WHAT IS ETFs?
ETFs invest in a group of stocks or bonds or other instruments which track the performance of an index. ETFs are listed and traded on a stock exchange.
WHY INVEST IN ETFs?
TRADE LIKE STOCKS Just like stocks, you can buy and sell anytime throughout the trading day.
FULLY TRANSPARENT
Prices are available real-time throughout the trading day. The investment portfolio is fully transparent as it tracks an index.
EFFICIENT WAY TO DIVERSIFY
You can easily gain exposure to a group of securities – in a single transaction & at a lower cost compared to managed funds.
FAQ
How to invest in ETFs? Where to buy ETFs?
Similar to trading in stocks, you will require two accounts:
A Central Depository System (CDS) account &
A trading account maintained with a brokerYou may buy or sell ETFs through your remisier or via online trading during normal trading hours.
What do I have to pay when buying and selling ETFs?
Like buying and selling stocks, investors need to pay brokerage commission, stamp duty and clearing fees.
What determines the price of an ETF?
The market price of an ETF is usually very close to the Net Asset Value (NAV) of the fund ie. market value of the underlying stocks and any net income not distributed. However, the price of an ETF can be affected by demand and supply in the market.
What are the expected returns?
Investment returns generally correspond to the price and yield performance of their underlying indices.
What is the minimum investment units?
ETFs are traded in minimum traded lots (board lots) of 100 units.
Do ETFs pay dividends?
Most ETFs pay dividends to their holders either half yearly or yearly. You are advised to refer to the distribution policy in the prospectus or offering document of the ETF.
How are transactions in ETFs settled?
In the same manner as share transactions ie. not later than 3 working (market) days after the transaction date (T+3).
Is there any risk?
Yes, investing in ETFs, as in investing in stocks, is subjected to the same ups and downs of the market. The performance of the ETF may be directly affected by the performance of its component stocks or bonds.
What should I do before investing in an ETF? You are advised to know the following before investing:
Investment objective & strategy of the ETF
Information on the index that the ETF is tracking
Dividend policy
Fees & charges that will be borne by you as an investor
Sources of trading information of the ETF
Information about the management company
Just got to know about ETF and found that this Equity Exchange Traded Fund is like unit trust (equity linked) and provide better flexibility to us! Anyone have tried it?
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The Star Online: Business
Sunday, January 20, 2008
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SHARE TRADING
1. Selecting securities
2. Market direction
- decide on time frame
- confirm the market direction
3. Trend direction
4. Entry signals
- take entry signals from a suitable momentum oscillator
- use trailing stops to time entry and exit points
5. Stop losses
- set stop loss order as soon as your trade is confirmed
- do not exceed the maximum acceptable loss
- be technically consistent when setting stop levels
- adjust stop levels over time to protect your profits
6. Take exit signals from a suitable trend indicator
A Word Of Caution
These are typical steps that a trader will follow in deciding what stocks to buy, when to buy them and when to sell. It is not a magic formula, but consistent use should enhance your investment performance.
Trading methods can be compared to a carpenter's tools: Skilled use can produce outstanding results but unskilled use may lead to injury. Learn to use your trading tools properly before committing any capital. Study the behavior of the indicators over several years, learn their strengths and weaknesses and how they interact with each other and with the market. Start with a small amount of capital and only increase this when you are confident that you have a winning strategy.
2. Market direction
- decide on time frame
- confirm the market direction
3. Trend direction
4. Entry signals
- take entry signals from a suitable momentum oscillator
- use trailing stops to time entry and exit points
5. Stop losses
- set stop loss order as soon as your trade is confirmed
- do not exceed the maximum acceptable loss
- be technically consistent when setting stop levels
- adjust stop levels over time to protect your profits
6. Take exit signals from a suitable trend indicator
A Word Of Caution
These are typical steps that a trader will follow in deciding what stocks to buy, when to buy them and when to sell. It is not a magic formula, but consistent use should enhance your investment performance.
Trading methods can be compared to a carpenter's tools: Skilled use can produce outstanding results but unskilled use may lead to injury. Learn to use your trading tools properly before committing any capital. Study the behavior of the indicators over several years, learn their strengths and weaknesses and how they interact with each other and with the market. Start with a small amount of capital and only increase this when you are confident that you have a winning strategy.
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HOW TO INVEST???
Prior to listing, during the placement subscription period, Retail Investors can subscribe for the Units through the placement agent and the selling agents at a 5% discount to the initial issue price (calculated daily).
Institutional Investors can subscribe at a 2% discount to the initial issue price. The minimum application size is 1,000 Units or whole multiples thereof during this period.
Upon listing, MyETF-DJIM25 will be traded on Bursa Malaysia Securities in the same way as any other publicly listed company. The buying and selling of MyETF-DJIM25 units can be conducted through any Bursa Malaysia Participating Organisations during normal trading hours.
Investors may also participate in MyETF-DJIM25 through creation of new units through the Participating Dealers.
Participating Dealers: CIMB Investment Bank Berhad and OSK Investment Bank Berhad
Placement Agent: CIMB Investment Bank Berhad
Selling Agents: Aseambankers Malaysia Berhad and Affin Investment Bank Berhad
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