Thai Girl With Money To Invest

[loong]

My Thai girlfriend now has a relatively large sum ( for a Thai) languishing in her bank account.

The best rate of interest the bank can offer her is a paltry 1 percent. Unbelievable!

Any suggestions how she can better this?

Thanks

[uhuh]

My Thai girlfriend now has a relatively large sum ( for a Thai) languishing in her bank account.

The best rate of interest the bank can offer her is a paltry 1 percent. Unbelievable!

Any suggestions how she can better this?

Thanks

<{POST_SNAPBACK}>

Fixed term deposit gets a bit more than 1%. Every bank has this. They may require a minimum investment.

The best is probably a money market fund. You get about 1.7%, eg www.ajffunds.com, the Cash Management fund looks good enough. Better than fixed term deposit because she can always withdraw money on short notice. (Other asset management companies are ingfundsthai.com, tmbam.com, scbam.com, aberdeen-asset.co.th, k-asset.co.th). Minimum investment is very low, eg AJF's Cash Management Fund 10 000 Baht.

Government bonds get between 2.3% and 3.5% (TTM 1 year). Look at www.bangkokbank.com, you can find prices and yields. Bangkok Bank requires 500 000 Baht minimum investment, I don't think others require much less.

In another thread about low interest rates, an offer of AJF is mentioned that gives 3% in the first year, 4% in the second and 5% in the third year. Try to check this out.

Debentures: higher yield and higher risk than government bonds. See above.

Dividend yields in Thailand are relatively high (easily 5%), LHR and CENTEL spring to mind. These are defensive stocks, but it is stocks, so it is risky, especially as the SET may be at a peak.

[loong]

Thanks for the info

sorry to be a bit ignorant, but what is AJF ?

I think it incredible that can get up to 7 percent in UK, but returns so low here.

I dont want to advise her to invest out of country as fluctuations in exchange rate makes it more risky. Could end up to her benefit but could easily go the other way.

[Rinrada]

The Guys at the top who are making the big dosh will never allow the peasants to really benefit.

So wot do the international money boys think about LOS.....a basket case .....u must be joking

A perfect time to buy into Thailand

A professional investor tells MoneyWeek where he'd put his money now. This week: *****, associate director at ** Asset Management.

Last year, one of the best-performing markets in the world was Thailand.

It rose a good 116%. So it was no surprise that many analysts started 2004 positive on the market's prospects.

Unfortunately, they were wrong: year to date, the market has fallen more than 20%. This sounds bad, but it is not a disaster given that the market has more than doubled from its lows in 2001. Is the fall an investment opportunity, or simply a sign that the consensus optimism was unfounded?

One of the more unusual aspects of the correction is that it happened at a time when the news out of Thailand looked good on both an economic and a company level. As Thailand steadily fell, so better data were released. In the first quarter many firms released results ahead of analysts' forecasts, while both exports and imports grew faster than expected. The main figure to disappoint was first-quarter GDP growth, which caused analysts to revise down their forecasts. But this still left growth at a pretty heady level, with NESDB - an economic think tank - predicting 7.7% for the year.

So how can the falls be justified? Take international capital flows. Foreigners were net sellers of the Thai equity market every month from September 2003 to June this year. This appears to be more a reflection of global investors shunning risk, rather than a specific dislike of Thai equities.

As oil prices rose and China implemented measures to slow its economy, many of last year's best-performing markets pulled back. Thailand has also had its own specific problems with bird flu and terrorist concerns, but neither of these would justify such a big fall in equities. There has been poor news from the property sector, which could be taken as a sign that the economic situation is deteriorating, but I'm not sure this is right. The first quarter is often a slow one for property, and Macquarie Research estimates that, while 17 of the 45 companies that they cover produced results worse than the previous quarter, in aggregate they were still better than the year before.

I believe the fall leaves us with an opportunity to invest in Thailand. Earnings have been rising as stocks have been falling, proving the strength of the operating environment and making the market's valuation more attractive. Companies in Thailand now have greater cash to hand than in the past, and are de-leveraging rather than throwing money at spurious investments, as has too often been the case before. The other enticing factor is that growth is moving away from overriding dependence on exports. This could partially insulate companies from one of the greater risks for equities - the deceleration of growth in China and the USA.

So what would I invest in now? In banks and construction stocks - both areas that have sold off dramatically during the downturn, but where earnings growth is good. Three stocks that fit the bill are Bangkok Bank, Land and Houses and Thoresen Thai Agencies. Bangkok Bank is one of the country's better-quality banks and should be a direct beneficiary of continuing growth. Land and Houses is a property developer that has fallen dramatically year to date, and Thorensen Thai is a shipping company that is likely to pay a high dividend.

from one of the majour moolah advisors

[loong]

Wow! Quite a reply and thanks very much.

As far as stocks and shares go, I know that this is not an option for the faint hearted as I invest in the UK market myself.

I think that my girlfriend needs to invest in a safe and solid way, I dont think that she could cope with the major fluctuations in shares and would pull out after a major dip.

[uhuh]

Wow! Quite a reply and thanks very much.

As far as stocks and shares go, I know that this is not an option for the faint hearted as I invest in the UK market myself.

I think that my girlfriend needs to invest in a safe and solid way, I dont think that she could cope with the major fluctuations in shares and would pull out after a major dip.

<{POST_SNAPBACK}>

AJF means Ayudhya JF (JF is JPMorgan-Fleming), look at the website ajffunds.com

The article about stocks is from 2004!

Now is not a perfect time to invest ion Thailand. There is a good chance that stocks will rise 20 or 30% in the next months (based on chart analysis) or even almost 50% (based on fundamentals). If they would rise more than this the PE would be higher than it ever was.

The downside risk is considerable: the world economy seems to be slowing, hot money will probably leave risky assets like emerging markets, China may still be in for a hard landing, and the sustainability of Thaksin's economic policies is doubtful.

Safe and solid means moneymarket funds or government bonds (if she has enough).

[haha]

investment strategies can be a very sensitive subject.

if someone recommends something, and then you lose on it. well, you get the picture, I think.

with that said and done, let me just give you some urls as food for thought.

www.bankrate.com

www.jbhanauer.com

[simcity]

To be conservative and hope safe !

Some in stocks

Some in gold

Some in currency ( yen )

Some in deposit

[pluto_manibo]

Tell her to invest into some land in the pattaya area or the area around the airport and sit on it for a few years....

[bakachan]

there are plenty of foreign banks in thailand. I would check out the rates they offer.

Right now i'm getting 2.9% in my money market account in the us with no minimum

balance.

To avoid any type of currency fluctuations you could consider new zealand dollars

or swiss franc's. Both are very stable currencies because both countries govt's

have solid balance sheets (no defecits), stable govt's, low terrorism risk and

a higher interest rate than 1%

[Mobaan]

there are plenty of foreign banks in thailand.  I would check out the rates they offer.

Right now i'm getting 2.9% in my money market account in the us with no minimum

balance. 

To avoid any type of currency fluctuations you could consider new zealand dollars

or swiss franc's. Both are very stable currencies because both countries govt's

have solid balance sheets (no defecits), stable govt's, low terrorism risk and

a higher interest rate than 1%

<{POST_SNAPBACK}>

[Mobaan]

there are plenty of foreign banks in thailand.  I would check out the rates they offer.

Right now i'm getting 2.9% in my money market account in the us with no minimum

balance. 

To avoid any type of currency fluctuations you could consider new zealand dollars

or swiss franc's. Both are very stable currencies because both countries govt's

have solid balance sheets (no defecits), stable govt's, low terrorism risk and

a higher interest rate than 1%

<{POST_SNAPBACK}>

<{POST_SNAPBACK}>

Where in the USA would you get that kind of return--could you be a bit more specific,please!

[nev]

i dont no if thai's can put money in off shore accounts i have my money in australia in a internet bank account called ing direct ot pays 5.4% intrest calculated daily and no minumun balance might be worth a look.

www.ingdirect.com.au

[Thetyim]

ING give good rates but you must be resident to make a deposit in that country.

I have a UK passport but cannot deposit in ING UK , a mailing address is not enough to open an account.

[loong]

Thanks for all the varied advice and information.

Re the advice to buy land in Pattaya

We have just returned from Pattaya and did look around at property there. We came to the conclusion that we have well and truly missed the boat there.

I would not like to rely on property prices increasing there as mostly they seem to be ridiculously high. Possibly there is unsustainable optimism about property prices there. There are a lot of empty properties, but still they keep building. Sellers now seem to expect around 5 mill Baht for a 4 storey shophouse in Soi Beuakhow (south end ) compared to 2 mill 2 years ago.

We also looked around Jomtien. Soi welcome had 3 storey shophouses for around 2.5 mill ( as a shell, no tiling, electric, bathrooms etc). But again, a lot of empty property.

As for condos etc, agents are advertising with such a flourish that condo buildings and village houses are 60 percent sold. The way I read it is that 40 percent are not sold! They also include in their adverts such things as " We have 4000 properties on our books". This is obviously meant to indicate that with them a buyer will get a lot of choice. To me, however, it suggests that there are too many properties on the market.

It does appear to me that there are more properties for sale than there are buyers and to buy into the Pattaya property market at the moment could prove to be very risky. I appreciate that the normal rules of economics do not always apply in Thailand. If there are more sellers than buyers in the UK, then prices will drop. This is not necessarily true here, especially when so much of the property that is for sale belongs to just a handful of people. Somebody with 200 properties for sale, would prefer to sell only half than allow proper market forces to operate.

My conclusion is that the Pattaya property market is in danger of overheating and not worth the risk right now.

[Heng]

As many Thai gals with the means to invest will tell you... 30 year T-bills are the way to go.

[Mandu]

Depending on your location this may or may not be relevant.

My GF was just telling me about the village banks. I do not know a lot about it but apparently you can lend money that is administered by a committee and is government approved etc.

Other local people borrow the money and it is supposedly gauranteed and safe. Interest is 2% per month = 24% per year. Not bad if it works out.

Does anyone else have any experience with this?

Mandu

Edited June 5, 2005 by Mandu

[Yangpuss]

Thanks for the info

sorry to be a bit ignorant, but what is AJF ?

I think it incredible that can get up to 7 percent in UK, but returns so low here.

I dont want to advise her to invest out of country as fluctuations in exchange rate makes it more risky. Could end up to her benefit but could easily go the other way.

<{POST_SNAPBACK}>

Loong, where can you get 7% in the UK?

Can a foreigner invest in such a UK account?

If he did, would his deposit be insured against bank failure?

Thanks.

[Yangpuss]

My Thai girlfriend now has a relatively large sum ( for a Thai) languishing in her bank account.

The best rate of interest the bank can offer her is a paltry 1 percent. Unbelievable!

Any suggestions how she can better this?

Thanks

<{POST_SNAPBACK}>

Fixed term deposit gets a bit more than 1%. Every bank has this. They may require a minimum investment.

The best is probably a money market fund. You get about 1.7%, eg www.ajffunds.com, the Cash Management fund looks good enough. Better than fixed term deposit because she can always withdraw money on short notice. (Other asset management companies are ingfundsthai.com, tmbam.com, scbam.com, aberdeen-asset.co.th, k-asset.co.th). Minimum investment is very low, eg AJF's Cash Management Fund 10 000 Baht.

Government bonds get between 2.3% and 3.5% (TTM 1 year). Look at www.bangkokbank.com, you can find prices and yields. Bangkok Bank requires 500 000 Baht minimum investment, I don't think others require much less.

Uhuh, what exactly is the risk on a government bond? Does the principal fluctuate?

Edited June 6, 2005 by Yangpuss

[LivinLOS]

Depending on your location this may or may not be relevant.

My GF was just telling me about the village banks. I do not know a lot about it but apparently you can lend money that is administered by a committee and is government approved etc.

Other local people borrow the money and it is supposedly gauranteed and safe. Interest is 2% per month = 24% per year. Not bad if it works out.

Does anyone else have any experience with this?

Mandu

<{POST_SNAPBACK}>

The only thing I would say is that ANY 24% per annum (and it would higher if 2% per month was compounded) will not be 'guaranteed and safe' investors would be crawling all over it if there was reasonable and complete guarantees

[Mandu]

Depending on your location this may or may not be relevant.

My GF was just telling me about the village banks. I do not know a lot about it but apparently you can lend money that is administered by a committee and is government approved etc.

Other local people borrow the money and it is supposedly gauranteed and safe. Interest is 2% per month = 24% per year. Not bad if it works out.

Does anyone else have any experience with this?

Mandu

<{POST_SNAPBACK}>

The only thing I would say is that ANY 24% per annum (and it would higher if 2% per month was compounded) will not be 'guaranteed and safe' investors would be crawling all over it if there was reasonable and complete guarantees

<{POST_SNAPBACK}>

[Mandu]

As I indicated in my first post according to the individuals situation this scenario will not fit all.

However, my understanding is that you have to be a member of the co-op Bank which means that you have to be Thai and live in that particular village. You have to be approved to be a member and to borrow. Of course a Thai wife/girlfriend can do it on behalf of her boyfriend/husband (foreigner).

I believe that it is the government sponsored alternative to the shark loans that many rural people were taking out at a similar rate of interest with their land title as the security.

I have been told that last year the government asked anyone who felt that they had been unfairly dealt with or had forfeited their land to tell them who the people were that loaned them the money and they investigated them.

Some people had their loans reduced and their land returned to them. Presumably some lenders had some explaining to do re tax etc.

Many of the people that borrow in this way are prepared to pay the interest rate for what is hoped to be a short term loan. Many do not want to go through the rigamarole required by banks or would not fit the criteria for a myriad of reasons that does not necessarily indicate that they are a bad risk for a loan.

If any of my points are not correct feel free to advise.

Regards

Mandu

[malcolminthemiddle]

My Thai girlfriend now has a relatively large sum ( for a Thai) languishing in her bank account.

The best rate of interest the bank can offer her is a paltry 1 percent. Unbelievable!

Any suggestions how she can better this?

Thanks

<{POST_SNAPBACK}>

It is only hearsay, but I heard ABAC are offering student rooms for sale at Baht 400,000 with a monthly rental return of Baht 5,000.

Depending on your location this may or may not be relevant.

My GF was just telling me about the village banks. I do not know a lot about it but apparently you can lend money that is administered by a committee and is government approved etc.

Other local people borrow the money and it is supposedly gauranteed and safe. Interest is 2% per month = 24% per year. Not bad if it works out.

Does anyone else have any experience with this?

Mandu

<{POST_SNAPBACK}>

I personally know of a BKK lawyer who, 5 years ago, was offering a high return to investors, paid monthly. The money was lent out to farmers and other rural people using land titles for security. I don't know exactly what happened to the scheme (I did not invest) but I do know the lawyer disappeared leaving a lot of problems in his wake.

[meom]

Depending on your location this may or may not be relevant.

My GF was just telling me about the village banks. I do not know a lot about it but apparently you can lend money that is administered by a committee and is government approved etc.

Other local people borrow the money and it is supposedly gauranteed and safe. Interest is 2% per month = 24% per year. Not bad if it works out.

Does anyone else have any experience with this?

Mandu

The only thing I would say is that ANY 24% per annum (and it would higher if 2% per month was compounded) will not be 'guaranteed and safe' investors would be crawling all over it if there was reasonable and complete guarantees

My missus has a couple of mil in the bank and the local branch of Bangkok Bank out in the sticks offered her a similar deal which is pretty good cause they give 15k baht interest per year on 60k baht deposit. The disadvantage is that they accept no higher deposit than 60k baht.

[loong]

As many Thai gals with the means to invest will tell you...  30 year T-bills are the way to go. 

<{POST_SNAPBACK}>

Again, showing my ignorance. I have absolutely no idea what this means! Sorry

Loong, where can you get 7% in the UK?

Can a foreigner invest in such a UK account?

If he did, would his deposit be insured against bank failure?

I can't remember where I saw 7percent. But was either LLoydstsb subsidiary or Nationwide. I believe was some sort of bond, so would require tying up your money for some time.

I am back to the UK next month and will be making enquiries as to how easy it is for a foreigner to invest in UK, but I am sure it must be possible. The only problem that I can see is that UK is very hot on money laundering nowadays, so bank would need to know that cash came from a legitimate source.

I think that the main UK banks are as secure as any in the world, so a bank failure is extremely unlikely.

Incidently the villagers have now discovered that the gf has money and there have been a steady stream of people coming to the door to try to borrow money. Referring to previous postings, most of this people have taken out these local government loans and do not have the funds to pay back. I dont know if this is the same scheme as mentioned, but the people take a loan and have to pay back with interest after 10 months or 1 year. Usually they borrow the money to pay back off of someone else and once they have paid back can borrow again. I hope this makes sense. It seems that the local groups have borrowed a lot of money and nobody can pay back. From this, I dont know how secure this 2 percent per month thing is. It's a great interest rate, if the money comes back. If land paper comes instead is normally virtually worthless as finding a buyer for the land could be difficult.

[paulfr]

To be conservative and hope safe !

Some in stocks

Some in gold

Some in currency ( yen )

Some in deposit

<{POST_SNAPBACK}>

This is good advice.

Gold protects well against runaway inflationary risks.

But you need govt bonds to protect against deflationary risks too.

At least in the US.

[aletta]

The total guarantee on bank deposits is to be gradually reduced to a million Baht so it may be best not to lock in for too long.

Thai stocks sure do have good yields but that is a compensation for the huge risk one takes.

[uhuh]

My Thai girlfriend now has a relatively large sum ( for a Thai) languishing in her bank account.

The best rate of interest the bank can offer her is a paltry 1 percent. Unbelievable!

Any suggestions how she can better this?

Thanks

<{POST_SNAPBACK}>

Fixed term deposit gets a bit more than 1%. Every bank has this. They may require a minimum investment.

The best is probably a money market fund. You get about 1.7%, eg www.ajffunds.com, the Cash Management fund looks good enough. Better than fixed term deposit because she can always withdraw money on short notice. (Other asset management companies are ingfundsthai.com, tmbam.com, scbam.com, aberdeen-asset.co.th, k-asset.co.th). Minimum investment is very low, eg AJF's Cash Management Fund 10 000 Baht.

Government bonds get between 2.3% and 3.5% (TTM 1 year). Look at www.bangkokbank.com, you can find prices and yields. Bangkok Bank requires 500 000 Baht minimum investment, I don't think others require much less.

Uhuh, what exactly is the risk on a government bond? Does the principal fluctuate?

<{POST_SNAPBACK}>

The principle is paid back in full at maturity. Until then, you can sell the bond in the market but you may get not what you paid but more (if interest rates have fallen since you bought the bond) or less (if interest rates have risen since you bought the bond). At the moment, interest rates are rising, so I would only buy a bond if I am sure I won't need the money before maturity, especially a bond that will be paid back in a year or so, not much longer (because when I get this bond paid back, I can buy a new one with higher interest)

Then there is the risk that the government will default on its domestic debt - very unlikely in the short term.