Why Unit Trust?

[kwlim393]

Hi, I have less experience in unit trusts. I would like to hear more about unit trust investment.

Please provide some guideline on below topics: -
- Which fund is best?
- Performance comparison chart?
- Any online trading platform? Lazy to fill in form  
- Service charge rate and comparison?
- EPF withdraw calculation?
- Rate of Return?
- Unit trusts investment strategies?
- Etc.

Tell me more if you know anything about unit trusts.  :oops:

[Guest]

Buy AXREIT. Is a property trust fund. Good dividend yield and very low fee since your remisier is only charge 0.6% instead of unit trust agent 5%

[haz]

Hii O:)

-Performance of unit trust - check the Lipper/Moningstar/Normandy Unit trust performance table in any issue of The Edge.
-Which fund is the best? depends on your objective eg. time horizon , volatility tolerance etc. Some fund give good performance within 1 year, some are not in say 5 years. check the table.  
- rate of return varies. use Index, FD or EPF rate as the benchmark.

BTW, AXREIT is a close-ended fund. If you invest in this counter, the capital appreciation will depend a lot on supply & demand. While for other typical open ended unit trust, its nothing to do with supply & demand; depend on the portfolio of stocks' s performance of the fund. It 's not under approved fund under EPF Investment and shouldn't be.

[ong_poh_hock]

What is the diffrence between the two funds?

[bizfun]

Okay, here is the summary for your understanding.

There is similarity, both types of funds pool the assets of numerous investors into a single portfolio. Regulations require that, in both types of funds, dividends and capital gains be distributed yearly.

The Different
Open-end funds are bought and sold directly from the mutual fund company. There is no limit to the number of available shares because the fund company can continue to create new shares, as needed, to meet investor demand. On the reverse side, the entire portfolio may be affected if a significant amount of shares is redeemed quickly and the manager needs to make trades to meet the demands for cash created by the redemption. Costs associated with this trading activity are shared by all investors in the fund, so the investors who remain in the fund share the financial burden created by the trading activity of investors who are redeeming their shares.

Closed-end funds are launched via an initial public offering (IPO) that issues a fixed number of shares. The Securities & Exchange Commission regulates closed-end funds and mandates that IPO investors receive a prospectus, which contains the appropriate disclosure information. The fund manager takes charge of the assets gathered during the IPO and invests them according to the fund's mandate. The shares are then bought and sold on the open market, so investor activity has no impact on the manager's decisions. This trading distinction can be an advantage for money managers specializing in small-cap stocks, emerging markets, high-yield bonds and other less liquid securities. On the cost side of the equation, each investor pays a commission to cover the cost of personal trading activity (that is, the buying and selling of the fund in the open market).