Malaysia Finance Data

Time zone		UTC+8
Total area		329,847 km² (2006)
Capital		Kuala Lumpur (2009)
Currency		ringgits (MYR) (2009)
Government type		constitutional monarchy (2009)
Languages		Bahasa Malaysia (official), English, Chinese (Cantonese, Mandarin, Hokkien, Hakka, Hainan, Foochow), Tamil, Telugu, Malayalam, Panjabi, Thai
Religions		Muslim 60.4%, Buddhist 19.2%, Christian 9.1%, Hindu 6.3%, Confucianism, Taoism, other traditional Chinese religions 2.6%, other or unknown 1.5%, none 0.8% (2000 census)
Total population		27.76 million (2009 forecast)
Urban population as % of total population		68% (2006)
Population median age		25.0 years (2006)
Population growth rate		1.80% (2006)
Life expectancy		74 years (2007)
Adult literacy		92% (2000/2007)
% of population living on less than $2 a day		7.80% (2008)
Inequality of wealth distribution (Gini index)		49.2 (2007) (0=perfect equality, 100=absolute inequality)
Freedom House rating		Political Rights: 4 Civil Liberties: 4 (2009) (1 represents the most free, 7 the least free)
Total telephone subscribers as % of population		104.23% (2007) (sum of fixed telephone lines and mobile cellular subscribers)
Internet users as % of total population		55.67% (2007)
Cost of living - Mercer index (ranking by city on a basis of 143; the 1st is the most expensive and the 143rd is the least expensive; New York is the base city)		New York - Index: 100 (Base) Kuala Lumpur: 106th - Index: 75 (2008)
CO2 emissions		7.0494 (2004) (metric tons of CO2 per capita)

ECONOMIC INFORMATION

Central bank		Central Bank of Malaysia (2009)
Reserves of foreign exchange and gold		$104.4 billion (31 December 2008 est.)
GDP		180,714 millions of US dollars (2007)
GDP (Purchasing Power Parity)		355,225 millions of International dollars (2007)
Real GDP growth		2000 2002 2003 2004 2005 2006 2007 2008 8.68% 5.39% 5.79% 6.78% 5.33% 5.78% 6.35% 4.60% 2009: -3.50% (forecast)
GDP per capita - current prices		$6,956.41 (2007)
GDP per capita - PPP		$13,385.13 International Dollars (2007)
GDP (PPP) - share of world total		0.53% (2008)
GDP - composition by sector		agriculture: 9.7% industry: 44.6% services: 45.7% (2008 est.)
Gross domestic expenditure on R&D (% of GDP)		0.60% (2004)
Inflation		2006: 3.59% 2007: 2.106%
Unemployment rate		3.7% (2008 est.)
Household saving rates		-
Public debt (% of GDP)		-
Sovereign bond ratings		Standard & Poor's: A-/Stable/A-2 Moody's rating: A3 Moody's outlook: STA (Foreign Currency, March 2009)
Market value of publicly traded shares		US$325.7 billion (31 December 2007)
Largest companies in Malaysia		Maybank, Sime Darby, Tenaga Nasional, Public Bank, Bumiputra-Commerce (2009)
FT top 50 banks in the world by market value 2009

DATA ON TRADE AND COMPETITIVENESS

Current account balance		US$ 31.77 billion (2008)
Share of the world export		-
Shares in world total merchandising export		1.26% (2007)
Shares in world total commercial services export		0.86% (2007)
Total exports		US$195.7 billion f.o.b. (2008 est.)
Export commodities		electronic equipment, petroleum and liquefied natural gas, wood and wood products, palm oil, rubber, textiles, chemicals
Total imports		US$156.2 billion f.o.b. (2008 est.)
Import commodities		electronics, machinery, petroleum products, plastics, vehicles, iron and steel products, chemicals
Exports - major partners		US 15.6%, Singapore 14.6%, Japan 9.1%, China 8.8%, Thailand 5%, Hong Kong 4.6% (2007)
Imports - major partners		Japan 13%, China 12.9%, Singapore 11.5%, US 10.8%, Taiwan 5.7%, Thailand 5.3%, South Korea 4.9%, Germany 4.6%, Indonesia 4.2% (2007)
Inward FDI flows by host economy		US$8,403.1 million (2007)
Value of cross-border M&A, by country of purchaser		US$4,783.158 million (2007)
Cross-border M&A deals worth over $3 billion completed in 2007 (Acquiring company, Acquired company, Country of the acquired company, Value of the deal)		- (Acquiring company, Acquired company, Country of the acquired company, value of the deal)
Best countries for doing business (ranking by country on a basis of 181, the first is the best)		Overall ranking: 20(2009) Subcategories: Starting a business: 75(2009) Employing workers: 48(2009) Registering property: 81(2009) Getting credit: 1(2009) Protecting investors: 4(2009) Trading across border: 29(2009)
Global competitiveness ranking		21 (2008/2009)
Economic freedom index (ranking by country; the first is the best)		64.59(2009) (100=totally free 0=totally repressed )

GLOBAL FINANCE RANKINGS AND AWARDS

TOP 200 EMERGING MARKET BANKS 2008

• Malayan Banking Berhad (2008)
• CIMB Bank Berhad (2008)
• Public Bank Berhad (2008)
• RHB Bank Berhad (2008)
• Hong Leong Bank (2008)
• HSBC Bank Malaysia (2008)

WORLD'S BEST FOREIGN EXCHANGE BANKS

2009:

• COUNTRY WINNERS Maybank (National, 2009)

2008:

• COUNTRY WINNERS Maybank (National, 2008)

WORLD'S BEST TRADE FINANCE PROVIDERS

2009:

• COUNTRY WINNERS Maybank (National, 2009)

2008:

• COUNTRY WINNERS Maybank (National, 2008)

WORLD'S BEST INTERNET BANKS

2008:

• COUNTRY WINNERS / Best Consumer Internet Banks Citi (2008)
• COUNTRY WINNERS / Best Corporate/Institutional Internet Banks Standard Chartered (2008)

WORLD'S BEST ISLAMIC FINANCE INSTITUTIONS

2009:

• REGIONAL WINNERS CIMB Islamic Bank (Asia, 2009)
• COUNTRY WINNERS CIMB Islamic Bank (National, 2009)

2008:

• COUNTRY WINNERS CIMB Islamic Bank (National, 2008)
• REGIONAL WINNERS CIMB Islamic (Asia, 2008)

WORLD'S BEST EMERGING MARKET BANKS

2008:

• COUNTRY WINNERS Maybank (National, 2008)

WORLD'S BEST SUB CUSTODIANS

2008:

• COUNTRY WINNERS Maybank (National, 2008)

CENTRAL BANKER REPORT CARD

2008:

• Grade: B (Zeti Akhtar Aziz, 2008)

ARTICLES AND COUNTRIES REPORTS FROM GLOBAL FINANCE ARCHIVE

• Features : Malaysia: Turning The Corner (2 matches)
  Archives > July/August 2005
• Features : Moving (2 matches)
  Archives > May 2004
• Features : Opening For Business (1 match)
  Archives > July 2007
• Emerging Markets : Will Palm Oil Be Asia’s Biofuel? (1 match)
  Archives > May 2007
• Features : The World’s Best Sub-custodians (1 match)
  Archives > July/August 2005

source : Global Finance

Choose a mutual fund using numbers ?

Making investment decision based on historical records is NOT the best way. However, it is one of the FEW methods that is measurable. This method cann't say much about the future but it absolutely show evidence to what they have promised before ie. the goal of the fund itself.

There are 38 mutual fund companies in Malaysia, more than 530 funds have been launched in the market. There is about 160 billion ringgits Net Asset Value all together. Making it the largest component (20%) in the whole Malaysia stock market.

Below shows all the funds performance information for 4 companies;

Public - 67 funds,

OSK - 34 funds,

AMB - 15 funds and

TA - 16 funds.

That is a LONG list to look at. However, if we focus on a few criterias ;

1. Funds that are more than 5 years old

2. Funds that have received good ratings from 3rd party

3. Equity or moderate to high risk fund, ie. exclude bond and income

More than 75% of the funds can be filtered out immediately!

Then just plot some graphs to look at each of the remaining funds, try to see if one is MORE "Apparently Better" than another.

This is the short list result from this exercise;

PB Growth

Public Growth

Public Ittikal

Public Regular Savings

Public Savings

AMB Ethical Trust

AMB Value Trust

OSK-UOB Equity Trust

OSK-UOB Kidsave Trust

TA Growth

TA Islamic

Still a long list to work with ? One may further compare the funds and pick the highest return fund, but that is Highly NOT advisable. Playing with numbers any further than this stage would be considered as obsessity and may result totally irrelevant investment decision.

This list tells the following;

1. These funds have been managed well. The reasons could due to talent, regulation, the goal of the funds ... no matter what the reasons are, they have been managed well for the past 5-10 years.

2. They have performed BETTER than other funds in comparison.

It may also carries these implications:

1. It is unlikely these funds just get lucky continously for 5-10 years

2. Despite all the potentially bad things that may happen,

However, the list DOES NOT mean these ;

1. These are the best funds,

2. These are the funds to buy now,

...

KNM 090706 : double bottom

Just a quick note that KNM showed double bottom last Friday, which is a signal of rebounce; while world market depress over the weekend. It will be interesting to see how KNM ends today.

you can view major world market before yours so you may have an idea of global movement

My support line today is RM 0.75 with a variance of 1 price tick. So if it rebounces at RM 0.755, it could be a bug signal. Else if it breaches 0.745 then it could be free fall to 0.50.

Speculative up strength is 0.80 : so 0.76 to 0.8 is 5% gain, not really a huge opportunity to win lottery.

However, KNM's target buy price is actually at RM 1.10 with target compound return at 15% a year for the next 10 years. So it is also a long term keeper.

Note* Don't buy base on this note. This is a test for technical analyst believers. If you look carefully, did you see any head and shoulder pattern ?

Passive Income Defined - Part 2 ! Effort

It was mentioned before that passive income means obtaining money repeatly while spending minimum effort.

What does minimum effort mean ? Can it be measured ?

Well, lets see. Effort can be classified into two;

1) qualitative - when you have a 'great' idea ! Brain power !

2) quantitative - when you work HARD for it !

Everyone has some good ideas at some point of time. When a good idea hits homerun, it flies like no one's business. It could bring to great wealth or great fame. Either way, this such good idea is hard to pre-determine and would only be known after the effects kick in. Hence your smartness is hard to be measured for planning purpose.

For some of those who have tasted success beofre, they would know that any great idea would also take some hard labour to turn it into a reality. It may be as simple as trying to convince someone on the smart idea itself. But nevertheless need to do something after idea conceiving stage.

Assuming all hard labours are similar by nature. Afterall, you are justing using your energy for something, without the brain. Hence, hard labour can be easily measured using time. For example, you may spend 30 minutes when opening a FD account, then perhaps using 5 minutes to monitor the monthly interest payment. So over a course of 5 years, you would have used 5 and a half hours in total.

Everyone has some worth in dollar sense. If you are working and your monthly salary is $3,000. And you actually work 40 hours a week resulting a monthly productive hours of 160. Then your productive worth would be $3,000 divided by 160 which is $18.75. Meaning if you spend one hour to do some productive work, your time cost is $18.75 per hour.

If we use 24 hours and 30 days a month, then your life worth would be $ 3,000 divided by 720 (24 x 30 ) = $4.17. For every hour you live, whether doing something or not, you have earned $4.17.

You may use either productive worth or life worth, its only a matter of philosophy.

If we use productive worth for the FD example earlier, 5.5 hours would imply 5.5 x 18.75 = $103.12 worth of effort spent over the 5 years; or an average of $20 a year. If the guy had save $10,000 with 2% FD rate, then he would get back $200 a year. $20 effort to earn $200 income is 10 times. The Effort Income ratio is said to be at 1:10

If you are a retiree, you probably do not have any productive worth. Lets say if you also have $3,000 income consistently from whatever source, then your life worth would be $4.17 as calculated above. With this your FD effort cost is only $23 over 5 years or barely $4.60 a year. In this case, effort income ratio is 1:43

With such a calculation, a few concepts have become more concrete;

1. The MORE money you save in FD, the more passive it becomes. If you only save $1,000 on above example, you probably cann't say you are earning passive income at all. Perhaps you may even be losing by spending too much effort monitoring it. On the other hand, if you were saving $100,000 instead of $10,000 then the young worker ratio may become 1:100 instead of just 1:10

When effort needed is the same,

increasing capital on passive income

will make it more passive.

Which is also the typical term people refer as "Money earns Money"

2. The period of consideration is important. For example in the FD example, if you only save for one year. then the effort income ratio is only 1:7 instead of 1:10 if you save for 5 years.

1.5 hour x $18.75/hour = $28.12. Earning $200 interest out of this 28.12 is 1:7.11

Likewise, if you leave your FD there for 10 years, the ratio will go up.

The longer you let the right finance vehicle runs by itself,

the more passive the income becomes.

3. The FD interest earned, although in same amount, but it is much more worth while for the old retiree to do it than the young worker. The young worker could have just work extra 2 hours to earn the same as FD's return in a year. The retiree on the other hand has not much to do anyway.

Not to mention some retirees do NOT have $3,000 income consistently, in that case the effort income ratio would even be much higher. In MalPF's world, any investment that can provide a 1:100 effort income ratio is considered a Passive Income.

Be reminded this is only refering to the 'minimum effort' portion. A true passive income has to happen repeatly. So winning jackpot in casino is not a passive income unless you actually have a way to win every month.

There may also be a few other not so direct implication on passive income after this exercise ;

1. Usually passive income starts with high effort in the beginning, then eventually the effort lowers to its supposed minimum level while the income starts to kick in. The more effort you put in the beginning, the higher chance to have a higher passive income in future. But it may also takes longer to reach there.

2. Passive income is a very personal thing. What works for you may not work for others. Its all about your current situation, your passion and what you do best. For example, if you are a talent in collecting rent, you may only need 5 minutes to do it. On the other hand, a shy landlord may need to make a few trips and a total of 4-5 hours a month to collect one payment.

3. If you have capital in the beginning you need less effort. Like wise if you have no capital, you will have to use a lot of effort in the beginning. Like most of the human networking programs ...

Have you run your own numbers yet ? Is your income really passive ? Or have you been worrying too much about it ?

Try read this article, it may help making your income more passive ... simply by NOT KNOWING about it once the right finance vehicle is setup.

Passive Income Defined - Part 1 !

Are there such thing as totally passive income ? As in you do absolutely Nothing and money comes to you ?

To earn fix deposit interest, you will actually have to walk right up to the bank, go through all those paper work, spend some time there to open an account. When you want to use the money you earn from the interest, you will have to go to the bank again to withdraw it. Not exactly as 'absolutely nothing'.

So many may argue there is no such thing as total passive income. But then again, that is only a matter of definition. Although it is a good thing to believe there is no Free lunch in this world, but the true definition of 'passive' is NOT "No effort" at all. It actually means 'with minimum effort'.

So Passive Income is a type of income you obtain repeatly with minimum effort.

In finance world ( NOT personal finance ), passive income is instinctively associated with rental income. This is the main reason why most people carry on the miss conception of property investment as a passive income vehicle into personal finance. This is another article but in short, rental may become a passive income but property investment is NOT.

So what does Minimum Effort actually mean ? Generally there are a few responds;

1. Do Once: Like the Fix Deposit example, you only do some work once and then enjoy the monthly interests without any more work needed. Hence the effort is minimum in long run.

2. On the way anyway: Collecting monthly rental income is relatively an easy task especially when you have a good tenant and the property is just next door. So you were just passing by anyway, collecting extra income while doing other things is really neglectable effort and therefore considered as minimum.

Minimum effort is when you FEEL like not doing much. Guess what, you will most likely feel like that when things are smooth and great going.

For example, when opening a fix deposit account the traditional way, you may actually feel cumbersome of all the paper work and may be frustrated that you have to repeatly mention the same information. Only when the account is finally opened and the interest starts to come in, you feel it was just all just minimum effort anyway.

So minimum effort has a Time factor.

The effort of collecting rental income may become not so minimum anymore when the tenant starts delaying payment; No one answer the door bell and you have to make a few more trips. Partial payment, broken items, wall repaint and other not-so-smooth-going experience may change your effort to not-so-minimum anymore.

If this so call 'minimum effort' or 'passiveness' is so subjective to experience and highly affected by the cycle of good-bad times.

No wonder when someone shout certain business can generate passive income, the other person will say no and yet both of them have very good points supporting their views. Its because they have different 'feeling' and may analyse the business at different time points.

Among all these uncertainty of feeling and potential changes over time, how can we reliably determine if an investment can provide passive income and if its worth it or not ?

Luckily in MalPF, there is a measurable way in defining 'Passive Income'.

... Read Part 2 ...