07 Jun 2019
Hello guys! What do you think of unit trust as investment? I've also been told by wary relatives to never do ILP (investment and insurance should be kept as two separate things). Let's keep it a beginner level discussion, coz most articles I find online are super long-winded.
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07 Jun 2019
Co-founder at Seedly
Jonathan Chia Guangrong
25 Oct 2018
Cybersecurity Trainee at Bank in blue
One word: avoid. No guarantee that the unit trust price will go up and continue to go up. And fees are payable even in years of negative returns. ILPs are basically insurance contracts structured around unit trusts, only with more fees involved on top of the management fees. Would rather manage my own portfolio where I can make money in any market condition
25 Oct 2018
Founder and Director at CFX Money Maverick Pte Ltd
If you want a beginner level analysis - an ILP is just the wrapper held by an insurance company for ...
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Hey! Let me explain to you to the best of my ability: Before that, I will define what Unit Trusts are. For more info you can read here: https://blog.seedly.sg/diy-vs-active-unit-trust...
What are Unit Trusts:
These are an actively managed investment funds which are not traded on a stock market. It’s usually higher cost due to the nature of the way that a fund is managed… In this case, as seen above, like a team of analysts running behind the scenes looking to try and beat the market.
Examples include:__ First State Dividend Advantage Fund, East Spring Fund Franklin Templeton Bond Fund
What are ILPs:
This is one of the many ways to buy a Unit Trust. So basically if you see above, I have shared the DIY approach to buying a Unit Trust via one of the platforms described (FSM, POEMS etc). However, with ILP (Investment Linked Policies) they are more like Insurance first with investment components inside as well.
ILPs have a wide range of funds (unit trusts) for the policyholder to choose from. Some of these funds require a high initial capital to invest.
However, this is the main con - Allocation rate: The full amount of your premium will not be used to buy into investment units for your early years. This method of front-end loading ensures that distribution and administration cost is incurred on the policyholder during the early years of his policy. Read more about what ILPs are and why you should consider strongly before committing to a ILP in Singapore: https://blog.seedly.sg/investment-linked-policy...