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Showing posts from January, 2010

US and China updates Jan2010

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Investors are being carried away by a surprise Government’s Policies measures planned. Although the intention of US and China governments are good as the words goes-by, share markets could not stand it that way.

What was being implemented in China?
· Issuing government bonds with higher yield, this is to reduce the liquidity in the market, by encouraging money flowing back to the government’s war chest.
· Increasing the minimum down-payment for property purchases from 20% to 40%.
· Increased bank reserve requirement by 0.5% to 16% for big banks, and 14% for smaller banks.

What was being planned in US?
Obama’s bank plan composing two main elements:
1. Limitation of bank’s size.
2. Limitation of products and services offered, which is deem lucrative for banks.

As such, US and China market have corrected by 5.1% and 4.4% respectively. The percentage was no big deal, given the bull-run since March 2009. However, investors just can’t take it anymore, and this kind of policy changes gave them a very…

Unlocking the Mystery of Capital Protected Funds

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Recently, there are a few capital protected funds being matured. However, most of the investors are not satisfy with the performances as promised when the fund was launched years ago. Is this the fault of investors who don’t understand it? Or, the fault of the product itself?

To make things worse, most of the investors are conservative in nature – older age group. If your mum or dad was one of them, make sure you finish this and explain to them.

Although Capital Protected Funds have been exist in Malaysia since early 20s, many investors still unclear about the structure of this type of fund. Is it safe as the name goes by? What is the return like? And, are there any terms and condition apply to it? Questions usually asked were answered below:

What are capital-protected unit trust funds?
· They are investments that promised to repay 100% of your capital, when held until maturity, which means your downside risk is protected.
· They do not guarantee returns to investors, but only promise to p…

2010 Economic Forecast

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After some spectacular performances displayed by global equity markets, how is 2010 heading? In fact, 2009 is a year, in which, share market around the world performed the best in recent years. Indonesia is leading all the way with an awesome 87% gains, follow by China, India, Brazil, Hong Kong, Singapore, and Taiwan…

Meanwhile, Malaysia too joining the bandwagon by rising 45%, which was the index’s biggest annual gain since 1993. All of this was started since March 2009 when risks appetite increased and low interest rate environment surfaced.

Is this Sustainable?
However, all of this was fueled by excessive liquidity, couple with low interest rate, with oversold position of global markets only. The next engine would be earnings growth from companies, where this is the real food for the “Bull”. Because low interest environment forced people to invest, and a lot of people borrow USD to invest globally, which gave them handsome profit.

So, what’s the prediction of 2010?
As long as US do not …