Saturday, July 21, 2012

How to calculate EPF investment withdrawal amount?

Although EPF members investment scheme was launched years ago, yet many Malaysians still do not know the existence of it. Follow by next question: "How to calculate the withdrawal amount?". Hope this post can give all of you an insight on this matter.


First, we must know that EPF members investment scheme only allows eligible members to withdraw eligible amount to EPF-approved investment schemes. The schemes was being monitor closely by EPF authorities, by reviewing it every year, in order to protect the interest of EPF members.

Am I eligible?
Members can withdraw up to 20% of access amount from the minimum required Basic Saving in Account ONE. The minimum amount for each withdrawal is RM1,000. Sounds confusing, right? Let's explore it step-by-step.


Step 1:
Determine the age (what is your celebrated last birthday?)

Step 2:
Determine the required Basic Saving in Account 1.


Step 3:
Determine your Current Saving in Account 1.

Step 4:
Applying the formula : (Account 1 - Basic Saving) x 20%
Example of Calculation
Still find it difficult to understand?
Easy. Just register for an EPF i-Akaun (an online EPF account), click on the "Withdrawal" button, then you can view the eligible withdrawal amount for various purposes. It's just that simple and accurate, without calculator. What's more? You can view the withdrawal status and history too.




Related Post: EPF i-Akaun (Series 1)
Source: EPF website

Wednesday, July 11, 2012

Arthneeti, June 2012 Issue




Dear Readers,     
                                                                                           
We have witnessed a slew of depressing data about
Indian economy in the last three months. Pick any
macroeconomic data and you are bound to get a
negative feeling about economy and uncertain
future. Fitch and S&P revised India’s credit rating
outlook to negative from stable whereas Moody’s
reaffirmed credit rating outlook to stable.Future 
looks quite uncertain and direction will depend upon
supporting policies by political class.

To read further, click here

Monday, July 9, 2012

Maybank Silver Investment Account

After the successful launching of Gold Investment account, Maybank had come out with another innovative option for mass market --- Silver Investment Account. This would be part of its portfolio of precious materials being offered to consumers. Yes, Maybank was the 1st bank in Malaysia to offer a silver investment passbook account, allowing deposits and withdrawals in silver at a daily price in ringgit at any of its branches nationwide.


How about the return? Of course, it all depend on the silver price fluctuations. For ease of recording and maintenance, all the transactions would be recorded in the customer's passbook. It's simple, transparent and affordable.

More about "Silver Investment Account"

Who can apply?
  • Individuals aged 18 years and above
  • Joint account - maximum 4 persons

Key Features of Maybank Silver Investment Account:

Benefits:
  • A great way to increase the degree of portfolio diversification
  • A better security against inflating economies
  • It is convenient to manage your investment with your passbook
  • Start right away with an affordable initial purchase

Why affordable?
Let's take the silver selling price of RM2.93 per gram (as at 9th July 2012) multiply with minimum 20 grams, it only cost you RM58.60 to kick-start your silver investment portfolio. Please add-in one off RM10 stamp duty to open the account.

Finance Malaysia Blog thinks that this is a very innovative products being offered to investors to diversify their investment portfolio to include silver as another asset class. This type of account brings us the ease of investment, forget about the hassle of trading silver. Happy investing!!!

Source: Maybank website



Friday, July 6, 2012

What is INTEREST SCHEME?

There are numerous interest scheme being offered to public to participate for the past few years. It heats up when investors are looking to various instruments to grow their money after the 2008 global financial crisis. But, before we participate in those scheme, are we really fully understand what is Interest Scheme?


Interest Scheme is a way of doing business in Malaysia. Interest Scheme involves the pooling of financial contribution from the public in exchange for an interest in a particular scheme. Such interest includes the usage of the facilities and services provided under the scheme or profit or returns, depending on the nature of the scheme.

Rules and Regulations
Promoter of an interest scheme must register the scheme with SSM before it can be offered to the public. The sale of interest is governed by the provision of Division 5 of Part IV of the Companies Act. The promoter of an interest scheme is also required to comply with the Policy Guidelines and Requirements issued by SSM from time to time.

'Interest' is defined under section 84 of the Companies Act as:
A right to participate or interest in any:
  • profits, assets or realization of a business;
  • common enterprise with expectation of profits, rent or interest;
  • time sharing scheme; and
  • investment contract.
How to identify an Interest Scheme?
  • You will be required to make payment to participate in the scheme
  • You are not a shareholder of the company
  • You are not involved in the day-to-day management of the scheme
  • You have interest in the business or the scheme offered
AND any one of the following criteria:
  • You have interest in the profit, asset and realization of a business or a scheme in Malaysia or elsewhere
  • You are promised that you will procure returns from the payment you made
  • You acquire the rights/interest in a property which includes the right to use the facilities on the property for a period of more than 12 months
  • You have the right to occupy any property for 2 or more times during the tenure of the time-sharing scheme

There are various types of Interest Scheme which offers:
  1. membership subscriptions of more than 12 months by Gold Clubs, Recreational Clubs and Fitness Clubs
  2. participate in time-sharing scheme
  3. invest in plantation and aquaculture scheme for commercial purposes (etc. Sharefarming)
  4. invest in Breeding of Livestock for commercial purposes (etc. swiftlets, catfish)
  5. invest in business whereby the investors are not involved in day-to-day management
  6. purchase burial plots, urns and columbaria by Memorial Park
  7. purchase undivided interest in greebelt land where by purchasers are let to expect profit from the sale of the appreciated value of the land (Land Banking Scheme)

Source: Suruhanjaya Syarikat Malaysia (SSM)

Thursday, July 5, 2012

Watchdog Capital: Setting a hedge fund bloodhound on the trail of financial crime


DIAMOND: SHOWING SOME CRACK
The ease with which the Libor scandal has brought down the towering figure of Bob Diamond, master of the universe and investment banker extraordinaire, is truly momentous. It reveals how small cracks in corporate structures can turn into gaping chasms that engulf whole management teams. For those that haven’t been following the scandal, the gist of it is that traders have been caught submitting inaccurate figures to manipulate the Libor rate – an index which tries to reflect the average rate that banks can borrow on the 'interbank market' (aka. from each other) – for various dubious schemes.

Libor relies on banks submitting honest figures to the British Bankers Association (BBA), the organisation that calculates the index. Interestingly enough, I was at a debate a few weeks ago on the topic of financial sector corruption, which pitted investigative journalists Ian Fraserand Nick Kochan against a representative of the British Bankers Association. Kochan and Fraser argued that London was a hotbed for corruption and dirty money. The BBA representative didn't agree, arguing that greed and corruption ends in the City, rather than starting in it. Needless to say, the conversation probably would have been somewhat awkward for him if it had been scheduled for this week instead.

Ian Fraser’s analysis at the debate was hard-hitting. He argued that the concept of genuine stewardship in finance had completely broken down, with people entering it as a glorified get-rich-quick scheme. He argued that big intermediaries (banks) are riddled with conflicts of interest, that they often act at the expense of their clients, and that the ‘Big Four’ accountants are complicit in this process. The regulators are under pressure to prioritise City competitiveness over public interest, and prefer to make scapegoats out of juniors than target senior executives. Even financial journalists are ambivalent about exposing scandals, in fear of losing favour in the courts of precious financial information. Fraser labeled it a ‘dictatorship of finance’, and suggested an independent enquiry was needed in order to regain trust.

Time for a true activist hedge fund
In the wake of the Libor scandal it appears the government might indeed hold some type of enquiry, but I’m skeptical of how deep it will go. If regulators, auditors and even journalists have limited will to uncover fraud, perhaps we need some new approaches. I noticed the other day that Barclay’s share price plummeted over 15% on the news of the Libor scandal. That’s a pretty big drop. If someone had shorted (bet against) Barclays shares, they would have done well. It’s naturally occurred to me then, that perhaps one solution is to set up a hedge fund, trained to sniff out financial fraud, expose it, profit from the resultant scandal, and then steer the money back into further financial activism.

The Investment thesis Part 1: The public scandals are just the tip of the iceberg
The Libor scandal offers fresh insights into financial skulduggery, but it’s always hard to tell whether these instances of financial crime, market manipulation and corruption are once-off anomalies or endemic, widespread problems. For one thing, financial crime is often incredibly difficult to detect, and very hard to prove. The occasional scandals tend to be the most sensational cases, but most corruption probably isn’t overt and outrageous. It could be subtle and even subconscious. Earlier this week The Telegraph published the statement of an insider who claims to have known about the Libor rigging. It echoes some of the points I made in a previous post about the problems whistleblowers face: In an environment where dubious behaviour gets normalised by an overall culture of acquiescence, it’s easy to go along with it. Collective inaction can be as strong a form of corruption as the individual actions they quietly ignore.

THAT AIN'T AN ICEBERG, THAT'S MOBY DICK
I personally tend to think that the cases of corruption we see are just the tip of the iceberg. My basic theory comes partly from an academic paper I wrote back in 2007, entitled Free market crimogenesis, corporate governance and international development. In it, I suggested that free market systems tend to encourage short-termism, and that encouraged structures and value sets which are ‘criminogenic’, a fancy way of saying ‘crime-promoting’ or ‘crime-facilitating’.

The first part of my argument is that there are criminogenic structures within financial organisations. I’m not in the camp that says that rampant greed is the only underlying value in finance, and I strongly believe that people within the sector are motivated by a wide range of factors (as will be discussed in a later post). I would argue though, that financial professionals are often working within structures which can amplify those parts of human behaviour we call ‘greed’. Bonuses are often cited for the damaging incentive effects they can have, promoting ‘get-rich-quick’ expectations, but there are many structures within finance that have criminogenic potential. For example, take job promotion systems in which upward mobility is based on the ability to hit short-term targets. This, over time at least, could (statistically) favour those who are prepared to be 'morally flexible', those who are most prepared (and skilled enough) to bend the rules to meet targets, and those who are prepared to cover up misdemeanors of juniors under them. If middle and higher management gets populated by individuals who view such ‘flexible’ and ‘creative’ behaviour as comparatively normal, the implications for corporate culture lower down the ranks are severe.

The second part of the argument though, is that there is a lack of policing mechanisms to counteract or de-emphasise the short-term greed-enhancing factors in the system. Many systems in the world have crimogenic potential, but that is often dampened and contained through formal policing (e.g. official regulation and legal systems), and informal policing via systems of social disapproval and shunningfor bad behaviour. Both of these appear to be somewhat deficient in the financial sector though. Regulators appear muzzled by a serious lack of political will to prosecute financial crime, which means fear of prosecution is limited. As for informal policing, many argue that the culture of finance actively encourages dubious ‘Gordon Gekko’ style behavior. Even if you (like myself) disagree with that stereotype, it’s hard to argue that the internal culture of banks would excel at preventing bad behaviour.

Investment thesis 2: The rest of the iceberg can be successfully uncovered, and exploited
I strongly suspect there is a treasure trove of financial frauds waiting to be discovered. Sniffing out when and where they will be exposed, quickening that process, and then betting on the downfall of exposed companies could be a great investment philosophy, not to mention societally useful. The term ‘activist hedge fund’ is used to describe any fund that challenges company management, but this would be a truly activist hedge fund, steering the profits made in exposing negative behaviour back into financial campaigns.

WELCOME TO OUR SUBTERRANEAN ICEBERG OFFICES

It wouldn’t be easy though. We’d need a unique combination of skills, a motley crack team of radical crime-fighters. For example, we’d have to hire:
  • Ex-FSA & SEC employees, skilled at the ins and outs of regulation and the loopholes 
  • Ex-traders (and especially rogue traders), skilled at understanding the operations of various financial professionals
  • Criminologists, with deep understanding of criminal structures and how they work
  • Ex-bank IT staff and back office staff, who know the nuances of bank IT systems
  • Activists/Campaigners, passionate about mobilising networks of people and raising awareness
  • Hackers, for occasional… um… unorthodox information retrieval.
  • Ex-FBI agents and Mi6 operatives with advanced analysis and infiltration skills
  • Forensic audit experts, and big data experts, to spot anomalies among numbers
  • DJs: To provide atmospheric background tracks in the office

Days will be spent doing elaborate research of bank structures and strategies. Nights will be spent trawling City bars in search of leads. We’ll have offices on the edge of the financial district (London & New York initially) with big screens mounted to the walls and satellite surveillance equipment. Of course, there will be beanbags in the office, and hammocks.

Now that I come to think of it, such a fund would have obvious crossover with my Financial Wikileaks concept – perhaps the professionals at the fund could be the ones processing leaks that get steered to the site…

Watchdog Capital: Bloodhound Fund No.1
FEED ME BABY
All the details can get straightened out later. Most importantly though, the hedge fund would need a punchy name. Any ideas? There are certain conventions to naming hedge funds and even a hedge-fund name generator. I’m thinking of Watchdog Capital, hunting down financial scandals since 2012. Our first fund could be called The Bloodhound Fund 1, and it will raise money from a variety of angel investors and charitable foundations. If you’re interested in joining the team, send your CVs.

Tuesday, July 3, 2012

RHBRI: Market Outlook & Strategy 2H2012


In our view, the equity market will likely be stuck in a range-bound trading pattern for now, but will likely trend up as global economic uncertainties clear out towards the later part of the year. Investors’ key worries include :


  1. worsening of the euro-debt crisis that remains unresolved
  2. fears of China’s and India’s economies crashing down into a hard landing; and
  3. the risk of US falling off the “fiscal cliff”.

External Volatility And Impending Election 2 Key Headwinds

On the home front, the major event to watch out for is the impending general election that could also create volatility to the local bourse given the uncertain election outcome. Nevertheless, we believe the market will eventually trend higher towards end-2012, premised on:
  1. the ECB making a more decisive move to mutualise the debts of Eurozone governments;
  2. China policymakers ease policies substantially and its economic growth re-accelerates;
  3. US Congressional leaders cobble together some deals to mitigate the impact from the “fiscal cliff” and allay the fear of its economy falling off the cliff; and
  4. domestically, the general election produces a result where the ruling coalition party remains in control of the government.

Meanwhile, global financial markets are still likely to be awash with liquidity as central banks in advance countries have pledged to maintain extremely loose monetary policy and could unveil more quantitative easing programmes to support economic growth should the situation warrant. 


On the home front, the economy is more resilient than feared and we expect real GDP growth to stage a modest rebound to 4.7% yoy in the 2H, from +4.4% estimated for the 1H. In the same vein, net EPS growth for the market is projected to recover to +10.8% in 2012 before moderating to +7.8% in 2013. Consequently, we are maintaining our end-2012 FBM KLCI target at 1,650 based on 14.6x 2013 earnings.





Given global macro headwinds and general eletion risks on the home front, we believe it pays for the more discerning investors to hold some defensive stocks that have strong cash flows to pay sustainable dividends in their portfolios. In addition, we believe investors would still need to accumulate fundamentally-robust stocks on weakness in order to outperform the market. Sector-wise, our key overweight are telecommunications, consumer and banking, although we also have an overweight stance on the utilities, gaming and semiconductor sectors.


Source: RHB Research Institute

Monday, July 2, 2012

Ett Investerartips så här Inför Sommaren – Risk Parity!



Om man får välja så är det är självklart bättre att erbjudas ett par gedigna principer att hänga upp sina investeringar på än att få något specifikt köpråd då och då. I denna anda tänkte jag idag dela med mig med en av de principer jag personligen följer. Den har faktiskt ett namn, ”Risk Parity”, och är ett alternativ till den gamla trotjänaren CAPM.
CAPM är ju en fantastisk teori och den har nu överlevt ett halvt sekel såväl i akademin som på marknaderna. Den har dock vissa problem och själv har jag faktiskt aldrig varit någon stor anhängare av denna ”investerarprincip”; d.v.s. att du ska diversifiera så mycket du kan och sedan blanda denna marknadsportfölj med pengar på banken i proportioner som passar dig. Och vill du sedan ta mer risk än vad marknadsportföljen bidrar med får du förlika dig till leverage.
En alternativ investerarprincip som jag delvis lutar mig mot i min egen förvaltning är att diversifiera i risk istället för att diversifiera i kronor. I stället för att köpa mycket av aktier som har hög market cap, och lite av dem med liten market cap (á la CAPM) så är tanken med Risk Parity att du ska köpa mycket i tillgångar med låg risk och lite i dem med hög risk. En lämplig portfölj kanske kan vara 30% bankkonto, 20% obligationer, 20% i fastigheter, 20% aktier och 10% guld och andra råvaror.

-----------------------

OK, vad är argumenten bakom detta? Varför i hela världen ska man diversifiera på just detta sätt? Varför ska man diversifiera i risk? Personligen har jag två starka argument: 1) i min värld känns det intuitivt mycket mer lämpligt än att följa t.ex. CAPM eller att följa ideosynkrata köp/sälj råd i media och 2) det utnyttjar det faktum att de flesta investerare, vare sig de är fysiska personer eller fondbolag, uppvisar det man kallar ”leverage aversion”.
Det första argumentet vill jag inte diskutera här på bloggen. Det andra argumentet vill jag kort diskutera. Leverage aversion bygger på att man "ogillar" att belåna sig. Personligen tror jag många känner så. Och även om man ej känner så, t.ex. om man är en fund manager som spelar med andras pengar, så kan det vara så att du inte får belåna dig (tänk mutual funds). Eller att det är kostsamt (tänk margin accounts, counterparty risk etc.). Denna leverage ”aversion” gör att de som vill ta mycket risk inte belånar sig utan istället överviktar sin portfölj med högriskaktier etc. och underviktar den med lågriskaktier. Detta handlar upp priserna på högrisktillgångar relativt lågrisktillgångar och gör de förstnämnda sämre investeringsobjekt för oss andra (lägre expected return). ==> köp mer av lågrisktillgångar och mindre av högrisktillgångar = Risk Parity!