An Analysis of My Own Investment into Unit Trust


Just to share an analysis for my own EPF investment into unit trust.

a) EPF allows us to withdraw money from Account 1 for investment every 3 months, so I invested RM5,300 on 5th Jan 2009, & RM5,100 on 4th April 2009, i.e. total RM10,400.

b) Unrealised profit as of 27th July 2009 is RM1,546.50, or 14.87% (within 7 months)

c) Optimism in the world market is very good; read Hong Kong Market at 10-month highEurope Roundup: Highest since November 2008.

d) What EPF allows us to do is a good thing, i.e. regular investment at fixed interval, giving us the benefit of Dollar Cost Averaging.

Dollar cost averaging is a timing strategy of investing equal dollar amounts regularly and periodically over specific time periods (such as $100 monthly) in a particular investment or portfolio. By doing so, more shares are purchased when prices are low and fewer shares are purchased when prices are high. The point of this is to lower the total average cost per share of the investment, giving the investor a lower overall cost for the shares purchased over time.[1]

Dollar cost averaging is also called DCA and constant dollar plan in the USpound-cost averaging in the UK, and by the currency-neutral term cost average effect[2].

(source wikipedia)

e)  Economic cycle-recovery.

We are in the phase of economic recovery, following recent economic crisis, so it will take another 8-11 years before we might experiencing something as bad as last year, theoretically.  Hence it is a very good time to ride the recovery by investing regularly at relatively lower price.

History on economic cycles

In 1860, French economist Clement Juglar identified the presence of economic cycles 8 to 11 years long, although he was cautious not to claim any rigid regularity.[2] Later, Austrian economist Joseph Schumpeter argued that a Juglar cycle has four stages: (i) expansion (increase in production and prices, low interests rates); (ii) crisis (stock exchanges crash and multiple bankruptcies of firms occur); (iii) recession (drops in prices and in output, high interests rates); (iv) recovery ( stocks recover because of the fall in prices and incomes). In this model, recovery and prosperity are associated with increases in productivity, consumer confidence, aggregate demand, and prices.

(source wikipedia)

f) Well, all things said, it is up to you now whether to grab this chance or not. Open to cash or EPF investment. Minimum RM1K initial investment, additional investment RM100 (cash) or RM1K EPF.

g) Most important- it is syariah based investment.

Happy investing, contact 019-985 5546 for further details.


One response to “An Analysis of My Own Investment into Unit Trust

  1. Pingback: Hukum Pelaburan Dalam Amanah Saham Bumiputera (ASB) « Takaful-Smart-Medic-100-Guide

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