The conclusions that can be drawn from the comparisons done are as follows:

  1. In the equity/balanced funds category, the best performing mutual and investment-linked funds in Malaysia achieved average annual returns of at least 20% over the last 5 year period
  2. In the bond/money market category, the top mutual funds achieved an average annual return of at least 11% over the last 3 years
  3. The best capital guaranteed funds achieved an average annual return of approximately 4 % and above over the last 3 years
  4. There is much hoo-hah about capital guaranteed funds being in demand and popular because the capital is guaranteed. However it seems to me that from the relatively low returns in the past, and the fact that there are charges and usually a lock-in period (usually 3 years), one would be better off just leaving one’s funds in a fixed deposit account, especially with interest rates on the rise (approx. 4% for 12 months).

Other notes:

The investment-linked (IL) funds’ info is contained in a separate table in Personal Money (supplied by Normandy Perkasa). There is no ranking information provided on the returns consistency and capital preservation of these IL funds, unlike their unit trust counterparts. So, I can only make my conclusion on their returns consistency based on whether return these funds appear in my “best of” list for all my categories i.e. 1-year, 3-year and 5-years.

As far as I know, currently sales charges and annual management charges for IL funds are similar to those for UT’s i.e. 5-7% and 1.5% respectively for equity/balanced funds and 0.25-2% and 0.75% for bond/money market funds. Index funds are a particularly good way to get exposure to equities without paying an arm and a leg in upfront sales charges (approx 1-2%), although some like OSK-UOB’s KLCI tracker fund may lump you with another charge upon exit (1% repurchase charge). One peculiar exception is Public Mutual’s Index fund whose initial charge of 6.5% is no different from its other funds, hence not very attractive if an index fund is your cup of tea. But I note from Public Mutual’s website that the objective of this fund is to outperform the KLCI, which suggests more active management than what you would expect from typical index funds. So, the fund’s name is a bit misleading.

Last but not least, the above posts on mutual funds in Malaysia are for information only, and are not meant to be a recommendation for you to buy or sell any of the funds mentioned. Past performance is not an indicator of future returns so it’s always best to seek professional advice based on your individual circumstances before you invest.

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