MAA Insurance Financial PLANNERS

MAA Financial PLANNERS was incorporated in May 1997. Since then, it has grown into a dynamic organisation led by founder Mr M Amin. It is now supported by 40 professional Independent Financial Adviser Reps and two Directors. Under the Monetary Authority of Singapore's (MAS) new ruling towards promoting Financial Advisers (FAs), MAA was among the first few to be given the license to operate as a Independent Financial Planning firm.

After 45 year in Life Insurance business... Now into our 10th year of excellence in Independent Financial Planning services.

Independent Financial firms are increasingly recognised as a distribution channel by Financial institutions to market their Investment Products (Unit-trust), Life Insurance, General Insurance and Housing Loan and other referral services. Our unique role allow us to offer our clients a broad range of products with the relationship we have consolidated with our Partners. With the liberalisation of the Financial service industry, we look forward to expand to expand our partnerships with both local and foreign financial institution in Singapore in order to enhance our current range of financial products to suit your every need.

Recently, we expand our partnership to TransAmerica, an american-based insurer to offer their products to our high-net worth clients.

Winners of many Awards! MAA has been a Leaders in this field. An experience gather since 1997, our "Independent-Operation" have accepted by our clients as it inevitablely mould our Advisers to give comprehensive and "unbiased" advice to our client. Check out our vast Portfolio for details on what we can do for our clients.

Why Should You Plan Through MAA Independent Financial Adviser?

A world of difference by engaging a MAA IFA Rep:

	- No extra charges
	- No tedious comparisons of different Asset Mgmt, Life & General companies' policies
	- Investments - ILP or Unit-Trust? Both are available to you
	- Most importantly, Wider choices
	-A IFA Rep represents a client's interest while a tied-agent represents his company only. Who will gives you a better option?

Asset Allocation

One of the most important investment decisions you can make is not what particular stocks or securities you buy but how you allocate your investable funds to the various asset classes.

The principal is based on how you can use it as an investment strategy. It consist of many ideas. Some common one are (1) Risk and Return (2) Diversification (3) Time Horizon (4) Various Asset classes.

Asset Allocation is a method of deciding what percentage (%) of your available investable fund should be invested in cash, bonds and shares. Most common mistake among people is that they invest in familiar asset while ignore the others i.e. they do not diversify their financial assets sufficiently. Studies have shown that what really makes a difference to a portfolio's return and risk is not which shares or bond were chosen but how much was invested in shares and how much in bonds. That is to say, the asset allocation decision is the main deciding factor determining a portfolio's return and risk and can be much more important than the selection of individual securities.

Generally you can follow 5 steps in doing your asset allocation. They are:

Step 1. Decides on your investment Goals in areas of capital preservation, capital growth, income or liquidity. Then consider their importance.

Step 2. Decides on your Investment time horizon. It is connected to your investment goal. This time horizon is to define the time you need your fund back like an education fund for children, savings for retirement and other time for your financial need. With the "time" that you need the funds, you then can do-up the appropriate allocation putting a certain percentage of your fund to shares and bonds. With more time, you can go into higher risk asset.

Step 3. Consider your risk tolerance. That is to say, how much can you see the value of your investment fluctuate or prepared for the possibility of losses. Risk Tolerance is subjective and it varies from one individual to another.

Step 4. Decides a suitable asset mix which you are comfortable after considering the Risk and Return of each asset class. Also you must determine how they are correlated to each other.

Step 5. When invest in asset abroad, you must also consider the currencies fluctuate

You need to consider these 5 steps to arrive at an asset allocation that address your investment objectives and risk tolerance. An asset allocation suitable for one investor may not be suitable to another like-

Example : An investor's age is often the natural starting point in developing asset allocation guidelines. Investors in their 20s can afford more risk and thus can hold high percentage of stocks and smaller percentage of bonds and cash. While an investor in 50s tend to be more risk averse as they are approaching retirement and they now hold a higher percentage of bonds and cash than stocks.

After deciding your asset allocation, like all plans, you need to periodically review as financial circumstances will change. For example, you may make career-switch. Even if there is no change in your personal position, the market are likely to. Thus you must decides whether to keep to your existing allocations or rebalance them.

In conclusion, asset allocation is one of the most important investment decision. To do it well, you need to get assistance with your Independent financial adviser and then define your investment goals, time horizon and risk tolerance. The asset mix will have a diversified portfolio that address your investment goal and which can weather different market conditions.

Areas of Consideration in Investing in Unit-Trusts

Unit Trust offer significant benefits, but you should also be aware of the following considerations.

You can be overwhelmed by the availability of funds offer to you. If you invest indiscriminately, you could end up with an assortment of unit trusts that do not match your needs. Thus, you must be clear about your investment objectives and then decide on the suitable unit trust.

The fees you pay for investing in unit trusts can eat significantly into your returns. These fees may also includes high transaction costs so investors should be aware. You should inquire about the type and amount of fees applicable to a particular unit trust. You Independent financial advisers (IFA) will be ready to provide you the service in getting the information to you..

The selection of the fund manager is another important consideration. You will need to assess whether has the resources, experience and skills to do a good job of managing the fund. Once the investment is made you still need to monitor the performance to see if it is meeting your expectations.

Good recent performance of a unit trust may attract you to invest in it. This may not be advisable however since it is difficult to judge consistency over a short period. Consistent good performance over a longer period is a better guide to the quality of the fund manager, but even then it must be noted that past performance is not necessarily a good indicator of future performance.

Evaluating Unit-Trust Performance

There are three main ways of evaluating the performance of your unit trust. one is by looking at Absolute returns, taking into account both the income received and price change. You can obtain information on total returns on total returns from the manager of the fund or 3rd party analyst views.

Normally, these returns are annualised so that you can examine performance over a stipulated time frame and also to enable you to compare performance of one fund relative to another. However, absolute return is not sufficient measure of a fund's performance.

The second way is o judge a Unit Trust's relative performance by comparing it against its benchmark index. The difference, called excess return, is calculated by subtracting the benchmark against which its performance is measured. For example, the typical benchmark for unit trust investing in Singapore stocks is the Straits Times Index. If the excess return is positive, the unit trust is said to have outperformed its benchmark. If it is negative, the unit trust has under performed.

The benchmark index represent how the entire market performed on average. Comparing a unit trust's performance against its benchmark is a more useful measure of the skill of the fund manager. Other than passive or index funds which replicate the entire benchmark index, a fund should be expected over a reasonable time horizon to outperform its benchmark.

Two (2) unit trust can have the same excess return over the same time horizon, yet performance may not be equal, as risk has not been taken into account. The third method therefore is to measure the performance of the unit trust relative to the risk taken. One widely used statistic is the performance ratio which measures the excess return per unit of risk taken, with the latter measured by the volatility of the excess returns. If the information ratio is positive, it indicates the presence of some skill in the fund manager. A negative information ratio indicates that the fund manager has under performed the benchmark return.

Types of Unit-Trusts

Unit Trust can be divided into several categories depending on their investment objectives and focus. Primarily they are divided into 3 categories:

[1]. Shares
[2]. Bonds
[3]. Balanced Fund that combined shares & bonds

Some funds are invested in a single country, some in specific regions (eg. Asia, Europe) and some even globally. There are funds that focus on specific sector or industries such as Technology, Healthcare and Property.

In recent year, capital guaranteed or capital protected funds have become very popular. It is also possible to invest in funds that Invest "passively". Such funds invest in the component stocks of a market index and thus require no skill or judgment on stock selection. Given the large number of possible choices, it is important that you select those that meet your Investment objectives and Risk tolerance.

If you invest in unit-trust, you have to pay various fees There are fee that are one-off and mainly paid to the distributor of the fund. These are paid when unit are purchase ("front-end" fee) and, sometimes, when units are sold (redemption fee). These fee are also called "load" and can be as high as 5% of your initial investment in a unit trust.

In addition there are those fees that are recurrent in nature - the management fee paid to the investment manager for managing the fund. This is usually around 1% to 1.5% of net asset value (NAV). Other fees include the trustee fee, registry fees, valuation fee and audit. Together these fees make up what is called the total expense ratio (TER).

If your unit-trust fund is linked to an insurance plan known as Investment Linked Plan (ILP), you may need to pay the extra cost like mortality which can increase with each passing year, policy-fee, insurer management fee and other cost as stated in your policy document.

For your unit trust to grow in value it must generate sufficient income or capital growth to all these costs. Investors should find out a fund's cost before deciding in it.

What & Why Invest in Unit-Trust?

There are many investment instruments available for you to invest. You are encourage to place your money into various asset classes accordingly to your Risk factor.

Unit-Trusts are a practical alternative form of investment. You may have already invested with your insurance agent or Bank planner with your CPF or cash savings. A unit-trust pools money from many investors which is then invested in a variety of asset in order to meet specific investment objectives. the pool is managed by a team of full time professionals and a trustee is appointed to protect the interest of the investor.

You invest in a unit-trust by buying units in the trust. The price of each unit is determined in relation to the trust's net asset value (NAV). This is the market value of the trust's net asset that is make from the Investments, cash and other assets minus expenses, payables and other liabilities, divided by the number of units outstanding.

The NAV is usually computed daily to reflect changes in the prices of the Investments held by the fund.

Unit-Trust offer several advantages. First, you can select a fund or a combination of funds to cater to your specific investment Goals and Tolerance for Risk. If, you are nearing a retirement and have low tolerance for risk, you can invest in unit-trust like Bond fund or Balanced fund. On other hand, there are unit trust that are suitable for investors looking for higher potential returns and willing to accept higher risks.

Second, unit trust allow you to invest into a diversified portfolio with a minimum investment of as a little as $1,000. Also a unit-trust with $40 million in asset can hold hundreds of different shares and can also negotiate lower transaction costs such as brokerage changes.

Third, Unit Trust allow you to invest in Securities that you may be unable to access as an individual investor. These securities includes bond that usually required a minimum investment of $100.000. It may also be difficult for you to invest directly in overseas stocks whereas you can conveniently invest in a unit trust investing in international stock markets.

Fourth, fund invested in unit trust are managed by professional fund managers and analysts. You can therefore benefits from their expertise and full time attention to investing the funds.

Lastly, buying and redeeming unit trust is simple and easy. Most unit-trust allow daily buying and selling of units. You can get updated values of the price of your unit trust from the daily newspaper and your servicing Financial Adviser.

MAA Investment

Many people realise the importance of saving but have reservations about investing. Investing is often regarded as "gambling"; "too risky"; "only for the rich";"only for those about to retire"; too complicated"; "not necessary". While misleading, such reservation also deter us from investing. We then forgo the opportunity of growing our savings. If you are in this situation, we will address some of your concerns and questions you may have about investing.

Knowing Return and Risk
Return and Risk are Primary consideration in Investing. They should likely form the basic for all your investment decision. Thus it is a MUST that you understand what return and risk are and how they are originate and they are related.

Return
You invest to get return. It simply get Gain (positive return) or lost (negative return) on your investment after you have sold it. When you invest, you expect a particular return level . However, the actual return may differ from your expected return. Investing is based on expected return. It is therefore that you do not have unrealistic expectations

Risk
Many think of investment risk as the possibility of losing money. This is a valid concern. Other define risk as the uncertainty of receiving the expected returns. All can these can be measured and quantified by a statistic. Different investment products have different degrees of risk or volatility. Look at the various product like shares, bonds and cash deposit on their annualised return and Risk.They can be classified into two categories:-
(1) Systematic Risk -factors that effect the market in general and it include things like general economic conditions, changes in interest rate or a sudden adverse change in market conditions. And as investor, you cannot avoid these risk
(2) Non-Systematic Risk-factors that are applicable only to the investment itself like quality of a company's management and the sustainability of its product development strategy.You can reduce this risk by spreading your investments over a number of holdings.

Thus, the risk-return trade-off is an important consideration in investment - Higher expected returns have higher risks. Investors not able to take risk have to contend with lower returns. You need to apply the Risk-Return trade off when purchasing the product.
When deciding on the appropriate level of risk, you need to consider two issues. Firstly, what is your tolerance level of risk and secondly, is the length of time you are investing for.

"Don't put all your eggs in one basket", is the basic idea behind Diversification and it is a powerful tool in managing risk. Diversification involves spreading your investments over a variety of assets and securities to avoid excessive exposure to any single source of risk. If you put all your money in a single security, what happen if the insurer goes bankrupt?

To diversify effectively, you must apply the ideas of Correlation, which is a measure of the tendency of a security or investment class to follow that of another. Assets with returns that move in the same direction are positively correlated; if their returns move in opposite directions, they are negatively correlated. Investing in different securities in different asset classes like cash, bonds and shares is a way to go.

When you invest, you operate with a Time horizon in mind. It is the time available to invest to achieve your financial goals. Example, if you are 40 years old and investing for retirement at age 60, then your time horizon is 20 years. Therefore, you can use Time and Return to grow your money or Time and Risk to stomach more risk with time to invest in Riskier assets.

Dollar cost averaging can reduce risk in a long Investment horizon. The idea is to invest a fixed sum of money at a regular interval, regardless of whether the market is rising or falling. If you invest in only a certain time, you may buy when prices are at or near the peak.

Life Stages Planning

At MAA, you always come first.
We will help you build your financial home as you go through the various life stages . Your personal requirements determine the planning strategy on which the management of your financial needs is based. With this in mind, there are several key principles we use as a guide to the Financial services we provide.

Your Economic Value
We know you've worked long and hard to acquire your assets. You can be confident we will do everything possible to protect your economic value and grow the wealth you have accumulated.

The Planning Strategy Starts With You
Your attitude towards Financial Planning -the type of portfolio you are seeking, the rate of return you wish to achieve and the degree of risk you are prepared to accept - will depend upon your personal circumstances. We employ immeasurable time and effort in building a long-term planning strategy suitable for your needs. Primarily, your life protection-needs take precedence.

We'll Be There For You
Our unique roles have guided many clients through their ever changing needs. Working on your behalf are some of the multi-talented Financial Adviser Representatives committed to provide you with timely information and advice.

It's A Long- Term Relationship
Over time, your needs will change, markets will change and factors determining protection and investment success will change. We will work with you to help you meet your long-term goals. With a Disciplined Approach comes Disciplined Results. Our discipline entails understanding your planning goals, building a plan and staying on course. We assist you to set pragmatic, measurable objectives and work with you continuously to achieve them.

Our planning approach will give you the confidence to act in your own best long-term interests, as opposed to merely reacting to an ever changing short-term environment. Diversification is a necessary tool in effective Risk Management. A truly guaranteed planning does not exist, since no one can predict the future of any planning with absolute certainty. Risk can be managed but not entirely eliminated. Experience has shown diversification to be the prudent risk management approach to protect your financial assets.

Protection Is Only One Part…. The other is Investment - This Completes Your Life Picture
Our discussion in Financial planning usually lead to other related financial and lifestyle topics. A current will, Estate planning, the need for investment planning, together with the incorporation of fundamental tax and legal advice, all play a strategic role in a successful Financial Planning strategy. MAA recognizes the best results for you –“the Client”, this will be achieved when we work together and have a clear understanding of your Financial Needs.