Unit Trust industry is nothing new to the most of working people in Malaysia. Today Malaysia has around 32.73 million of peoples in its population. However only 20.5 millions accounts were registered into Unit Trust with respective Unit Trust Management Company in Malaysia. This figure represent 62.6% of participation rates.
Why should I invest now?
Well, today serve as a good opportunity to start your investment into Unit Trust due to 3 factors:
- Low service charges
- Bear stock market
Low sales charges, 50% discount!
Prior to 2020, Unit Trust Management Company or simply known as UTMC used to charge up to 3.0% for every investment an investor made by using an EPF account 1.
Nowadays, this sales charges has been lowered down from 3% to 1.5% since 1st of May 2020 until 30th of April 2021. Low sales charges fee will take place for 1 year period. This lowered sales charges represent 50% discount!
Lowered sales charges will allow investor to diversify their retirement portfolio at a lower cost. While at the same time will optimise returns for their retirement fund.
This steps was taken by the EPF to encourage investment by the public into Malaysian economy. By having lots of investment into the market for instance a company, this directly will spur on new project and employment opportunity. Its a win-win situation for investors as well as companies.
Bear stock market
The timing is a good opportunity as the current market downtrend offers significant opportunities to invest in undervalued funds. Since COVID-19 pandemic started, lots of stock market facing a bear market.
What is bear market? The term on Wall Street is synonymous with serious, long-lasting declines in stock markets. In numeric terms, a bear market is a 20 percent or more drop from a recent peak.
For instance in the US market, Dow Jones Index already experienced 56% dropped in value on 20th March 2020. It does not happen on daily basis. According to expert in financial market, this is bargain of a lifetime in a 33 years!
However, as of today, there a lot of stock market who is still facing the downturn. For instance KLCI. Since new government took over the Putrajaya, KLCI was steadily losing its value due to its small capital market and foreign investor sensitivity to the new government.
You can start your investment by using EPF account 1 through e-MIS. This is an online system investment that you can make using EPF apps downloaded into your respective handphone. This scheme require an investor to get the fully equipped with financial market risk and return. EPF also advising its member a to do proper research and analysis of funds.
Fortunately, if you are still interested to invest into a Unit Trust but do not know where and how to start you can always get an informed decision by engaging a Unit Trust Consultant.
With a Unit Trust Consultant in your life, he may be your financial advisor. You can ask him about almost everything with regards to your retirement planning. Isn’t it a wise decision to do all the items above and getting a ‘free’ Consultant? Its like buying 2 items then it comes with 1 item for free!
New strategy by public institution
With that being said on the above, Permodalan Nasional Berhad and Tabung Haji also are taking proactive measures by strategising their investment into overseas market. This was planned in order to maximise return for its depositors during undervalued stock market environemnt
Whereas for TH, they plan to grab undervalued equity stocks up to 25% from its total investment.