EPF pares down list of unit trust funds offered under MIS

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KUALA LUMPUR: The Employees Provident Fund (EPF) has slashed the number of unit trust funds that qualify under its Members Investment Scheme (MIS) by 44 to 269.

EPF said in a statement that it had raised the minimum eligibility score of Simple Average Rating for Consistent Returns (SACR) to 2.33 from 2.00 to provide further protection for investors by screening out the bottom performers.

The list of unit trust funds offered under the EPF MIS is evaluated annually based on the criteria established by the EPF and approved by the Finance Ministry. Any fund which falls below the minimum requirement will be suspended and will not be offered during the period.

The offering period for the 269 unit trusts from 22 fund management institutions (FMIs) is from March 1, 2017, to Feb 28, 2018.

The EPF has reduced the number of equity funds from 175 to 146, mixed assets funds from 66 to 56 and bond funds from 41 to 36, while the money market and property trust categories are kept unchanged at 30 and one, respectively.

EPF deputy chief executive officer (investment) Datuk Mohamad Nasir Ab Latif said when SACR was first introduced in 2010, the industry had been notified that the minimum eligibility score would be raised gradually to enhance and ensure the quality of funds offered under the scheme.

“We had raised the minimum eligibility score to 2.00 from 1.67 in 2013, and it is now timely to raise it to 2.33,” he said in a statement on Tuesday.

“The latest revised list also sees members having more variety of funds for their investment diversification following the removal of the 30% foreign exposures cap in August 2016. Members may now tap into funds with higher potential growth and opportunities present in foreign markets.”

The EPF MIS allows members to transfer part of their savings from Account 1 for investments through the appointed FMIs as an option to enhance their retirement savings.

Effective from Jan 1, 2017, the amount for transfer had been revised upward to not more than 30% (from not more than 20% previously) every three months from the savings in excess of the basic savings amount in Account 1.

The basic savings is a pre-determined amount set according to age in Account 1 to ensure members have at least RM228,000 upon reaching age 55 (prior to Jan 1, it was RM196,800). 

The basic savings quantum was benchmarked against the minimum pension of RM950 per month for 20 years from 55 to 75 years old.

The EPF provides a fund information portal which can be accessed for free via i-Akaun. This portal allows members to obtain information on unit trust funds offered under the scheme as well as FMIs managing these unit trust funds.
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