Amanah Saham 1 Malaysia's declared lower -than - expected dividend

When I received the news of the declared dividend on 23 Sept 2010, I was relaxing on the Royal Caribbean Cruise to Venice from the Greek's island of Corfu. I decided to check on my email from the ship's 24-hr online center after a hectic stop at our last port of call. I was a little disappointed at the declared rate of 6.38% as I had expected it to be 7.0%. But if you look at the other declared dividends of PNB unit trusts like ASM, ASW and ASD  at 6.35 you would notice that AS1M's is just a wee bit higher by 0.03!

It does look like PNB is no longer able to give "special" dividends like it used to give to its  latest products like on previous occasions such as ASM (amanah saham Malaysia) and ASW ( amanah saham wawasan) prior to 2008. The SIME Darby's debacle publicized early this year could have contributed to this lower than expected declared dividend coupled with the prevailing global financial uncertainties.

At its height in January 2010, SIME stock was trading at 9.11 and it tumbled precipitously down to 7.20 at one stage due to investors' crisis of confidence following the news of the company's billion dollar loss. It didn't recover till late August following the new CEO's restructuring announcement. PNB's interest in SIME is quite substantial. So you do face risk even in unit trusts such as this, the only comforting fact is that your capital is protected unlike the variably-priced mutual funds.

But folks, ASIM's dividend is still the highest declared by PNB so far this year. And as I was hoping for that "whopping" dividend, I was encouraged to add more money  progressively into the fund as a result I received more than the amount had I otherwise stopped at my initial investment in September 2009 when the fund was first launched by the PM.

Look at this way, AS1M is just one of the PNB's stable of financial products that gives you an opportunity to earn more than your savings in the banks. Due to my bad experience with mutual funds, I would still put some of my investing money in PNB's unit trusts. Moreover the varying period of dividends' declaration of the respective trusts ensures a steady  income throughout the year.

Personally I would have made more money from my investment in AS1M had I not reduced it by buying a technology stock (JCY) 10 days before it tumbled pathetically! Some times it is hard to reign in your risk appetite.

Welcome then to the exciting world of wealth creation.