The Edge-Lipper 2013 Awards Results!

Malaysia's The Edge-Lipper 2013 Awards, a premier annual event to honour the best performing unit trust funds and fund houses concluded last night at the Hilton, Kuala Lumpur. Akin to the Oscars which coincidentally was also held yesterday, the Edge-Lipper Awards is one of the most sort after recognition by all the fund houses. Winners of this award get to have the bragging rights for the next one year and at the same time boost their fund's credibility. A total of 44 awards were given out of which 9 awards are newly introduced (as if there is not enough categories already). The 9 new categories are:

1. Equity ASEAN (3 Year)
2. Equity Greater China (3 Year)
3. Equity Malaysia Diversified (3 Year)
4. Mixed Asset MYR Flexible (Islamic) (3 Year)
5. Equity Asia Pacific (5 Year)
6. Mixed Asset MYR Bal - Global (5 Year)
7. Mixed Asset MYR Flexible (Islamic) (5 Year)
8. Equity Malaysia Diversified (5 Year)
9. Equity Malaysia Diversified (10 Year)

Winners of The Edge-Lipper 2013 Awards

The list of winners are shown in the table below. I've also included the list of winners for 2012 just in case you feel like comparing the winners for 2013 with 2012.

Category : GROUP (by Fund House)
Classification	2012 Winners	2013 Winners
Bond	Am Investment	Am Investment
Equity	Pacific Mutual	Hwang
Mixed Assets	MAAKL	CIMB
Overall	CIMB	Am Investment
Category : 3 YEAR (by Fund)
Bond Malaysian Ringgit	AmDynamic Bond	AMB Income Trust
Bond Malaysian Ringgit (Islamic)	PB Islamic Bond	PB Islamic Bond
Equity ASEAN	-	PB Asean Dividend
Equity Asia Pacific	Public Asia Ittikal	Public Asia Ittikal
Equity Asia Pacific Ex Japan	CIMB Islamic Equity	Public Islamic Asia Dividend
Equity Asia Pacific Ex Japan (Islamic)	CIMB Islamic Equity	Public Islamic Asia Dividend
Equity Global	Pacific Dana Dividen	Pacific Global Stars
Equity Greater China	-	Eastspring Investment Dinasti Equity
Equity Malaysia (Islamic)	Kenanga Syariah Growth	Eastspring Investment Dana Ilham
Equity Malaysia	CIMB Principal Equity	Kenanga Growth
Equity Malaysia Diversified	-	Saham Amanah Sabah
Equity Malaysia Small & Mid Caps	Public Focus Select	Public Focus Select
Mixed Asset MYR Bal - Global	PB Asia Real Estate Income	PB Asia Real Estate Income
Mixed Asset MYR Bal - Malaysia (Islamic)	CIMB Islamic Balanced Growth	CIMB Islamic Balanced Growth
Mixed Asset MYR Bal - Malaysia	Hwang Select Balanced	Hwang Select Balanced
Mixed Asset MYR Conservative	Hwang Select Income	Hwang Select Income
Mixed Asset MYR Flexible	MAAKL-HDBS Flexi	MAAKL-HW Flexi
Mixed Asset MYR Flexible (Islamic)	-	Eastspring Investment Dana Dinamik
Category : 5 YEAR (by Fund)
Bond Malaysian Ringgit	AmDynamic Bond	AmDynamic Bond
Bond Malaysian Ringgit (Islamic)	PB Islamic Bond	PB Islamic Bond
Equity Asia Pacific	-	Public Asia Ittikal
Equity Asia Pacific Ex Japan	Pheim Asia Ex-Japan Islamic	Public Islamic Asia Dividend
Equity Global	Pacific Focus 18	Pacific Global Stars
Equity Malaysia (Islamic)	Kenanga Syariah Growth	Hwang AIIMAN Growth
Equity Malaysia	AMB Value Trust	Kenanga Growth
Equity Malaysia Diversified	-	Saham Amanah Sabah
Equity Malaysia Small & Mid Caps	Public Small Cap	Public Focus Select
Mixed Asset MYR Bal - Global	-	PB Asia Real Estate Income
Mixed Asset MYR Bal - Malaysia (Islamic)	Apex Dana Al-Faiz-I	Apex Dana Al-Faiz-I
Mixed Asset MYR Bal - Malaysia	Apex Dana Al-Faiz-I	Hwang Select Balanced
Mixed Asset MYR Conservative	Hwang Select Income	Hwang Select Income
Mixed Asset MYR Flexible (Islamic)	-	InterPac Dana Safi
Mixed Asset MYR Flexible	PRUdana dinamik	MAAKL-HW Flexi
Category : 10 YEAR (by Fund)
Bond Malaysian Ringgit	Public Islamic Bond	Public Islamic Bond
Equity Malaysia	CIMB-Principal Equity	Kenanga Growth
Equity Malaysia (Islamic)	Pacific Dana Aman	Eastspring Investment Dana al-Ilham
Equity Malaysia Diversified	-	Hwang Select Opportunity
Equity Malaysia Small & Mid Caps	Public Small Cap	Public Small Cap
Mixed Asset MYR Bal - Malaysia	OSK-UOB Kid Save	Eastspring Investments Balanced
Mixed Asset MYR Bal - Malaysia (Islamic)	CIMB Islamic Balanced	Dana Makmur Pheim

Note : Click on fund to download fund factsheet. For Public Mutual, all their fund factsheets are lumped into a single document. To download:

• Public Series Funds, Click HERE
• PB Series Funds, Click HERE

Total Number of Awards according to Fund Houses

Fund House	No. Awards
Public Mutual	14
Hwang	6
Eastspring	5
Kenanga	3
MAAKL	2
Pacific Mutual	2
Saham Sabah	2
Amanah Mutual	1
Am Investment	1
Apex Investment Services	1
CIMB	1
Inter-Pacific Asset Maagement	1
Pheim	1
Total	40

Summary of The Edge-Lipper 2013 Awards
This is my personal summary for the awards:

• Comeback Kid : Public Mutual (14 Awards this year as compared to 6 in 2012)
• Biggest Loser : CIMB (Won only 1 for 2013 as compared to 6 in 2012 and also lost the overall title to Am Investment)
• Most Improved : Eastspring (Won 4 for 2013 as compared to 0 in 2012)
• Newcomer : Saham Sabah
• Most Consistent : Hwang and Kenanga

And I just can't help but to bring this up...

It's official...we're NO MORE the best :(

What does it feel like to eat humble pie this year???

Cheers and Happy Investing!

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Discovering Malaysia's Actual Inflation Rate!

I'm sure that some of you would have heard from family and/or friends talking about Malaysia's "actual" inflation rate "supposedly" being much higher then the figures released by the Government. In my previous article, I wrote about the basics of GDP and it's relationship with inflation, this article would be about my own attempt to decipher the real "inflation rate" of our beloved country!

Malaysia's Inflation Rate as what we read on the Papers/Website:

Year	Inflation Rate
2003	1.07%
2004	1.42%
2005	2.94%
2006	3.62%
2007	2.03%
2008	5.40%
2009	0.60%
2010	1.70%
2011	3.20%
2012	1.20%

In terms of global ranking (lowest to highest inflation), Malaysia ranks 27 out of 224 countries. Looking from that perspective, many would consider Malaysia an affordable place to live in due to it's low inflation rate as compared to neighbors such as Thailand (ranked 80 at 3.10%) and Singapore (ranked 122 at 4.40%).

The real reason behind our consistently low inflation rate is due to the price subsidy that our Government provides on certain consumer goods. If you remember my previous article about inflation, the Consumer Price Index is dependent on the price of consumer products and services which would then reflect  upon the inflation rate of the country. When price of consumer products and services go up, so would the inflation rate of the country and vice versa.

While I laud the effort of the Government in trying to ensure that the "rakyat" is able to afford the basic consumers products, these subsidies are slowly eating into our country coffers. The very fact we are able to provide substantial subsidy for consumer goods is because of our good old Petronas natural resources (mainly oil). Imagine what would happen if our natural resources were to deplete 20 years from now?

What are the subsidized Consumer Products?
The list of subsidized products are shown in the table below:

How much is our Government spending on Subsidy?

This comes as a shock to me as well when I saw the figures. In 2012, the expected subsidy amount is RM22.79 billion! 

For 2011, the subsidy is RM22.52 billion in comparison to Petronas 2011 net profit of RM53billion.

What happens when the oil runs out?
Say for example that the government stop subsidizing these consumer products, what would the actual inflation be?

First we need to see the % subsidy for each consumer product which I have summarized in the table below:

Products	Actual Price (RM)	Price after Subsidy (RM)	% Subsidy
RON95	2.85	1.90	-33.33%
Diesel	2.82	1.80	-36.17%
LPG 10kg	32.84	19.00	-42.14%
LPG 12kg	39.41	22.80	-42.15%
LPG 14kg	45.98	26.60	-42.15%
Tepung	1.98	1.35	-31.82%
Gula Kasar	2.84	2.50	-11.97%
Minyak Masak	4.75	2.50	-47.37%

Next is to factor the % subsidy into Consumer Price Index (CPI) for 2012 as shown in the table below:

Products	Product CPI Weightage in % (A)	% Subsidy	Product CPI as 31 Dec 2012 (B)	Actual Product CPI Increase after Subsidy Removal ( C)	(D) = (A) x (B)	(E ) = (A) x (C )
RON95	8.77%	34.75% *	106.80	163.68	14.35	9.37
Diesel
LPG 10kg	0.46%	42.15% **	106.00	183.23	0.84	0.49
LPG 12kg
LPG 14kg
Tepung	0.37%	31.82%	100.50	147.40	0.55	0.37
Gula Kasar	0.25%	11.97%	136.90	155.52	0.39	0.34
Minyak Masak	0.50%	47.37%	100.40	190.77	0.95	0.50
		Sum			17.09	11.07
		Overall CPI Increase = Sum (D ) - Sum (E)			+6.02

*for ease of calculation RON95 + Diesel Subsidy are averaged out

** for ease of calcuation, 42.15% is taken as general subsidy for all 3 LPG products

Looking at column 2 of the table above, all 8 items contribute a total of 10.35% of the overall Consumer Performance Index. 

Once the subsidy is removed, the CPI for each of these product would increase (see column 5 of the table above). 

The increase of CPI for each product causes an increase in the overall CPI according to the respective % weightage. By making some simple calculation, we see that the overall CPI increased +6.02 points when subsidy is taken out of the picture.

What is the actual inflation for 2012?
To calculate the actual inflation, the following information are needed:
Overall CPI for Dec 2011 = 104.2
Overall CPI for Dec 2012 = 105.5
New Overall CPI for Dec 2012 = 105.5 + 6.02 = 111.52

Actual Inflation Rate for 2012 
= (New Overall CPI for Dec 2012 - Overall CPI for Dec 2011 ) / (Overall CPI for Dec 2011) x 100%
= (111.52 - 104.2) / 104.2 x 100%
= 7.02%*

Increase in inflation rate after subsidy removal 
= 7.02% - 1.2%
= +5.82%*

*The values obtained are based on simple rough calculation. These figures should not be used as actual facts.

Summary
The actual inflation calculated above is all but a rough figure estimation. These figures can only be used as a reference for readers to:

• select investments that could offer annual returns which are higher then the actual inflation rate of 7.02%.
• determine at any one time the actual inflation rate of our country by adding 5.82% to the inflation figure released over the news.
• ensure that your savings and investment is sufficient to support your livelihood in the event that the government is unable to provide anymore subsidy in the future.

Cheers and Happy Investing!

If you're reading this, it would do me a great favor to reward my effort by:
1. Sharing it on your Facebook!
2. Like my Facebook Page
3. Subscribing to me. See the "FOLLOW MY ARTICLES VIA EMAIL" section located at the top left? Just key in your email and click Submit.
4. Visit my blog for other articles at http://invest-made-easy.blogspot.com/