Malaysians have more choices for investment than ever before. It’s driven by innovation in the capital markets and FinTech players. A supportive government, robust economy, educated workforce, and developed infrastructure are factors that transform the Asia-Pacific country into an attractive investment destination for international investors.
If you decide to invest in Malaysia, you might wonder about your selected investment assets’ return of investment (ROI). Used as an investment’s performance and efficiency measure, ROI is represented as a percentage of profit. An amount of capital yields the percentage after costs and expenses over a certain period. To understand the return on investments of selected investment assets, let’s check out the article below!
A unit trust is a flexible, long-term investment that provides a good foundation for individual investors to fulfil their financial aspirations. But, before choosing this selected investment asset, it’s essential to have sufficient knowledge. Investing in unit trusts with misconceptions often results in unnecessary disappointments when investors’ expectations are not met.
In Malaysia, the Securities Commission Malaysia takes care of the regulation, while professional fund managers will manage the investment. The ROI ranges depending on the average stock market results and fund objectives. Professional fund managers will make investment decisions to help achieve specific goals, like growing your capital. Malaysian unit trusts are flexible and can be bought as a lump sum, regular savings, or through EPF savings.
Debt investment is an investment made in a firm or project by purchasing a large quantity of debt. This type of investment counts as current assets (any asset that will provide an economic benefit for or within one year) for accounting purposes. You can make this investment with the expectation of being paid back plus interest. Some debt investments include peer-to-peer lending, real estate investments and municipal bonds, among other options.
You can invest in bonds in Malaysia by buying and selling individual bonds through a brokerage account. There’s also an option to invest in bonds through bond funds (a type of unit trust which is an excellent way to invest in a few different bonds with limited funds). The potential return of this selected investment asset is around 10%, which is considered a good ROI.
Real Estate Investment Trusts (REITs)
REITs, in simple terms, are shares of commercial properties listed on the Bursa Malaysia stock exchange. It is owned and managed by property developers or professionals. There are several properties under this income-generating real estate, such as shopping malls, factories, hospitals, warehouses, offices, and farms. This investment asset is appealing because the yield for REITs is usually higher than other listed companies. It is an ideal vehicle for passive income with ROI ranging between 4-8% every year in addition to potential capital gains.
A blue-chip is shares of typically large and well-recognized companies with an excellent reputation that have operated for many years and have dependable earnings. If you are looking for safe investment options in Malaysia, you can consider blue-chip stocks because this investment can endure economic downturns and give high returns in good market conditions. The growth potential is slow but moderate, as you can expect the ROI to depend on the market and companies you’re invested in.
Equity crowdfunding (ECF) is an alternative fundraising method that allows startups and small businesses to raise funds from the general public (retail investors). In Malaysia, this unique way to raise capital for business without taking on new debt is using online platforms registered with the regulators. This form of fundraising attempts to attract investors willing to contribute funds toward business goals in return for a financial stake in the company. ECF allows investors to own a proportionate slice of equity in the business with an ROI that depends on the campaign.
Investment is a rational activity that requires constant education. Understand your risk appetite and consider your financial goals to find the best investment asset that fits you. Good luck!