If You Had 25m Baht How Would You Invest It?

[womble]

So obviously I know Thai Visa isn't the best place for economic advice, but it looks like i've sold my business, so have around 25m baht to invest somehow.

Being relatively young, 32, i'd rather have modest income and a higher capitol growth. I wish to stay in Thailand and already have several of my own ideas, but in these tricky economic times was just wondering what other members would do to achieve the goals i'm after with such a sum.

I do not wish to work, just invest it somehow that will bring in enough each month to live, maybe 100k or so, i'm mainly concerned with longterm growth of the original investment.

Edited October 23, 2009 by womble

[Benjie]

100,000 baht income is almost 5% return on that sum already, you would struggle to get that and any sort of guaranteed long term growth sensibly.

[cmsally]

There seems to be a maximum interest rate of 4% on offshore bank accts. I haven't seen anything that high in Thailand.

But 4% is few and far between.

There are all sorts of fund on offer which I have seen some of my friends trying to get their heads around. None of us are any the wiser.

The trouble is, you will be looking to live on the interest and capital appreciation is never really guaranteed (however that always seems to come in the small print); after the investment adviser estimates you will make 14%/year!

I think we are waiting with baited breath for those with the good ideas, they are few and far between at the moment.

[pagallim]

So obviously I know Thai Visa isn't the best place for economic advice, but it looks like i've sold my business, so have around 25m baht to invest somehow.

Being relatively young, 32, i'd rather have modest income and a higher capitol growth. I wish to stay in Thailand and already have several of my own ideas, but in these tricky economic times was just wondering what other members would do to achieve the goals i'm after with such a sum.

I do not wish to work, just invest it somehow that will bring in enough each month to live, maybe 100k or so, i'm mainly concerned with longterm growth of the original investment.

You don't say where you are from. However, invest no more than 10m baht in residential property in an area such as London, New York, Sydney etc (I know, that's only going to get you either a studio or 1 bed apartment), where you should get 5% rental income and the real potential of capital growth. Put another 10m into a longterm offshore investment account, and use the other 5m for living expenses (allowing for minimum % on a normal savings account, that should still see you through 5 years at your projected budget needs).

[womble]

I was thinking maybe some type of emerging markets bond funds. ETF's etc.

I'm from UK, lived here 8 years, have no intention of leaving Thailand at the moment, although u never know what the future holds as i've recently had a baby. I also want to avoid as many taxes and management fees as possible.

Edited October 23, 2009 by womble

[Penefattore]

So obviously I know Thai Visa isn't the best place for economic advice, but it looks like i've sold my business, so have around 25m baht to invest somehow.

Being relatively young, 32, i'd rather have modest income and a higher capitol growth. I wish to stay in Thailand and already have several of my own ideas, but in these tricky economic times was just wondering what other members would do to achieve the goals i'm after with such a sum.

I do not wish to work, just invest it somehow that will bring in enough each month to live, maybe 100k or so, i'm mainly concerned with longterm growth of the original investment.

Forget spending 100,000 baht per month if you wish to see your capital just retain its value.

"Risk free" investments yield practically 0% net of inflation, so you have to risk on stock markets or high yield currencies , none of these however is offering a 5% real return at the moment except BRL that already rallied a lot this year (meaning I don't know if it is wise to enter now at 1.72 reais to the $)

My advice is to limit your monthly spending to 30,000 baht and wait for a correction in stock markets and/or currency markets before investing.

[gotlost]

No problem buy up 25 million bt of bars and watch your money grow! (stagnate or nonexistent)

Go back to work.

[Penefattore]

I was thinking maybe some type of emerging markets bond funds. ETF's etc.

I'm from UK, lived here 8 years, have no intention of leaving Thailand at the moment, although u never know what the future holds as i've recently had a baby. I also want to avoid as many taxes and management fees as possible.

If you have a baby (and therefore I guess also a lady) then forget living on your 25 millions and look for a job asap ! Hope the missus is not aware of the money you have

[wordchild]

I personaly would go for shares over property and def avoid any insurance based products or guaranteed return funds (these are designed to make money for the people who sell them not for you!).

While there are some good mutual funds, fees can be quite high 1.5% + and maybe also some front end charges on top , that would take quite a bite out of your income and you would be lucky to find an emerging market fund that offers much more than a 2% annual yield.ETF,s have a big cost advantage but you need to find one that is suitable remembering that they are passive and therefore not activly managed funds the onus will be much more on you they also tend to be structured for capital gain rather than income.

Much better value than mutual funds are investment trusts,these trade on the (uk)stock market and usualy trade at a discount to their net assets,costs are mostly much lower than mutual funds and you can find some that offer pretty good yields. However the prices of many of the better managed emerging market trusts have been bid up recently such that many now trade at a premium to NAV.

To answer your question more directly, in your position and if i were intending to stay in Thailand long-term, I would put together myself a portfolio of 5/6 good quality Thai (and other Asian) stocks with a good dividend paying and corporate governance record. Despite the fact that the Thai market is up strongly since March it is still one of the cheapest (political problems) markets in Asia. Many Thai companies have the added advantage of having generous dividend payout policies yields of 6% + are not hard to find, and in many cases you can also look forward to reasonable dividend growth . But you do need to do the work as there is also a lot of rubbish out there as well, but if you have the time that can be part of the fun.

BTW on taxation ,as you may know, in Thailand,whatever your income, there is no further tax to pay on company dividends after the 10% witholding tax which is deducted by the company prior to payout

Edited October 23, 2009 by wordchild

[womble]

Always been put off Thai stocks due to issues with transparency and manipulation, also insider trading is rife.......

Shoot..... It's starting to look like my 25m isn't enough to survive on. I defo don't wanna go back to work, i've been working my balls off in my own business for last 7 years, fancied a break.........

Also wondering which are the best online discount brokers,

Is there special versions for offshore to avoid tax, or can any platform be used.

thanks,

W.

Edited October 23, 2009 by womble

[Serpico]

Read some investment books by Warren Buffet, Charles Schwab, Peter Lynch or John Bogel.

Don't try day trading, market timing, watching CNBC or hiring a stock broker.

Invest 70% in diverse ETFs or mutual funds with low fees. Dollar cost average by investing over the next 12 months.

Invest 30% in fixed deposits. CDs, Money Markets, etc.

Withdrawal no more than 4% a year.

Retirement investing survival calculator.

http://fireseeker.com/

[clinique]

Buy a 7/11 franchise for 2-3 million baht. yuo will get your investment back in 18-24 months and subject to location can clear 100,000- baht per month if you open a larger style store, i know 2 people that are doing it. Secure investment, all casha nd stock is tracked by central computer, so the staff cookin the books is almost impossible.

Put the rest in under yuor mattress, not sure how many banks will still be around next few years.

I would buy some Gold, or old equity ETF's, but likely only 10 million worht.. the other 10 keep in ready cash.

Cash is king..

[highchol]

send the money back to the UK you can 5.3% for 5 year savings bond.

Even with paying tax you can come out with 90k baht / month based on 55 b/pound.

If your married and jount account then you can claim the extra tax free allownce, should leave you with your 100 k you would like.

No growth potential though.

[churchill]

I would stay in cash for the present see how the markets pan out . and to Look into buying a condo in Bangkok to rent for income .

PS I would not change my Baht for Pounds .

Edited October 23, 2009 by churchill

[bkksw]

So obviously I know Thai Visa isn't the best place for economic advice, but it looks like i've sold my business, so have around 25m baht to invest somehow.

Being relatively young, 32, i'd rather have modest income and a higher capitol growth. I wish to stay in Thailand and already have several of my own ideas, but in these tricky economic times was just wondering what other members would do to achieve the goals i'm after with such a sum.

I do not wish to work, just invest it somehow that will bring in enough each month to live, maybe 100k or so, i'm mainly concerned with longterm growth of the original investment.

This is easy. You're only 32.. and 25m baht.. There are only two investments with a high probability of acceptable returns. Both are long term.

1. Invest in more education. Consider a degree in finance. Specifically a masters degree where the other students present will have significant business/finance experience and learn from them. Learn from the variety of instructors. But listen to no one. If you're sharp enough to have 25m baht by age 32, you're sharp enough to take the best each person has to offer and put it together into something that will show big returns.

2. Choose a university (there are plenty of decent western extension universities here in Thailand if you must..) and see if their curriculum includes real estate investment. On the side get a real estate and then brokers license in the state of your choice. The US housing market is at a all time low. Smart investment now and in the coming months will pay off huge.

In other words.. learn to answer your own questions about money. You are the only person you can and should trust. And remember, if it's easy.. you'll probably lose. If it takes a lot of hard work and dedication.. you're probably on to something worthwhile..

[Naam]

The US housing market is at a all time low. Smart investment now and in the coming months will pay off huge.

notwithstanding the fact that i like your various advice i think it's not the "real thing" to advice a Brit living in Thailand to enter the U.S. housing markets. but even if he did there won't be huge payoffs in the coming months. my [very] conservative estimate is "in the coming years".

[stevymac]

check out premium bonds maximum of 30k but each month u have a chance to win a million an shed loads of other smaller cash prizes! i know some ppl who have won 10k off just a mere 5k investment. good thing is ur money is always safe as houses!

[yeesipha]

HIIIIII

yes depends how big your balls are, how about 10kg of pure grade A cocaine, watch your money double in a matter of weeks,months.

Then your trouble really starts with what to do with hard cash!! .

ps only kidding !

[trogers]

You don't say where you are from. However, invest no more than 10m baht in residential property in an area such as London, New York, Sydney etc (I know, that's only going to get you either a studio or 1 bed apartment), where you should get 5% rental income and the real potential of capital growth. Put another 10m into a longterm offshore investment account, and use the other 5m for living expenses (allowing for minimum % on a normal savings account, that should still see you through 5 years at your projected budget needs).

Ahem...Lincoln Suites in Singapore has just opened for invited bookings yesterday. 43m2 studios were booked between Bt22-25m.

[wordchild]

Frankly I would say that your views on the Thai stockmarket are somewhat prejudiced. I invest in many markets and would say its no worse than anywhere else and in many respects standards of corporate governance are higher than some developed markets. The locals are heavy short term traders that is true but, if you can take a long term view and ,are investing real money ,then that can work to your advantage. As I said there are some dogs but there are also some gems. However you seem to have made your mind up which is your right.

On your other question on platforms and where to trade, it should not matter; the key issue is that you are a bona fide Thai (or non-Uk) resident and you can trade where you like ,with whom you like. No reason why you cant use a UK based stockbroker online or off.The Uk taxman has no claim on your dividends or capital gains (subject to the residency rules and time away from the Uk ) though cash on deposit is best kept offshore.

[chiang mai]

send the money back to the UK you can 5.3% for 5 year savings bond.

Even with paying tax you can come out with 90k baht / month based on 55 b/pound.

If your married and jount account then you can claim the extra tax free allownce, should leave you with your 100 k you would like.

No growth potential though.

I would guess that's not going to seem like good advice, before the five year lock in period expires, when interest rates may well be substantially higher.

[elcent]

As you said you want to have a break and not work now. I think that this may change at any time again.

There's a saying - "good old Hollywood is dying" and so the global economics, or at least changing.

I'd part the fund into three.

1/3 for saving account, the money you can easily live for years

1/3 as mentioned for EFT's etc..

and 1/3 you can invest like as a business angel where you take 30 - 40 of the shares. Most investors sell their shares after one to three years, with a profit ranging 3 - 10 times of their investment and depending on future prospects of the enterprise.

[elcent]

Sorry. I meant 30 - 40 percent. Was t late to edit the original post.

[bkksw]

The US housing market is at a all time low. Smart investment now and in the coming months will pay off huge.

notwithstanding the fact that i like your various advice i think it's not the "real thing" to advice a Brit living in Thailand to enter the U.S. housing markets. but even if he did there won't be huge payoffs in the coming months. my [very] conservative estimate is "in the coming years".

Well.. I did say both were long term..

Many non-US citizens invest in the US housing market, especially now that the dollar is so low to the Euro.. they're getting some true bargains. There are also tax advantages with real estate allowing deferment of profits for years.

You can invest as a principal in any number of investment groups which takes away the need to be there or know about the market, though these can be risky because you're depending on others.

And yes.. it might be years, but not too many. Once the market rebounds prices will go up faster than you'd believe. It's a matter of timing.. but I do believe the US housing market has more potential, if properly played, than most anything else out there..

Think about it.. in some choice Florida cities very nice/big homes in newer communities that were going for 2-3m three years ago, can now be purchased for 600-700k or even lower. If the market rebounds in say 2-3 years and that home can now be sold for 2m, the returns far exceed most other legal investments I know of. And if you're buying at historic lows, it's a good bet it can't go much lower and be much of a loss for very long. This is the perfect time for wise real estate investments in the states..

[Abrak]

Yes I definitely want to back a couple of people up on the shares front. A bias against them is very natural because the stock market is more than half where it was 15 years ago but that is the whole point. A bias against transparency may be fair to a certain degree but there are 400 companies out there. And many are pretty good - in Japan for instance there are only 8 stocks that have made an ROE of 10% consistently over the last 5 years - in Thailand there are dozens. Many stocks trade on 5x earnings with yields of 10%. And very safe and solid companies will give you 5% where dividends might double over the next 10 years. I mean I saw a report today recommending a sell on a stock with ROE of over 20%, 4.6x next years earnings and an 8% yield because the yield wasnt attractive - you wont get that from a bank.

Oh one final point, 90% of players in the market simply gamble or 'play' for fun, so if you do your homework you will be amply rewarded.

Theoretically a convertible bond is ideal for you - they usually have a 5% yield to maturity with the ability to convert into the shares if they go up. You have to be a bit careful though as they often think the conversion is on their side to not pay you back.

Edited October 23, 2009 by Abrak

[proximity]

Oh one final point, 90% of players in the market simply gamble or 'play' for fun, so if you do your homework you will be amply rewarded.

Where can you find out more information about the Thai stock market? What broker do you use?

[MaryWorth]

 Yes, take it to Singapore, open a foreign currency call account in Australian Dollars, you can open it even if you don't reside in Singapore, contact the offshore department of the banks, the interest rates for the AUD fixed deposits are good, and going up again now. Over 4% already, they used to be 7-8 %. So you have your cash in a safe bank, I consider safer than Thailand, more professional, English speaking staff, and your income is guaranteed as long as the AUD interest rates are good. You can get an ATM card and withdraw what you earned in interest in Thailand. 

[JimsKnight]

check out premium bonds maximum of 30k but each month u have a chance to win a million an shed loads of other smaller cash prizes! i know some ppl who have won 10k off just a mere 5k investment. good thing is ur money is always safe as houses!

I'd stand that as well. I've just invested 15k in some of those puppies.

I've also heard the prizes have just increased too.

Just be patient with them.

[ronz28]

Diversify with multiple investments and remember high returns = high risk. Continuously monitor and move money when needed.

Drill down and take your pick

http://www.tickerspy.com/ideas_research.ph...nception_change

Its up to you but I think the correction has started now so I would be in safe bank accounts for a few weeks or so until its over.

[Abrak]

Oh one final point, 90% of players in the market simply gamble or 'play' for fun, so if you do your homework you will be amply rewarded.

Where can you find out more information about the Thai stock market? What broker do you use?

Well I use Phillips - www.poems.co.th - which is an online trading system with charts and all data but I bet they all have it. A lot of people speak well of Seamico's system. I do think the Phillip's system is very good but I have tried others. It has a very good trading system too - just like being in a dealing room.

I am not much of a trader. When I like the look of a company I will usually go and see them. Thai companies are very receptive to that. The Thai market is so unloved they actually appreciate it, saying things like you are the first investor to visit us in two years.