EPF: More into private equity, property and infrastructure

Diversification is key to long term returns and safety. Sometimes, this may not provide the best returns but as they say, never put all your eggs into one basket. For investment, I love property the most, maybe because I could actually touch, see, feel and enjoy it. However, I am not convinced to only have properties. Thus, stocks and unit trusts are the other two of my investment pillars. Between all three, I think the lowest returns thus far which is in single digits per year would be unit trusts. Stocks would vary tremendously. One good stock may give us returns so good that even if others merely provide dividends, it is good enough. Tips? Here: Good notes for stock investing from an investment guru
When we have lots of funds, we tend to have more options. Of course, it also meant that it’s harder to ensure everything we invest in would give high returns. Perhaps some would give exceptional returns but there would also be some that we may have to hold for a while, especially during downturn cycles. Reported in NST dated 7th Oct 2016, the CEO of our Employees Provident Fund (EPF) said, “For a long-term investor, you sometimes have to be counter-cyclical, that’s what we tend to be. Typically, when markets suffer major corrections, we come in and buy heavily.” I think this view is by far better than to wait for the best time to buy which usually means nothing because no one would be able to predict with accuracy when’s the actual best date to buy.
EPF is also planning to diversify its investment portfolios. The three key areas where it will increase its investment include private equity, property and infrastructure. He shared EPF’s experience. “From our last six to seven years of experience looking at these assets, we’re now fairly convinced that they are viable asset classes, which will help us to meet our inflation-hedging targets.” It is also on the lookout for property assets in the United Kingdom. It currently has a UK property portfolio worth more than £2 billion (RM10.7 billion). On a personal note, even if many Malaysians prefer Melbourne or Sydney properties, I personally would prefer London. Only one tiny issue, I have no funds to buy in any of the three cities today or even in the near future. Happy investing.
written on 7th Oct 2016
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