No trust in unit trust funds
Dong Kerapu SamadPublished: Aug 18, 2004 1:57 PM | Updated: Jan 29, 2008 6:21 PM
I agree with Ng Shu Tsuing that unit trust funds are actually not investments but a gamble and most of the investing public are ill-informed of the risks involved.
Indeed, many of those who had been lured to withdraw their Employee Provident Fund (EPF) funds during the earlier part of the 1997 financial crisis are now worse off by at least 30 percent of the principal sum.
This includes all those who invested in non-principal guaranteed unit trust funds including those sold by Permodalan Nasional Berhad (PNB) such as Amanah Saham Nasional.
Many of the fund managers hardly service their clients properly. For instance, many of them fail to send out regular statements and investment portfolio positions.
Cleints are not given the benefit of advisory services on whether they should cut their losses or switch to other alternative investments such as other funds, bonds and papers.
There are also cases where investors do not know the latest addresses and names of their fund managers following the recent spate of mergers of banks and financial institutions in the country.
My observation is that unit trust schemes have been a disaster for many, especially those who withdrew their savings from the EPF to invest.
In the light of this, it is important that the EPF and regulatory authorities review the existing guidelines for the withdrawal of EPF funds for the purpose of investing in unit trusts and other alternative forms of investments.
What is important is to ensure that investors are advised by qualified investment advisors with recognised qualifications and experience in the field.
This minimum standard of professionalism and due care must be set out clearly to prevent members of the public from losing their hard earned savings in the market place.
All unit trust sales agents and those who offer any form of investments for sale to the public must satisfy certain minimum requirements and they also need to be licenced by the appropriate authority.
It is suggested the Malaysian Securities Exchange Berhad and the Malaysian Institute of Banks conduct their own postgraduate diplomas in wealth management to provide investment advisors with the desired level of knowledge and skill.
Indeed, many of those who had been lured to withdraw their Employee Provident Fund (EPF) funds during the earlier part of the 1997 financial crisis are now worse off by at least 30 percent of the principal sum.
This includes all those who invested in non-principal guaranteed unit trust funds including those sold by Permodalan Nasional Berhad (PNB) such as Amanah Saham Nasional.
Many of the fund managers hardly service their clients properly. For instance, many of them fail to send out regular statements and investment portfolio positions.
Cleints are not given the benefit of advisory services on whether they should cut their losses or switch to other alternative investments such as other funds, bonds and papers.
There are also cases where investors do not know the latest addresses and names of their fund managers following the recent spate of mergers of banks and financial institutions in the country.
My observation is that unit trust schemes have been a disaster for many, especially those who withdrew their savings from the EPF to invest.
In the light of this, it is important that the EPF and regulatory authorities review the existing guidelines for the withdrawal of EPF funds for the purpose of investing in unit trusts and other alternative forms of investments.
What is important is to ensure that investors are advised by qualified investment advisors with recognised qualifications and experience in the field.
This minimum standard of professionalism and due care must be set out clearly to prevent members of the public from losing their hard earned savings in the market place.
All unit trust sales agents and those who offer any form of investments for sale to the public must satisfy certain minimum requirements and they also need to be licenced by the appropriate authority.
It is suggested the Malaysian Securities Exchange Berhad and the Malaysian Institute of Banks conduct their own postgraduate diplomas in wealth management to provide investment advisors with the desired level of knowledge and skill.
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