MAYBAN Management Bhd is looking towards offering a wide range of innovative as well as different types of unit trust products in a bid to be competitive and gain a stronger foothold in the mutual fund industry in the country.
Although this move may sound familiar among some of the other players, Mayban Management is adamant that this would give it an added advantage not only in enhancing its business but also in providing wider options of funds to the investing public.
Its chief executive officer Ismail Mohd Yusof said most of the other players tended to roll out almost the same type of funds every year.
Our funds are all different in nature and suit the risk appetites of different investors. Currently, the bulk of the funds in the market are equity-based and many of them are similar in nature, hence further saturating the market with the same type of products.
There are more than 100 unit trust funds in Malaysia with total net asset value of RM51bil. This goes to show that people are willing to invest in these funds. By providing different funds, not only will it suit the different risk profiles of investors but at the same time also offer more options to investors.
We plan to have 16 funds by end-2005. Currently the company has eight different funds, namely the Mayban Unit, Mayban Balanced, Mayban Income, Mayban Dana Yakin, Mayban Index, Mayban Dana Ikhlas, Mayban Ethical and Mayban Value Trust Funds,'' he said during an interview.
The size for its eight funds currently stands at RM1.4bil and this makes Mayban Management one of the top five unit trust management companies in the country in terms of the total funds under management.
The company will be introducing two more new funds by the middle of this year: a capital guaranteed fund and an enhanced bond fund. It plans to introduce the former in a series over a period of time.
The capital guaranteed fund would ensure investors that their principal amount of investment will be preserved and with the possibility of securing returns higher than fixed deposits.
Mayban Management recently became the first unit trust company to launch a socially responsible fund in Malaysia.
With the launch, it also simultaneously introduced the Mayban Value Trust Fund.
Ismail said the introduction of the two new funds was in line with the government's efforts to improve and raise the level of domestic savings and the development of the local capital market.
The Mayban Ethical Trust Fund is aimed at meeting the expectations of investors who wish to ensure that their investments are channelled towards activities that have a favourable and harmonious impact on humanity, the environment and social well-being.
Ismail said the company was confident the fund would bode well for investors, as there were many who held such altruistic and social values that would welcome the fund.
Touching on the ethical fund, he stressed: If an Islamic fund can be successful and go down well with investors, the company sees no reason an ethical and socially responsible fund could not. The fund is more flexible than an Islamic fund.
An Islamic fund not only refrains from investing in prohibited counters like liquor, gaming and tobacco but also finance, insurance and some services-based counters, whereas it is allowed for an ethical fund to invest in all other counters that comply with ethical principles except liquor, gaming and tobacco.
The recent tragic events of destruction to life and property caused by war and environmental degradation have contributed to the rise of social and ethical consciousness in our lives. Investors driven by such consciousness would want to know how their monies are invested and ensure that the returns are not derived from activities that contradict their personal beliefs and principles.
Statistics has indicated that nearly US$1 out of every US$8 in the US under professional fund management incorporates some form of social screening in the investment process.
Meanwhile, the value trust fund invests mainly in securities that are trading at a discount to their intrinsic values.
Many of these stocks are value stocks with good fundamentals but which have been undervalued by the current weak market, he explained.
Adopting a longer term investment strategy and a good stock selection, Ismail said, would enable one to profit from value investing.
On the outlook of the stock market for this year, he said the imminent US-Iraq war would only have a short-term effect on the market as the KLSE had already factored in the possibility of the war breaking out.
To this end, the downside of the KLSE Composite Index would be small compared to its upside potential.
Ismail said there was also sufficient liquidity and idle cash in the banking system that had yet to be used for investment purposes.
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