Wednesday, January 24, 2007

Retail Participation - Part Deux

Rafeedah Bigbuns said...
Could it be possible that one of the reasons for the apparent lack of retail participation in the market is that a large number of them may have given up investing on their own and instead put their money into Unit Trusts and let others manage their money? Perhaps the Unit Trust companies and their sales people have done their job too well and successfully persuaded a great many people to invest via unit trusts instead of picking stocks themselves.This may be the current situation. I have a feeling that at a later date when unit trust investors find that their investment take too long to give a profit (maybe due to the initial load and management fees) they may well abandon unit trusts and return to investing directly in stocks themselves.

swifz said...
unit trust has done their advertisement well. Look at the 20% dividend that they declare. Sure more will rush in.

doraiddd said...
yusli doesnt think he's king of the world cos he knows he's master of the universe. But then why did a master of the universe exercised and started selling his bursa shares from a year ago when bursa was at 4 bucks? even as recent as last november, he sold at below 7. Doesnt he read dali?? does he not have the confidence??? He should have exercised all, leveraged up and bot more!! Could he not see a rally coming?? Foot-in-mouth disease, indeed, compounded by a total brain bypass. It's wankers like these that really really hurt retailers. It's time to exit the market and sit on my cash profits. Q1 targets have all been achieved within the first month. What more can one want?

Yus baby, lower participation by retail SHOULD be applauded, not derided by you. Markets in developed nations actually sees a much lower retail participation as more and more funds are manged via institutions and professionals. It is also a natural market development phenomena, a growing up kind of thing - or are we led to think the Bursa really wants local retail investors to stay in the dark ages, and punt and kill ourselves slowly with Yusli's song?!

EPF has already allowed for investing via certain unit trusts, and the good results over the last 2 years would be pumped up, which should result in more people jumping on the bandwagon. The majority of early investors using their EPF funds to invest in unit trust in the late 90s mostly got screwed - market tanked, they got screwed, market recoevered, the fund have no more money to invest - generally early participants got the bitter end of the joy stick, and the only one raving are the unit trust sales on commissions and their inept fund managers. This prompted many to withdraw from unit trusts from 2000-2003 and put the funds back to EPF. Now, we should have another rush back to unit trusts - just pick the consistent ones with a good track record. And for heaven's sake, the commissions given to the unit trust sales IS already way way too high - something's gotta give, even private bankers don't get that much, OK!!

Finally, doraiddd (please explain your moniker, cos its bound to be funny), great posting, very funny. The one on Yus selling his Bursa shares just a few months back at RM7 is not one, but two or even three-foot-in-the-mouth kind of thing. Maybe I should give him a call and persuade him to re-enter and buy back Bursa shares now at RM11.30, after all Yus is a retail player also, so must follow his own advice and buy and play! Cheers!

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