investing in myetf-djim25 in myetf-djim25 bursa malaysia’smarket chat 20 march 2010 i-vcap...
TRANSCRIPT
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� ETF Basics
� Key Features of MyETF-DJIM25
� Information on MyETF-DJIM25
� Specific Shariah Features of MyETF-DJIM25
� Performance of MyETF-DJIM25
� Comparison between MyETF-DJIM25 vs. Stocks
� Comparison between MyETF-DJIM25 vs. Unit Trust Funds
� How and Where to Invest in MyETF-DJIM25
� Why MyETF-DJIM25
Contents
� What is an Exchange Traded Fund (ETF)?
� An ETF is a unit trust fund that is listed and traded on a stockexchange
� It invests in underlying securities of a benchmark index with the objective of tracking the performance of that index
� How and where to invest in ETFs
� Stock Exchange (Secondary Market)� Similar to trading in stocks/shares
� Investor only needs a Central Depository System (CDS) Account and a Trading Account with a broker
� Market price changes throughout the day
� Participating Dealers (Primary Market)� Investors may participate via the creation of new units through the appointed participating dealers at NAV (in multiples of 500k units)
Exchange Traded Fund Basics
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Shariah-Compliant / Ethical Investment : Exposure to multiple Shariah-
compliant stocks which generally also fulfil ethical investment criteria
Portfolio Diversification : Risk-return reward is spread among the 25 stocks in
the portfolio through a single transaction
Transparent : Component stocks are known upfront to investors
Tradability : Convenience to track and trade the fund during trading hours on
the exchange
Low Transaction Charges : Transaction charges similar to stocks and lower
than upfront fees charged by most equity unit trust funds
Low Management Fee : Annual management fee lower than actively managed
equity unit trust funds
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Key Features of MyETF-DJIM25
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� MyETF-DJIM25
� Listed on Main Market of Bursa Malaysia Securities
� 1st Shariah ETF listed in Asia and largest Shariah ETF in the world to date (NAV: RM651mil / US$191mil as at 28 February 2010)
� National ETF with seven (7) Government-linked investment companies (GLICs) seeding the underlying basket of securities during initial subscription period
Information on MyETF-DJIM25 (1)
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Information on MyETF-DJIM25 (2)
FUND INFORMATION
The Fund MyETF-DJIM25
Benchmark Dow Jones Islamic Market Malaysia Titans 25 (DJIM25) Index
Investor Profile Suitable for both institutional and retail investors as the Fund
invests in securities of a diversified range of companies.
Also suitable for investors seeking Shariah compliant investment.
Investment Objective
The Fund is designed to provide investment results that closely correspond to the performance of the Benchmark Index, regardless of the Index’s performance
Investment Strategy
The Manager will seek to track the performance of the Benchmark Index by investing all, or substantially all, of the Fund’s assets in the constituents of the Benchmark Index in substantially the same weightings as they appear on the Benchmark Index.
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Information on MyETF-DJIM25 (3)
FUND INFORMATION
Asset Allocation Equity (Index Shares) : At least 90%Cash / Cash equivalents : Not more than 10%
Main Risks Market Volatility
Tracking Error
Liquidity
Trading Discount / Premium
Distribution Policy Cash distributions (if any) are to be made semi-annually
Annual Fees(charged to the Fund)
Management Fee: 0.40% Trustee Fee: 0.05% License Fee: 0.04% Other Fees: 0.05%
Total Fees 0.54%
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Information on MyETF-DJIM25 (4)
Top 10 Constituents of the Fund as at 28 February 2010
Please also refer to Fund Values page on our website www.myetf.com.my
STOCK CODE SHARES
4197 SIME DARBY BERHAD
1961 IOI CORPORATION BERHAD
6012 MAXIS BHD
3816 MISC BERHAD
4065 PPB GROUP BERHAD
2445 KUALA LUMPUR KEPONG BERHAD
6947 DIGI.COM BERHAD
5398 GAMUDA BHD
4863 TELEKOM MALAYSIA BERHAD
5052 PLUS EXPRESSWAYS BHD
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Sector* breakdown as at 28 February 2010
Information on MyETF-DJIM25 (5)
SECTOR NO. OF COUNTERS INDEX WEIGHT
PLANTATIONS 6 30.76%
TELECOMMUNICATIONS 3 20.14%
CONGLOMERATES 1 16.35%
TRANSPORTATION 3 10.87%
INFRASTRUCTURE 3 9.40%
OIL & GAS / ENERGY 5 7.79%
OTHERS 4 4.69%
TOTAL 25 100.00%
* Cash portion is not indicated as it is very small, <1%
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Information on MyETF-DJIM25 (6)
Trustee Deutsche Trustees Malaysia Berhad
Shariah Advisor CIMB Islamic Bank Berhad
Participating Dealers CIMB Investment Bank Berhad
OSK Investment Bank Berhad
Index Provider Dow Jones & Company, Inc.
� MyETF-DJIM25 is managed by i-VCAP Management Sdn. Bhd.
� i-VCAP is wholly owned by Valuecap Sdn. Bhd. which in turn is equally
owned by Khazanah Nasional Berhad, Permodalan Nasional Berhad & Kumpulan Wang Persaraan (Diperbadankan)
� The Fund is backed by other reputable players in the industry
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Shariah Features of MyETF-DJIM25
FUND INFORMATION
Screening of Securities • Dow Jones Shariah Advisory Board
• Securities Commission Shariah Advisory Council (“SAC”)
• Shariah Advisor of the Fund
Strategies to handle index shares not on SAC list
• Rebalance the portfolio among the remaining index shares; or
• Replace relevant index shares with non-index shares on SAC list that have high correlation with the substituted index shares; or
• Invest in cash or cash equivalents
Income Purification Process
• Separate non-Shariah compliant income from the Fund• Non-Shariah compliant income ratio provided by Index
Provider• Non-Shariah compliant income is distributed to charities
and/or utilised for educational programmes for the public, which are endorsed by the Shariah Advisor and approved by the Trustee
• Process is conducted semi-annually
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Performance Summary
Current Position
NAV : RM0.8231
Price : RM0.8250
Index : 752.30
Units in circulation : 791,500,000
As at 28 February 2010
FY2009 Performance
NAV : 40.95%
Price : 34.43%
Index : 39.46%
Performance Since Inception*
NAV : -17.69%
Price : -17.50%
Index : -21.98%
Tracking Error : 1.29%
* 21 January 2008
Price vs. NAV
0.50
0.60
0.70
0.80
0.90
1.00
1.10
J-08 M-08 M-08 A-08 M-08 J-08 J-08 A-08 S-08 O-08 N-08 D-08 J-09 F-09 M-09 A-09 M-09 J-09 J-09 A-09 S-09 O-09 N-09 D-09 J-10 F-10
Price NAV
Cumulative Performance: Fund NAV vs. Index
-50.00%
-40.00%
-30.00%
-20.00%
-10.00%
0.00%
J-
08
F-
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M-
08
A-
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M-
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J-
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J-
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A-
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S-
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O-
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N-
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D-
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J-
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F-
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M-
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A-
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M-
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J-
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J-
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A-
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S-
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O-
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N-
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D-
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Cumul. NAV Change Cumul. Index Change
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MyETF-DJIM25 vs. Stocks (1)
� Features
MyETF-DJIM25 Single Stock
Management Style
Passive Active & Passive
Diversification Yes No
Real-time dissemination
Yes (Trading Hours) Yes (Trading Hours)
Trade via Broker Broker
Purchase / Settlement
T+3 T+3
Minimum
Investment
100 units based on
market price
100 shares based on
market price
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MyETF-DJIM25 vs. Stocks (2)
MyETF-DJIM25 25 Stocks
Transaction Charges (RM)
Gross Cost^ 82.50 Brokerage Charges� 0.58
Clearing Fee* 10.00 Stamp Duty� 1.00
Transaction Charges (RM)
Gross Cost^ 16,762.00 Brokerage Charges� 117.35
Clearing Fee* 250.00 Stamp Duty� 31.00
TOTAL COST RM94.08
TOTAL COST RM17,160.35
^ Based on 1 board lot (100 shares) x Market Price as at 25 Feb 2010 �Assumed maximum brokerage charge of 0.70% per contract value * Clearing fee of 0.03% of transaction value, maximum of RM1,000.00 and a minimum of RM10.00 per contract. �Stamp duty of RM1.00 for RM1,000.00 or fractional part of value of securities, maximum RM200 per contract.
� Investment in MyETF-DJIM25 provides cost-effective portfolio diversification to investors
� Cost of Portfolio Diversification (Illustration only)
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MyETF-DJIM25 vs. Unit Trust Fund
� Features
MyETF-DJIM25 Unit Trust Fund
Management Style
Passive Active & Passive
Diversification Yes Yes
Real-time dissemination
Yes (Trading Hours) No (After 5pm)
Trade via Broker Agent
Purchase / Settlement
T+3 Immediate
Minimum Investment
100 units based on
market price RM200-RM1000*
*Typical minimum size for actively managed equity fund
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MyETF-DJIM25 vs. Unit Trust Fund (3 years)
� Return On Investment (3 years) as at 25 Feb 2010 (Illustration only)
MyETF-DJIM25 UTF
Gross Return (%) 6.51%* 6.89%#
Transaction Charges^ 0.90% 5.00%
* Gross Return for MyETF-DJIM25 is based on 3-year performance of its Benchmark Index (DJIM25 Index), less theFund’s expense ratio of 0.54% p.a.
# Gross Return for UTF is based on actual performance of median Shariah equity fund in the Edge Lipper Table (out of 35 funds)
^ Transaction charges for MyETF-DJIM25 comprise brokerage commission, clearing fee and stamp dutyTransaction charges for UTF include sales charge or upfront fee
Sources: Bloomberg and Edge Lipper Table, Syariah Equity Malaysia Sector
� In this illustration the gross return for Unit Trust Fund is higher but factoring in the equally high transaction charges (sales charge) may significantly reduce investors’ net return on investment.
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� Primary Market
� Participating Dealers
� Investors may participate via the creation of new units through the appointed participating dealers at NAV (in multiples of 500k units)
� Secondary Market
� Listed on Bursa Securities Main Market
� Similar to trading in stocks/shares
� Investor only needs a Central Depository System (CDS) Account and a Trading Account with a broker
� Market price changes throughout the day
How and Where to Invest in MyETF-DJIM25 (1)
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How and Where to Invest in MyETF-DJIM25 (2)
TRADING INFORMATION
Listing Main Market of Bursa Malaysia Securities
Stock Short Name / Number MYETFDJ / 0821EA
Bloomberg / Reuters Code DJIM25 MK / DJMT.KL
Board Lots 100 units
Transaction Charges Commissions depend on brokers (subject to a maximum of 0.70% of the contract value)
Clearing fee & stamp duty, as determined by Bursa Securities
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� Investment in MyETF-DJIM25
�MyETF-DJIM25 Information
� From Brokers
� From Participating Dealers
� From Fund website: www.myetf.com.my
� From Bursa Malaysia website: www.bursamalaysia.com
How and Where to Invest in MyETF-DJIM25 (3)
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� Convenient and cost efficient portfolio diversification through a single transaction
� Fund’s transparency where the component stocks and prices are readily available during trading hours on the exchange
� Effective risk management strategy in current volatile markets –maintain presence in equities without direct exposure to single stock
� Simultaneous exposure to leading Shariah-compliant equitieslisted on Bursa Malaysia
� Lower management fee compared to actively managed unit trust funds which do not necessarily provide higher returns
� Lower transaction charges compared to most equity unit trust funds
� Largest Shariah ETF in the world & 1st Shariah ETF listed in Asia
� Managed by i-VCAP and supported by reputable partners
Why MyETF-DJIM25
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The Fund is intended to be made available only in Malaysia. We recommend that you read and understand the contents of the Prospectus for MyETF-DJIM25 that has been registered with the Securities Commission, who takes no responsibility for its contents, before investing. You may view the Prospectus at the Fund’s website or obtain a printed copy of the Prospectus from i-VCAP Management Sdn. Bhd.’s office. Please consider the fees, charges and risks involved prior to investing. The unit price and incomedistribution, if any, may rise or fall. Past performance of a fund is not indicative of future performance. You are advised to seek independent advice and/or consult relevant laws, regulations andrules prior to investing.
Disclaimer
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Thank You
i-VCAP Management Sdn. Bhd.Level 9, Block B, HP Towers
No. 12 Jalan Gelenggang
Bukit Damansara
50490 Kuala Lumpur
Malaysia
Tel: +603 2093 7119
Fax: +603 2094 7119
www.myetf.com.my