Anyhow Investments by parents
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Hi people
Some banking people has persuaded my mum to buy some products and she signed the transactions. Best part is tat she kept it away from me.
Now that there are banks and investment institutions collapsing, she sure is worried, and suddenly surrendered everything n show me.
I am trained in software engineering, not finance reporting. So what ever she bought, I have no idea wat they are.
Anyway any kind souls can help me with the following products:
Allianz Global High Payout FD
Schroder Asian Bond
DBS Vitamin Account
OCBC 3.5 years SGD FX-Linked Structured Deposit.Any kind soul can explain them to me? Really need to settle for her as she keeps bothering me about them. Worried that they are linked to lehmans and such.
Thanks
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The first 2 looks like unit trusts to me. The other 2 are structured deposits with our local banks, as the name suggests.
All you need to do now is to look for the agent, bank manager, financial adviser or underwriter whom your mum signed the products with. Their contact details will be found on their respective prospectus.
Just give them a ring to allay your fears since your primary worry is whether their linked to Lehman. Heck, thats what you guys are paying them for anyway.
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OCBC 3.5 years SGD FX-Linked Structured Deposit (100% principal protected by OCBC Bank if held to Maturity Date.)
DBS Vitamin Account (1 Vitamin Account is a 6-year equity-linked structured deposit. The Bank will return you 100% of your principal amount if you maintain Vitamin Account till maturity or upon early redemption by the Bank. Meanwhile, you should ensure that you have sufficient liquid assets during the 6-year investment period. Early withdrawal by you may result in you receiving substantially less than the principal amount invested.
2 From Year 2 onwards, when the potential payout rate for the year is 3% or more, the Bank will redeem your investment early. You will receive 5% bonus payout and your full principal amount. There will be no other potential payout.)Schroder Asian Bond (bonds are low returns investments, risk occurs when the bond issuer defaults payment. they are not involved in US company bonds.)
Allianz Global High Payout FD (global equities)
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Not only your parents.
Last year I went to a bank with $11,000 to open an e-account. I was ushered to a fund manager, who talked me into putting $10,000 into unit trust, that was supposed to grow at 8 -9% pa. It is now worth only $4,800, shrink more than 50%. Sigh!!
Now when I go to a bank, I tell myself, go for the intended purpose, nothing else, and get out.
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Originally posted by shrekho:
Allianz Global High Payout FD
Schroder Asian Bond
DBS Vitamin Account
OCBC 3.5 years SGD FX-Linked Structured Deposit.Allianz Global High Payout is a unit trust. It is not principal protected. And over the past couple of months, it hasn't been doing very well.
Schroder Asian Bond is also a unit trust. It is doing ok, BUT the value of the fund is dropping. However it has been giving payouts equivalent to about 4% of investment per year.
DBS Vitamin Account is a structured deposit. Structured deposits are 100% principal protected if held to maturity. So wost case scenario is your mum doesnt get any interest over the tenure but will still get her principal amount back. One thing not many people know is that if the bank collapses, structured deposits are not insured by the SDIC (government). The latest ruling by MAS (100% guarantee on all deposits) does not change this fact.
OCBC 3.5 years SGD FX-Linked Structured Deposit - if im not mistaken, this particular structured deposit is quite new = last 3 months. There is a fixed component ( fixed interest payout) to it and it is also 100% principal protected when held to maturity. The same rules apply as per DBS Vitamin Account.
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one more thing, one thing i don't like abt structured deposits are that they lock u in for a certain tenure. For e.g. OCBC's 3.5 yr FX Linked structured deposit locks u in for 3.5 years. NOTE : there are very high early redemption charges ( early withdrawal charges) !!
so structured deposits are good for people who know that they wont need this $$$ for a extended period of time.
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one last thing, in my experience, it's quite common for people to keep financial issues away from their family. I have seen children not wanting their parents to know how much they have, parents who hide their total holdings from children, even wives who hide $$$ away from husbands ...
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Originally posted by maxtor:
Allianz Global High Payout is a unit trust. It is not principal protected. And over the past couple of months, it hasn't been doing very well.
Schroder Asian Bond is also a unit trust. It is doing ok, BUT the value of the fund is dropping. However it has been giving payouts equivalent to about 4% of investment per year.
DBS Vitamin Account is a structured deposit. Structured deposits are 100% principal protected if held to maturity. So wost case scenario is your mum doesnt get any interest over the tenure but will still get her principal amount back. One thing not many people know is that if the bank collapses, structured deposits are not insured by the SDIC (government). The latest ruling by MAS (100% guarantee on all deposits) does not change this fact.
OCBC 3.5 years SGD FX-Linked Structured Deposit - if im not mistaken, this particular structured deposit is quite new = last 3 months. There is a fixed component ( fixed interest payout) to it and it is also 100% principal protected when held to maturity. The same rules apply as per DBS Vitamin Account.
I have no issues with what they want to invest, but I am damn mad and pissed that they don't listen to advice or just jump into any investments without considering the fact that they will ask their offsprings for help later on.
They like to invest, and maybe hao lian to their relatives/friends later on. If lose money then keep quiet.
Anyway I will be monitoring the 2 funds for now. Have to see how they perform and advice my mum later.
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If I am not mistaken, the most prudent thing to do when you are 50 years and above or retired is to keep your money in FDs.
Buying unit trusts and investing/speculating in the stock markets should be done when you are younger at 20-50 years old when time is on your side.
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Originally posted by shrekho:
Anyway I will be monitoring the 2 funds for now. Have to see how they perform and advice my mum later.
may i propose that you recommend to your mum to cut her losses and forget about this for now. depending on what you think, the market may dip even lower and her holdings would be further diminished.
I give u an example. In 2000-2002 when the dotcom bubble burst, the NASDAQ Composite Index when from 5000+ in 2002/03 to 2000+ last month, and is currently standing at 1000plus. What Im saying is that if you hope for a recovery, it may not happen, but then again, that's your prerogative.
hope i've been of help.
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do a search online and read the documents provided or call the bank on your mother's behalf.
you dont need to be an investment guru to understand the basics.
help your mother since you know she is worried and at a loss.
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Originally posted by maxtor:
may i propose that you recommend to your mum to cut her losses and forget about this for now. depending on what you think, the market may dip even lower and her holdings would be further diminished.
I give u an example. In 2000-2002 when the dotcom bubble burst, the NASDAQ Composite Index when from 5000+ in 2002/03 to 2000+ last month, and is currently standing at 1000plus. What Im saying is that if you hope for a recovery, it may not happen, but then again, that's your prerogative.
hope i've been of help.
You are right on the Nasdaq.
If you were a long term investor on some of the dotcom companies then, it is likely you might not get to see those prices again for a long time.