Islamic Investment which is known as Shariah Compliant Investment is a growing industry, which is getting popular nowadays and more seriously considered by all consumers around the world.
There’s an estimate that this market will grow rapidly in the next 5-10 years, fuelled by the wealth from oil, property and the growth in the Middle East. There’re many banks looking to get into this opportunity, and Islamic Structured Products are at the cutting edge of Islamic Investment.
Islamic investment accounts are counterparts of fixed deposits offered by conventional banks. Of the two, Islamic investment accounts provide slightly higher returns. The latest data from Bank Negara Malaysia’s monthly statistical bulletin for July showed that the average rate for 1 month placements in Islamic investment products was 2.93% compared with 2.91% for conventional fixed deposits.
Guaranteed rental return (GRR) schemes are highly attractive options for property investors. However, the promises can sometimes result in the wrong choice being made.
Being promised a guarantee 7.5% rental return every year will immediately set off one’s internal calculator and the thought of getting some RM1600 per month sounds very attractive indeed. However, we should rather think what happens after few years of high returns? What types of return can we expect for the subsequent years if things going in unpredictable way? It is important to understand that buying a property is for the long haul and is crucial to ensure the long term viability of the purchase and not be distracted by short term gains.
One of my friends, Kate started trading on local stock exchange about one year ago after hearing her friends talk about catching stocks on their uptrend and receiving regular dividend payouts.
She didn’t have any experience but just armed with finance and accounting degree and basic understanding of business. She invested in local stock market and a few of her shares went up but she did not hold on to them. She traded aggressively sometimes making as many as 5-10 online trades per day. However, she was surprised to discover that her portfolio was making a loss due to the high brokerage fee. Thus, a brokerage fee is crucial as it will eat into the profits and may actually end up with thin gains.
Brokerage fees are mostly capped at 0.7% of the transacted value. On average, online platform provides charge a brokerage rate of 0.42% while for remisier, the rate is 0.6% of the transacted value. So, it is usually cheaper to trade online.
MYEG Services Bhd is engaged the electronic government services project. Its businesses are divided into 2 categories: government to citizen (G2C) and government/enterprise solution (GES). G2C services refers to the services such as issuance and renewal of licenses, online bill payment, as well as online information services, such as traffic summons checking and online bankruptcy status searches. GES refers to the non-Internet based services, such as software development and maintenance, as well as services rendered at the E-Services Centers.
MYEG 2nd quarter net profit ended March 31, 2012 advanced 16% to RM7.2mil from RM6.2mil against the corresponding quarter in the previous year. In the financial statement, MYEG attributed the improved results due to its implementation of cloud computing services, and higher volumes of road transport department (JPJ) related services. I can see that they are still striving to provide innovative and new services to become Malaysia’s first leading e-government service provider.
Zero Entry Cost (ZEC) housing loans means bank will absorb the legal fee, stamp duty and valuation fees. However, it can result in an unhealthy price war in the banking industry due to it ate into their profit margins.
There’re few financial institutions (e.g AIA, ING, MBSB and Kuwait Finance House Bhd) that are offering Zero Entry Cost housing loans in the property markets. Those who offering this kind of scheme are actually making the housing loan market more competitive. As we can see, the current interest rates are as low as BLR -2.3% to BLR -2.5%, compared with the previous range of BLR -1.8% to BLR -1.9%. Besides that, the loan approval rate will be lower nowadays due to the implementation of credit-tightening measures. Thus, ZEC housing loans are not profitable especially if the loans are offered at a competitive interest rate.