The Investing Advice For Now

The markets are so listless that there is really not much to write about. Times like these, you actually want it to go down a lot faster and quicker rather than the slow Chinese water torture, which nothing happens but gloomy days all the time. In addition its not much point to look at stocks as undervalued stocks are aplenty. Just pick any of the top 30 big caps.

However if our time horizon is 2 weeks, who can ask investors to go and buy? Even if your time horizon is 1 month, its a hard call. But if your time horizon is 1-2 years, you can buy safely ... but then you are talking of lots of serious money to be able to do that.

The best advice I can give now is go and seek out your unit trust salesperson. Use your EPF money to invest. You are looking at 5% return a year with EPF. I am pretty sure you will see average return a lot more than that if you were to buy now and hold for a couple of years. How about 30% over 2 years, or sell the unit trusts when index goes back to 1,350. Surely that's a good bet. Its not even a bet, its a wise investing decision.

Sure, what if it hits 900, so what... using EPF funds, you cannot park all funds in one go. You can only invest 20% of Account 1 that is above RM50,000 each time. You can only do it once every 3 months. Hence if you start now, you will get some decent average cost investing.

e.g. If you have RM200,000 in Account 1. That means you can put 20% of RM150,000 = RM30,000 into an approved fund. Three months later, assuming you have RM175,000 in Account 1, you can put another 20% x (RM175,000-RM50,000) = RM25,000... and so on.

Pick the right company. Stick with Public Mutual or HLG Unit Trust. In my view their portfolio exposure for the various funds looks fine. You can pick from a few funds from each of the company. Ask to look at their fact sheet where you can see the historical price movements - its important that they at least track or outperform the respective benchmarks slightly. It could be the KLCI Index fund, or the growth funds, sector funds, etc. Then have a look at their top 10 holdings where you can assess better if these are the companies you want in your portfolio.

p/s photos: Goto Maki (sounds like a delicious handroll)