable amount of risk, and enjoy the benefits immediately?

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