Amanah Saham Bumiputera (ASB) vs Unit Trust Fund

Comparison	ASB	Malaysia Equity based Unit Trust Fund
Unit Price	The unit price for ASB is fixed at RM1 per unit. ASB is what you call a fixed price fund. That means if you invest RM1000 into ASB, you'll get a 1000 units in return. After twenty year, if you intend to redeem your units, the 1000 units is sold at the price of RM1/unit as well. With the unit price fixed, investors need not worry about when is the best time to redeem their units.	The unit price of Unit Trust varies according to the daily Net Asset Value of the fund. Normally if the stock market is bullish, the unit price of a unit trust goes up and vice versa. Say for example you invest RM1000 into a fund that is currently price at RM1/unit. You'll get 1000 units in return. After 20 years, say the price per unit has gone up to RM1.50/unit, selling your 1000 units will return you RM1500. Investors are exposed to the possibliity that the unit price at the point of redemption could be lower then the price when they purchase the unit. This however can be mitigated using the Dollar Cost Averaging method.
Dividend + Bonus	Annually, ASB will announce it's dividend and bonus returns. For 2012, ASB distributed 8.9% worth of dividend  and bonus. Investors can choose to reinvest by purchasing more ASB units or withdraw the distribution.	Most unit trust funds declare yearly dividend. The dividend varies from one fund to the other. Dividend can range from 1% - 10% depending on the performance of the fund. However during a bear market, most equity based fund will not announce any form of dividend. Dividend is normally reinvested via purchasing  of more units from that fund.
Average Annual Returns	ASB's average return is  8.82% per annum for the past 3 years.	Top performing Malaysia Equity (Islamic) Unit Trust fund such as Kenanga Syariah Growth Fund (KSGF) averaged about  19%  per annum for the past 3 years. Investors should be advised that the longer the period of investment, the lower the average annual returns would be.  KSGF for example averaged about 12.63% per annum over a period of 5 years.
Fund Flexibility	As of 31 Dec 2013, ASB manages about RM110 billion worth of funds. For example, 22.92% of ASB funds are invested into financial insitution comprising of Maybank, CIMB, Public Bank and RHB. If ASB decides to sell all their shares, the resulting price drop of these 4 banks is unimaginable. Like it or not, ASB is tied down with the responsibility to stay invested in these companies in order to prevent the above scenario above happening.	Unit Trust Fund size ranges between RM 10 million to RM500 million. By having a smaller fund size, fund managers can afford to trade (buy and sell) shares without worrying about the impact on a particular company. The flexibility to invest allows unit trust funds to prevent any catastrophic losses during a bearish market. This is also why unit trust fund tend to perform better during a bull market.
Stability	Investing in ASB provides the feeling of stability for many investors. Even during a bear market, ASB is able to announce dividend to investors as seen during the 2008 economy crisis. By fixing their unit price at RM1/unit, investors are reassured that no matter what happens to the market, they are still able to redeem their units at RM1/unit. To read more about how ASB is able to declare dividend even during a bear market, click HERE.	As mentioned earlier, the unit price of an equity based unit trust fund varies according to the share market. During the 2008 economy crisis, KSGF loss about 26.02%. However the fund was able to rebound back with a 30.42% gain in 2009. The orice volatility of a unit trust fund is one of the reason why many investors are afraid to invest into unit trust.
Investment Limit	Each investors is limited to a max investment amount of RM200,000 only.	Investors can invest as much as they want. The fund will stop selling units once the fund size limit is achieved.
Annual Fund Management Fee	The Fund Management fee for ASB is 0.35% for 2012.	The Fund Management fee for Equity Based Unit Trust Fund ranges from 1.2% - 2.0%
Sales Charge Fee	None	Between 1% - 5.5% depending on type of fund
Syariah Compliant	There's still an ongoing debate whether ASB is a syariah compliant fund or not.	Whether a unit trust fund is syariah compliant or not is clearly stated in the prospectus.
Invest via EPF	ASB does not allow investment via EPF withdrawal.	Certain approved unit trust fund such as KSGF allows EPF withdrawal for investment.
Who Can Inevst?	Open to Bumiputera only	Open to Malaysians
Who Should Invest?	Investors who  prefer stability and consistent returns ranging from 7-9% per annum.	Investors who are willing to take risk in order to enjoy higher returns ranging from 10% - 20% (after deducting annual fund management fee) depending on the period of investment.
Potential Profit	Sample Calculation : ASB returns  per year - 8.5% Initial Amount Invested - RM10,000 Yearly Contribution - RM2,400 Profit after 20 years = RM177,094.20	Sample Calculation : Unit Trust returns  per year - 12% Amount Invested - RM10,000 Yearly Contribution - RM2,400 Profit after 20 years = RM290,139.90

Cheers and Happy Investing.

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