Investment Talk

Yesterday I was the privileged few that was "invited" to attend an investment talk on hedge funds. It was organized by a reputable bank and they only invite their "member". The reason I have the "member" words in in-quote is to be a member, you need to have a certain wealth accumulated to be a member.

Anyway, back to the main idea of this posting. The evening started with a Chinese style dinner and we were served with cold dish appetizer, Ginseng Chicken soup, Patin fish, roast chicken, abalone with scallop and Chinese cabbage, fried vege, glutinous rice with waxed duck and Chinese sausage and have red bean soup with jelly and pancake for dessert.

A speaker from a hedge fund company came out after the serving of the roast chicken and started to educate the crowd about the difference between hedge funds and mutual funds. His idea was good... he term it as.. "...if you have an amount in your saving that you do not know what to do, and do not want to take too high risk, then hedge fund is the option". He went on to explain the mechanism of hedge fund and mentioned the stability of the hedge fund as compared to other type of funds. He presented for about 45 minutes or so, then the representative from the bank came out to present the portfolio and details about the hedge fund they are offering.

The starting investment capital is high and is only offered to 'elite' investor, hence those sitting inside the dining room only. This is not a fund that is open to the public as it is govern by our national banking guideline that this funds is only to be sold for the 'elite' investor and the term 'elite' investor is the member of the bank.

After the bank representative presented, one of the slides I noted is the charges to open the hedge fund portfolio, it is at 7% which means at RM100k, the bank charges is already at RM7,000 and I did a little mathematics, since the day this hedge fund was launched in March 2008 until middle of Jan 2009, those that have invested yet to get their return or I would say it is still in the RED.

After all the presentation, the table where me and my gf's family was seated, a bank manager came to explain and I think he was a bit uncomfortable with a few questions I asked.

During the presentation, I took down some notes and exchanged a few words with my gf and her mom and brother, basically, we felt that it is not really worth the investment. Perhaps we were wrong. Perhaps this is a good investment for long term, which will yield approx 8% to 10% pa.

Personally, I think at this current situation where the whole world is just about to recover from the economic crisis back in 2008 and 2009, if you have any amount of spare cash, just simply pick any funds, be it mutual trust fund, or dividend fund etc, put the money in and over the next 2 to 5 years, it will definitely generate some returns.

However, as any investment, there will be risk. If you are the person who is not too keen on risking, then just put it into something more solid e.g. properties and be a landlord and collect rentals or even buy gold coins. Of course, being a landlord comes all the headache of rental collection, finding the right tenant, repair and maintenance of the properties etc. All these comes to the Chinese saying, if you don't work hard, how to find the world wealth?

Overall, the talk yesterday was good. I learn a fair bit of things and enjoyed the dinner. It was so happen that yesterday was also the Chinese "Lap Choon" which means the official beginning of Spring, which is suppose to be Chinese New Year, but the celebrated date of Chinese New Year is not another week or so. It was nice to be able to sit and have dinner with my gf's family member which we are able to talk and interact as a whole family and personally I think the dinner is more like a bank sponsored family dinner where we had some good time enjoying the atmosphere and the good food they prepared.