55) Why You Should Consider Investing in Unit Trust Funds?
We always wanted our money to work harder for us. All investments have returns and risks. How much risks you are willing to take will determine the returns you will get
Investment in the Unit Trust fund have its returns and risks as well. So, how to consider should you invest in a Unit Trust Equity fund?
One idea you can consider…
You can look at the history of the investments in the long term and analyze the records.
You are reminded that Past Performance is not an indication of Future Performance.
The FBMKLCI is commonly used as a benchmark for many Equity funds. The KLCI is an index used to reflect Malaysia’s stock market performance. The KLCI had up and down periods because the listed companies had good times and bad times.
When the period is good, stock prices go up, the KLCI index goes up. When the period is bad, stock prices go down, the KLCI index goes down.
Over the long period of many years, the number of good years are more than bad years. Also, the percentage returns in good years are much higher than the percentage losses in bad years.
Over many years, stock markets all over the world had been going uptrend. The KLCI started with 100 points in 1 Jan 1977 and was at around 1770 on 25 May 2017.
Let's calculate the returns ratio: 1770 / 100 = 17.7
In 40 years, the KLCI had grown 17.7 times. In another perspective, RM100 invested in KLCI in Jan 1977 was worth RM1770 in May 2017.
As another comparison, if you had saved or invested RM100 for last 15 years, since May 2002 until May 2017, the estimated amount in various investments and savings are as below:
a) Fixed Deposit is around RM160 (Green line) grown to 1.6 times.
b) FBMKLCI is around RM220 (Red line) grown to 2.2 times. (100 + 110% Return)
c) Unit Trust Equity fund is around RM310 (Blue line) grown to 3.1 times.
Do bear in mind that the Malaysia stock market, reflected by the FBMKLCI, had passed through many bad times in 2002, 2008, 2011 and 2015.
Look the attached graphs of a sample investment started with RM100 since May 2002.
In conclusion, money will grow when you make it work for you. You can invest it or save in the bank.
It is also important to know where to invest. Be careful of the investment scams that promises high return and with no risk or little risk.
There is a saying,
"If something seems too good to be true, it probably is."
It means that a promise of high return is most probably cannot be true.
There is always risk and return. Higher risk normally will give you higher return.
Unit Trusts investments in Malaysia are regulated by the Securities Commission. There are many rules and regulations to be followed. The more rules there are, the safer the investment is.
#highlevelrules
You can look at the history of the investments in the long term and analyze the records.
You are reminded that Past Performance is not an indication of Future Performance.
The FBMKLCI is commonly used as a benchmark for many Equity funds. The KLCI is an index used to reflect Malaysia’s stock market performance. The KLCI had up and down periods because the listed companies had good times and bad times.
When the period is good, stock prices go up, the KLCI index goes up. When the period is bad, stock prices go down, the KLCI index goes down.
Over the long period of many years, the number of good years are more than bad years. Also, the percentage returns in good years are much higher than the percentage losses in bad years.
Over many years, stock markets all over the world had been going uptrend. The KLCI started with 100 points in 1 Jan 1977 and was at around 1770 on 25 May 2017.
Let's calculate the returns ratio: 1770 / 100 = 17.7
In 40 years, the KLCI had grown 17.7 times. In another perspective, RM100 invested in KLCI in Jan 1977 was worth RM1770 in May 2017.
As another comparison, if you had saved or invested RM100 for last 15 years, since May 2002 until May 2017, the estimated amount in various investments and savings are as below:
a) Fixed Deposit is around RM160 (Green line) grown to 1.6 times.
b) FBMKLCI is around RM220 (Red line) grown to 2.2 times. (100 + 110% Return)
c) Unit Trust Equity fund is around RM310 (Blue line) grown to 3.1 times.
Do bear in mind that the Malaysia stock market, reflected by the FBMKLCI, had passed through many bad times in 2002, 2008, 2011 and 2015.
Look the attached graphs of a sample investment started with RM100 since May 2002.
In conclusion, money will grow when you make it work for you. You can invest it or save in the bank.
It is also important to know where to invest. Be careful of the investment scams that promises high return and with no risk or little risk.
There is a saying,
"If something seems too good to be true, it probably is."
It means that a promise of high return is most probably cannot be true.
There is always risk and return. Higher risk normally will give you higher return.
Unit Trusts investments in Malaysia are regulated by the Securities Commission. There are many rules and regulations to be followed. The more rules there are, the safer the investment is.
#highlevelrules
No comments:
Post a Comment