Did you read the story about EPF contributors losing their shirt in unit trush schemes? It says "...80% of EPF contributors who invested their savings in unit trusts posted losses totalling RM600 million". Wow!
What happened? How can so called professionals with degrees and certifications lose? The answer is they are just human. Human makes mistakes. So are they. And not all of them are good. Maybe 5% of the funds are good but the rest are rubbish that only knows how to fatten their own purse.
The first question to ask is: Is it worth the risk paying them to earn an extra few percent return above EPF return?
In my honest opinion, it depends on how good are they. If they can return 20% yearly, I would say it is worth the risk. If the return is less than 10%, then I think it is safer putting your money in EPF than letting them handling it. If they can give you that return in a good market, imagine what will they give you in a bad one.
The next question is how do you know they are good? Well look for information about their pass performance. They ask about who are the fund managers. Always keep track of this important person. This is not easy as you will only know this when you get your quarterly interim report.
The next thing to do is never trust the person trying to sell you any trust fund products. They are just sales person whose income depends on sales. Maybe only a few are honest. It is better deal with a person that is independent from any funds as his opinion will not be bias.
Investing is not easy if you are the lazy type that just wants to put your money in and forget about it for the rest of the year. You need to be active and pay attention to your portfolio. In other words, you still need to do your home work.
