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Hi everyone, I was out of action the last couple of days because I had visitors in town and have been socializing more than what I’m normally accustomed to…age must be catching up. 😉 Checked out the new-ish restaurant/bar sevenatenine at the Ascott Residences, along Jalan Pinang and really love the interiors. Food was a bit pricey though, but they have happy hours before 9pm so can’t really complain. Anyway am back in the thick of things again…

Last Friday night, whilst traipsing around town I ended up at a trendy bar in the Ceylon Hill area with my bunch. We bumped into an American friend (let’s call him Lance in case he wants to remain anonymous) whom I hadn’t seen in quite a while. Usually, Lance’s a pretty reserved and quiet kinda fella. But when I saw him at the bar he had several cosmpolitan cocktails lined up in front of him, and was happily slurping away at them. It turned out the bar was having a 1 for 1 promotion till 11 pm, and Lance was making the most of it. With 5 minutes to go to 11, I ordered a couple and we got chatting.
Did I mention that one of the reasons I was out painting the town red was to celebrate the growing number of people reading this blog? Well it was –  thanks to all of you guys out there for fueling my passion for this topic. I thought for one night, I could get away from the financial stuff…but I was wrong!

Lance found out about my blog and my recent foray into the financial planning field, and it was as if I’d pressed a magic button. It turns out his Dad is a retired financial planner, and apparently a very successful mutual funds sales agent. Lance got all animated as he waxed lyrical about how superbly some of these funds from the US had performed over the years and also how consistent they were – one fund has been giving returns of at least 10% per annum since before the Great Depression in the 1930’s. That’s at least 80 years of consistency!

Another fund is the retirement or pension fund for the US congressmen, which the general public was allowed to invest in. Lance referred to it proudly as “MY president’s pension fund”.

He must have heard his super salesdad’s sales pitch about a million times at the dinner table every evening. But Lance’s own investments have done very well for him, which is probably why he’s such a believer.

One VERY interesting bit of information that Lance shared with me whilst still in his happy state was that non-US citizens, including we Malaysians, have an even better alternative in that these days we can buy a successful US mutual fund’s offshore “clone“. These clone funds mirror their onshore cousins i.e. they’re managed by the same fund managers and hold the same portfolio. The only difference is that they are based out of tax haven countries, and so avoid US taxes.

This means 1. higher returns for us investors, and 2. since foreign income is exempted from tax in Malaysia, we don’t get taxed on the distributions either. Sounds great to me, dunnit?

Who sells them? And how to get? I’m not sure – this is where my homework begins. If anyone has any leads, please share your comments and I will check it out.

Meanwhile, it’s really reinforced my own faith in mutual funds hearing someone talk so passionately about such a long history of mutual funds in America. Sure, there will be ups and downs (like the recent EPF episode in Malaysia) but this is an investment which allows most people to invest their money quickly and easily (no need to be financially savvy or learn fundamental analysis, read charts), it’s liquid (you can cash out whenever unlike property) and you don’t need a lot of money to become a unit-holder of a diversified portfolio of blue-chip stocks (only RM500 gets you in for some funds in Malaysia). And now, the world is our oyster too it seems 🙂 Cheers!

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