Khazanah’s returns: 9.3% p.a. – CPF?

I refer to the articles “Khazanah says it has high annual returns” and “CPF Investment Scheme funds up average of 2.7% in Q3” (Straits Times, Nov 30).

The former states that “But Khazanah said that its Net Worth Adjusted (NWA) – which is realised and unrealised returns, as well as dividends – had more than tripled since managing director Azman Mokhtar took over in mid-2004.

“This translates into an annual compounded return of 9.3 per cent per annum over the 13-year period, rather than just the 1 per cent or 2.6 per cent return as is implied by the articles,” it said.

The Straits Times, after analysing Khazanah’s published financial records, had reported that the fund’s dividend rate was below 1 per cent while its profit before tax was 2.65 per cent of the fund size during the same period.

The fund confirmed that its NWA growth was lower than the Kuala Lumpur Composite Index’s 9.4 per cent pace during those 13 years. The index is the benchmark for Malaysia’s stock exchange.

The Straits Times had also found that Khazanah’s NWA growth was slower than that of China Investment Corporation (CIC).

Khazanah’s profit before tax, before taking into account unrealised gains and losses, was also lower than Singapore’s Temasek Holdings, CIC, Alaska Permanent Fund Corporation and the world’s largest sovereign fund, Norway’s Government Pension Fund Global”.

So, since Khazanah’s annualised return was 9.3 per cent in the last 13 years – what was the return derived from investing our CPF funds, relative to the 2.5 per cent interest paid on our CPF Ordinary Account?

In this connection, the latter article states that “CPF members who invested in funds that are part of the Central Provident Fund Investment Scheme (CPFIS) reaped average returns of 2.7 per cent in the three months to Sept 30.

During the same period, CPFIS-included unit trusts rose 3.06 per cent, while investment-linked insurance products (ILPs) increased 2.49 per cent, according to fund research firm Thomson Reuters Lipper on Wednesday (Nov 29).

For all CPFIS-included funds, equities posted positive returns of 3.50 per cent, mixed-asset added 2.23 per cent, while bonds and money market funds grew 0.33 per cent and 0.15 per cent respectively.

 

For the year to Sept 30, CPFIS funds delivered an average return of 13.14 per cent, with unit trusts up 14.76 per cent and ILPs rising 12.19 per cent. Meanwhile, the MSCI AC Asia ex Japan Index soared 22.53 per cent while the Citigroup WGBI TR fell 3.08 per cent. For the one-year period, on average, equities (+17.57 per cent) outperformed bond offerings (+0.08 per cent), mixed-asset (+10.13 per cent) and money market funds (+0.57 per cent).

CPFIS-linked funds performed better when viewed over the longer term. Their performance for the three-year period ended September was up 19.25 per cent on average. Unit trusts soared 19.90 per cent over the same period while ILPs rallied 18.93 per cent. For comparison, during this period, MSCI AC Asia ex-Japan Index rallied 34.86 per cent and Citigroup WGBI TR rose 9.32 per cent. Equities were the lead gainer with growth of 23.30 per cent, while bonds posted 8.55 per cent returns on average.”

Why is it that normally only one and 3-year annualised returns are reported in the media? Why is it that the 5, 10, 20-year and from inception annualised returns of the CPFIS are not reported?

 

Leong Sze Hian

 

 

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7 Responses to “Khazanah’s returns: 9.3% p.a. – CPF?”

  • N.Jungne:

    Yah yah show us the money

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  • oxygen:

    CPF BOARD MUST KNOW FROM ITS INTERNAL RECORDS that there are a significant proportion of CPF members have CONSISTENTLY ACHIEVE far better than the 2.5% annual paid by them.

    Why hold these people back from progressing forward to financial independence instead of handcuffing their fortune to CPFB’s own deadsh*t performance from time historical?

    I can’t think of any valid reason other than a HIDDEN ROTTEN POLITICAL AND ECONOMIC AGENDA in deception of peasants. If they allow this minority to consistently outperform CPFB of investment returns, the REST OF SINKIES WILL DEMAND THE FREEDOM TO SELF-MANAGE THEIR OWN RETIREMENT MONEY – at least past 55 years of age. Down Under allow peasants to manage completely their superannuation funds.

    WTF.

    PAPpys is using their failures to perform to conceal their incompetence and hidden rotten political and economic agenda – one which involve “borrowing” in escalating sums of money, never to return until mortality – a camouflage of stealing our superannuation via perpetual trustee deception – which by statutory and common law application is ILLEGAL.

    WHEN IS THE FARKING 70% GOING TO WAKE UP?

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  • pap selected INDIAN president:

    CPF money was a convenient cheap source of funds for pap government, without any need to be accountable to CPF members.

    until Mr Roy Ngerng pursued, pap lies CPF money is not gic money temasick money were the lies of the day. departed pap evil lky lied. wooden lied. in fact, all of them pap Ljs and pap Cbs who ever said about CPF money lied. ALL of them. without exception. even that ah neh snake botak lied.

    when they paid 2.5% and 4.0% they even had the cheek to say every 3 months they stay or shall be changed. they actually had intention of not even paying 2.5% and 4.0%. WTF.

    remember. we the 4 of us do NOT want our own money in CPF at all. but since it was forced on us, we do not agree but accept. even so, CPF money is still our own money. when anyone uses our money, by force without our agreement, we expect fair compensation. otherwise, it is nothing but pure robbery.

    husband chairman gic wife ceo temasick both sucking our CPF money without giving us an account of how much we have been cheated of our due.

    WTF. daylight robbery.

    that is one reason why we are telling everyone we need New Government in power to investigate such ABUSE of power and put these pap Ljs and pap Cbs in changi chalet for long long if facts prove ABUSE of power.

    New Government. not any pap parleement wayang ownself exonerate ownself parleement.

    ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
    ownself check ownself? WTF. we don’t believe. we are not the 70% sheep.
    ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

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  • RDB:

    Uncle Leong Sze Hian,

    Will appreciate if you will at least once upfront within brackets give us the full name of your abbreviations. As many of us are not familiar with them all. Not such investors you see.

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  • Something's amiss:

    The more transparent the Malaysians are about their retirement fund the more suspicious you get about those managing our CPF.

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  • LIONS:

    Malaysia’s EPF is a bona fide pension fund,our. CPF is a Central Fraudulen Fund?
    Lack of oppo is the rea$on?
    Gahmen behave worse than FEUDAL LORDS?

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  • The Real Truth Hurts:

    Roy was sued by the evil clown, so Roy must be telling the truth and exposing the lies of PAP.

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