Wednesday, April 28, 2010

Why Malaysians should consider investing overseas...

Many Malaysians who have been investing for the past 10+ to 20 years would have concurred with me that although the Bursa is a little bit undervalued, we could not find much excitement here. Why?
These are the reasons why:
- Malaysian stock exchange has deteriorated from being the 4th largest in Asia (ex- Japan) in 1997 to god knows what position we are now - are we now smaller than Jakarta? - or perhaps we definitely are less exciting than the Jakarta Stock Exchange;
- Bursa is now more like a training trading ground for EPF's and PNB's fund managers;
- let me give you a question - if you are a Malaysian who would like to put your extra money, what are the chances of you putting your money in the stock market as compared to properties;
- investors (although they may not be shorter term speculators) would prefer higher volatility - Malaysian market volatile? Nehhh!;
- the last 10 years with Internet, we now have more opportunities to invest anywhere in the world especially in the more developed exhanges - for example why do we want to put our money in KFC (in Bursa) whereas we can put our money in the company that gives the license to operate for KFC Malaysia i.e. Yum! Brand in the NYSE?;
- my friends say try putting your money in UMW - I say lets be more exploratory by putting our money in the company that gives the distributorship to UMW i.e. Toyota;
- what is Malaysia exciting for? Palm? Oil and Gas? hmmmmmm...perhaps only palm oil stocks - even then would you want to put your money in Sime Darby when your EPF money has already invested there?
- opportunity to not overly exposed by holding too much Ringgit - we already hold our pension money, properties etc in Ringgit. In a globalize world, why should we be exposed to just Ringgit?
Any other reasons?

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