THE Securities Commission has emphasised to financial planners the importance of adhering to professional and ethical standards in order to enhance the financial planning profession.
“Ethics is at the core of every healthy industry. Good governance practice at the financial and capital market intermediaries level (such as fund managers, stockbrokers, investment advisors) will result in a positive ripple effect and flow into their investee companies even if they merely hold minority stakes,” said SC chairman Datuk Ali Abdul Kadir at The Star/Standard & Poor's Investment Funds Award Malaysia 2003 presentation ceremony in Kuala Lumpur yesterday.
Ali said the Investment Funds Award would positively contribute towards good governance practices and higher professional standards within the investment fraternity. “It can also serve the function of promoting public awareness with regards to investment funds.”
He said although there was positive growth in the industry, there was room for further improvement and development. He believes it can be brought about by greater awareness and understanding of the concept of wealth management or financial planning.
The total net asset value of unit trust funds under management had increased from RM47.3bil as at end-2001 to RM53.7bil at end-2002.
In his speech, Star Publications (M) Bhd managing director Datuk Steven Tan said the Investment Funds Award was timely, as given the tumultuous events in Asia and the world in recent years and the Iraq war, investors particularly retail ones were confused and afraid as to where to invest.
He said that with traditional avenues of investment like bank deposits, the property and stock markets returning historically low yields, if not losses, it was critical for Malaysian investors to seek professional financial advice to ensure good and safe returns.
Tan said there were 39 management companies, with 188 approved funds and 135 billion approved units, of which 86 billion units were already in circulation under 10 million accounts as at Jan 31 and the numbers were expected to grow even more in the coming years.
He added that investors’ need for an objective evaluation methodology was critical in the expanding Malaysian fund market. “The Star/Standard & Poor’s Investment Funds Award will hopefully assist the retail investor community in establishing a standard for analysing fund performance,” Tan said.
Standard & Poor’s Investment Services Asia Pacific managing director William Reidy said the Investment Funds Award represents a fantastic opportunity for educational purposes.
“We believe in highlighting issues like market performance and conveying that message to both individual investors and institutional investors as a way to increase professionalism and transparency that is overall positive to the financial markets,” he said.
Reidy said the company believed that wealth management and the mutual funds industry were critical sections within the financial sector and were very important not only in Malaysia but on a regional basis.
“There are still good investments out there despite what has happened in the equity market and geopolitical situation,” he added.
Reidy said the winners were all true performers that had demonstrated a very high level of professionalism and expertise in such fluctuating market conditions.
Eleven fund groups bagged the 16 awards allocated for this year’s inaugural The Star/Standard & Poor’s Investment Funds Award Malaysia 2003.
The methodology deployed is the Relative Risk-Adjusted Ratio, a calculation that evaluates the performance of a fund and the consistency of that performance relative to other funds in its peer group sector.
It awards true consistency and effectively eliminates the risk of awarding funds that had performed in an erratic out-of-sector way.
Of the 180-odd funds registered for sale in Malaysia, only sectors containing four or more funds with sufficient history (one-year, three-year, five-year and 10-year) were considered. Only 136 funds from six sectors qualified to be evaluated.
And the winners are...
WINNERS of The Star/Standard & Poor's Investment Funds Award Malaysia 2003: (Seated, from left) Richard Chua (TA Unit Trust Management Bhd), Datuk Seri Goh Eng Toon (BHLB Pacific Trust Management Bhd), Datuk Nik Mohamed Nik Yahya (OSK-UOB Unit Trust Management Bhd), Datuk Steven Tan, managing director, Star Publications (M) Bhd, Datuk Ali Abdul Kadir, chairman, Securities Commission, William Reidy, managing director, Standard & Poor's Investment Services Asia Pacific, KLSE deputy president Abdul Hamid Sh Mohamed, Datuk Taha Ariffin (CMS Trust Management Bhd).
(Standing, from left) Kenny Tan (Alliance Unit Trust Management Bhd), Lee Seng Young (OSK-UOB Unit Trust Management Bhd), Ho Seng Yee (OSK-UOB Unit Trust Management Bhd), Edmond Cheah (Public Mutual Bhd), Lynn Cheah (Prudential Unit Trusts Bhd), Michael Auyeung (Pacific Mutual Fund Bhd), Yoon Mun Thim (Amanah SSCM Asset Management), Ivan Tham (HLG Asset Management Sdn Bhd), Teng Chee Wai (Hwang-DBS Unit Trust Bhd).
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