April 10, 2009

CIMB AirAsia Savers Account

CIMB Bank launched a new savings account in partnership with AirAsia yesterday, which provides high interest rate (up to 2% p.a.), free prepaid Tune Card with first year annual fee waiver as well as privileges for AirAsia promotions.

For more details, please see here.

April 9, 2009

AmConstant Extra Bond Fund

AS INTEREST rates globally continue to fall and are expected to stay low at least this year, AmInvestment Bank Group is starting a bond fund aimed at "preserving wealth".

"Amid the turbulent financial times and falling interest rates, investors prefer bonds and bond funds as safe haven investment tools," chief executive officer at the funds management division Datin Maznah Mahbob said in Kuala Lumpur yesterday. The division manages RM16 billion at the end of March.

"Bonds had overtaken equities as the preferred asset class amid the current volatile market," Maznah said, citing a recent poll by a regional online unit trust portal which has a presence in Malaysia, Singapore and Hong Kong.

Central banks around the world are likely to keep slashing interest rates this year to boost the weak economy and chances are high that interest rates will remain low next year, head of Asian Fixed Income at the bank, Julian Chow said.

With a RM200 million approved size, the AmConstant Extra is benchmarked against the current fixed deposit (FD) rates and aims to provide investors with regular income throughout the tenure.

Up to 99 per cent of the fund will buy debt papers issued by the Malaysia government and local corporates rated "BBB" and above. It may also invest in foreign papers and US dollar convertible bonds that are rated or unrated. The fund adopts a buy and hold strategy where investments are held to maturity.

"We have a strong credit team with a track record in picking up quality papers. All our funds have never experienced a credit default before," Maznah said.

The new fund is targeted at risk-averse investors who seek potentially higher returns than the FD, but less risky unit trust compared to equity funds.

Source: BusinessTimes

For more details about the new fund, click here.

Comments: For a bond fund that intends to beat the fixed deposit rates and yet charge 2% sales charge, i guess this fund is not worth the investment, in my opinion. The fees alone are probably enough to offset the difference between the gain of the fund and the FD rates.

April 8, 2009

Bank Negara To Issue RM2.5 Billion Sukuk Simpanan Rakyat

The Finance Ministry today announced the issuance of Sukuk Simpanan Rakyat 01/2009 amounting to RM2.5 billion on May 14, 2009.

This is the first issue of the two series of three-year RM2.5 billion sukuk each and it will be issued by Bank Negara Malaysia on behalf of the government, the ministry said.

The sukuk, which will be scripless and based on Syariah principles, is an additional investment instrument for Malaysian citizens who are 21 years and above, it said in a statement.

The sukuk offers a return of 5.0 percent per annum and provides the flexibility for early redemption before the maturity date, the ministry said.

It is available for subscription during the sales period from April 14 to May 13, 2009.

The minimum investment is RM1,000 with a maximum of RM50,000 per investor and the maximum aggregate holdings per investor for the two sukuk series is RM50,000, the ministry said.

It can be subscribed at all commercial banks, including Islamic banks, Bank Kerjasama Rakyat Malaysia Bhd, Bank Simpanan Nasional and Bank Pertanian Malaysia Bhd.

Allocation for the sukuk is based on a first-come first-served basis, and successful applicants will be notified by their agent banks.

Profit payments will be made on a quarterly basis via the sukuk holders' accounts with their agent banks.

Those seeking further information can contact Bank Negara's Telelink at 1300-88-5465 or by visiting the websites www.treasury.gov.my and www.bnm.gov.my/sukuksimpanan.

Source: Bernama

April 7, 2009

Asset Allocation - End of March

As mentioned in the previous post, my initial target allocation of my unit trust funds is as follow:

However, on end of March, I've modified my target allocations to increase the percentage of Public Far East Select Fund (PFES) from 7% to 10% and on the same time, reduce the weight age of OSK KLCI Tracker (Tracker) fund to 10%. This is due to expected positive outlook of returns for Asia Pacific markets and rather subdue performance of Bursa Malaysia of late. The new target asset allocation of my portfolio is as below:

Below is the asset allocation of my unit trust funds portfolio as of end of March.

As you can see, most of my funds are still underperforming and below my target asset allocation percentage, except for fixed income funds. As for Pheim Income Fund, I have yet to reduce the weight age of this fund in my portfolio since this fund has been holding up well to act as a performance buffer to my overall portfolio and also due to the volatility of stock markets. PFES and HGEMF are also performing well in March by gaining 6% and 8% respectively in my portfolio.

I do foresee more investments in those funds which are below the targeted allocation in the coming months especially when the market corrects heavily. I am looking at the window of opportunity sometime in April or May which had seen very selloff for the past two to three years.

The RM1 solution to job losses

That RM1 may not buy a glass of teh tarik but it could go a long way to help those laid off.

AmResearch economist Manokaran Mottain has suggested raising RM11 million for a retrenchment fund if every worker in Malaysia gives RM1.

"The government could match the amount with another RM11 million," he said in a report.

The fund would be similar to the S$20 million (S$1 = RM2.37) fund being considered by the labour movement in Singapore with the help of its cooperatives, affiliated unions and unionised companies.

It could help the jobless in the short term, say up to six months, and this could be used to cover utility bills or children's school expenses.

The government plans to create 163,000 training and job placement opportunities in the public and private sectors as announced under its mini-Budget on March 10.

AmResearch argues that the mini-Budget is not enough and it proposed a third stimulus of RM15 billion by September. The government said the economy could expand or shrink by 1 per cent this year but Manokaran thinks the fall could double. In its worst case scenario, the gross domestic product, the sum total of goods and services, could fall by 4.5 per cent.

Factories in Malaysia have been hit hard by weak demand for the country's key technology exports.

"Given larger losses in export earnings and weakening consumer and business confidence amid rising unemployment following closures of manufacturing concerns and increasing voluntary separation schemes in the financial industry, we maintain our view that private sector demand, especially private consumer spending, will remain weak for next couple of years."

Since October 2008, 25,000 workers have been retrenched, 30,900 temporarily laid off, 23,900 had pay cuts, and 100,000 were not given overtime.

As orders continue to fall, retrenchment for 2009 alone could easily exceed 100,000 (including temporary layoffs and termination of contract workers).

In January, 15,000 jobs were lost in Malaysia, mostly in the electronics industry.

Last month, Flextronics International, one of the world's largest contract manufacturers, shut down an assembly plant in Shah Alam and laid off 1,382 workers.

Public Select Alpha-30 Fund

High quality stocks at low prices – it’s the perfect combination. And you can zoom in on 30 of them through the Public Select Alpha-30 Fund, and look forward to potentially good capital growth over the medium to long term.

  • Aims to achieve capital growth by investing in up to a maximum of 30 stocks primarily listed on Bursa Securities.
  • To achieve increased diversification, the fund may invest in selected foreign markets such as Singapore, Taiwan, South Korea, Japan, Australia, New Zealand, Hong Kong, China, Thailand, Indonesia, Philippines and other markets.
  • Equity exposure: generally range from 75% to 95% of its net asset value (NAV).
  • Initial Issue Price is RM0.25 per unit during offer period (7 – 27 April 2009).
  • Suitable for investors with aggressive risk-reward temperament.
  • Fund objective: To achieve capital growth over the medium to long term period by investing in up to a maximum of 30 stocks primarily listed on Bursa Securities.
  • Service charge: Up to 5.5% of NAV per unit (after promotion period)
  • Minimum initial investment: RM1,000
  • Additional investment: RM100
Source: Public Mutual

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