Wednesday, June 6, 2012

What is Ringgit Cost Averaging?

Hari nie aku nak share info tentang RCA atau Ringgit Cost Averaging (kalo kat tempat omputih,dorang sebut sebagai DCA or Dollar Cost Averaging)..Info ni aku amik dari website sebuah syarikat pelaburan yang terdapat di malaysia..Just Copy and paste..haha..sebab kat situ,dia dah explain semua..So, selamat membaca..



Introduction:

“If I have noticed anything over these 60 years on Wall Street, it is that people do not succeed in forecasting what’s going to happen in the stock market.”
– Benjamin Graham, author of “The Intelligent Investor”

Investing would be so simple if only one could predict when is the best time to buy or sell. However, timing the market is impossible and many have made huge losses due to trying and consequently failing. One of the ways to ride out the ups and downs of the constant volatility of the stock market is to use ringgit cost averaging. This method ensures we benefit from the historical strong returns shown in the long run and hedges the effects of retracement and slight downtrend in the short term.



Ringgit cost averaging is an investment technique intended to reduce exposure to risk associated with making a single large purchase by investing a fixed amount on a particular investment (such as unit trusts) at regular intervals (either monthly or quarterly), regardless of the unit price. For example, you can choose to transfer RM500 to RM1,000 from your paycheck to a unit trust fund or you can even make a RM1,500 or RM3,000 investment every quarter. The amount and frequency of your investments depend on your financial means and future goals.





How Dollar Cost Averaging Works
“Save little save often – dollar (ringgit) cost averaging works, if you stick to it.”
– Paul Clitheroe, “Ten Key Steps to Wealth”, 2002.

To illustrate dollar cost averaging better, let’s say you want to save RM12,000 each year for your child’s education fund. Instead of investing it in a lump sum and bear the risk of entering when the market is high, you decided to invest RM1,000 into a unit trust fund each month as shown in the chart:



Results
Average Cost Per Unit RM0.1923
Unit Price as at December RM0.2510
Value of Investment as at December RM15,664.48
In this example, by using the method of ringgit cost averaging, the average cost per unit invested was only RM0.1923, instead of RM0.2549 if the investor has invested a lump sum in January.


A Long-term Investment Strategy
“Discipline is the key to success for the long-term investor. He or she must not fall into the trap of managing holdings by newspaper headlines, sound bites, mindless predictions, gut feelings or the last time period results.”
– Frank Armstrong, author of “The Informed Investor.”

Regardless of the amount of money invested, dollar cost averaging is a long-term strategy. While the financial markets tend to fluctuate, they often move in the same direction over fairly long periods of time. Bear markets and bull markets can last for months, and sometimes even years. Because of these trends, dollar cost averaging may not be as effective if only applied for the short-term.

For example, an investor might choose to make 10 purchases of a unit trust fund within one month. Although it is highly unlikely that the purchase price of the units will be the same for each transaction over such a short time frame, there will not be a significant difference as well.

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However, over the course of a longer market cycle, you would probably go through a bull market and a bear market, with the price of a given security changing considerably. Dollar cost averaging will help ensure that your average cost per units represents both the premiums of a bull market and the discounts of a bear market, as opposed to just the premiums usually paid by investors in a bull market.


Tips to Get you Started
“Those who put an investment programme in place will have a lot more money
when they come to retire than those who never get around to it.”
- Australian financial author Noel Whittaker.

Many unit trust funds allow you to begin investing with a minimal amount with the option to make further contributions through regular deductions from your paycheck or bank account.If you’re interested in dollar cost averaging, here are a few tips to help you put this strategy to work for you:
  •  Get started as soon as possible. The longer you have to ride the ups and downs of the market, the more opportunity you have to build a sizable account over time.
  •  Stick with it. Dollar cost averaging is a long-term strategy. Make sure that you have the financial resources and discipline to invest continuously through all types of markets, regardless of price fluctuations.
  • Take advantage of automatic deductions. Having your investment contributions deducted from your paycheck or bank account is an easy and convenient method to invest, and can help you get into the habit of investing regularly.
  •  Be prepared for losses. Dollar cost averaging does not guarantee that there will always be profits and no losses in your portfolio. Even though you paid a lower average cost than the average price of the units, you could still lose money if you choose the wrong time to exit the market, particularly when prices are low.

Building wealth by investing in unit trusts is more a matter of patience and persistence than of investment skill and luck. The major decision that must be made is whether or not you are willing to forego immediate gratification to achieve your long-term financial goals. If you are, then dollar cost averaging can be a very effective way to help you get there.

So,aku harap article diatas dapat menambahkan knowledge korang pasal pelaburan atau bahasa omputihnya,investment..

Sunday, June 3, 2012

Register 2012,Dapat Tahun 2049



Last monday, 28 may 2012,aku pegi tabung haji..nak register untuk pegi haji..saja pegi register awal,boleh menyimpan bila kita dah taw tahun yang kita nak pegi tu..Kalo korang nak register,ada 2 cara...sama ada korang buka akaun dengan tabung haji (modal rm2 jew untuk buka akaun) dan ada simpanan tunai rm 1300 dalam akaun tu,dah boleh mendaftar..lagi satu cara,korang register ikut epf..dengan syarat,kena ada rm1300 dalam akaun 1 epf korang..then, print out latest epf statement tu,bawak pegi tabung haji..nanti diorang registerkan untuk korang..Cara tu yang aku buat masa pegi daftar haji haritu..haha








Masa no.giliran aku sampai,aku pegi la kat kaunter tu..yang jaga kaunter tu,pakcik yang berumur dalam 50-an la aku rasa..gelak besar dier bila tengok tahun yang aku dapat tu..tahun 2049..giler la..lagi 37 tahun baru samapai turn aku..aku kira umur aku time tu..dalam 68 tahun..haha...ntah hidup lagi aku tahun tu pun aku tak berapa nak sure sangat..ntah-ntah dah padam kot..haha..Cuba korang lak pegi register kat Tabung haji..tgk tahun berapa korang dapat..haha..


Aku tanya pakcik tu macam mana nak pegi cepat..dia cakap ikut pakej..yang harga rm 22 ribu ke atas..huhu..mana nak cari..nak tunggu turn aku tu..lama la pulak..Tapi aku ada cara macam mana untuk pegi awal..bagaimana?buat simpanan dalam unit trust selama 15 tahun...pastu duit korang cukup untuk pegi haji melalui pakej (bukan pegi sorang but pegi berdua)...untuk info lanjut,korang boleh contact aku,Nazri 017-377 6235, atau melalui email, kelisa_cooper@yahoo.com..dan aku akan terangkan dengan lebih lanjut..