Investing In Baht Mutual Funds

[jfchandler]

I believe, the requirement to qualify for a retirement-based one-year extension of stay is 800,000 baht (not 880,000) on deposit in a Thai bank account, OR

65,000 baht in monthly income from any documented source OR

a combination of the two

Are any of these applicable to the 880000? minimum requirement for a yearly visa?

[SiamRose]

I believe, the requirement to qualify for a retirement-based one-year extension of stay is 800,000 baht

Is it still Bt800,000, or did it increase recently? You could buy a Thai government bond fund and then switch the money to your bank account when you need to renew your visa. Since you get approximately 0% interest in the bank you should come out ahead even after fund charges.

[ray23]

800K for single over age 50 as I recall it has to be ion the account for at least 90 days ?????? before applying issuance or renewal

[jfchandler]

Re retirement based extensions of stay, the 800,000 baht must have been in your Thai bank account for two months prior on your first year's application, and three months prior on all subsequent extensions.

However, if you use the combination method of bank deposit plus any amount of documented monthly income, there is no "seasoning" requirement. Nor, of course, is there any seasoning requirement at all if solely the monthly income method is used.

[fletchsmile]

I just thought I'd add a few stats to address a perception by some that mutual fund investments offer lame net returns in the short-medium term for relatively novice personal investors vis a vis direct share investments ... I have chosen three Thai equity funds pretty much randomly (not the top three performing funds)

K-Equity Fund. 6 month return 19.47%, 12 month return 39.04%. 1.5% management fee. 1% buy-in/sell-out fee (which I think only applies if done through agents)

ING Thai Equity Fund. 6 month return 10.63%, 12 month return 37.08%. 1.5% management fee. 1% buy-in fee

Aberdeen Siam Leaders Fund. 6 month return 20.69%, 12 month return 37.08%. 1.7% management fee. buy-in fee 0.5% and sell-out fee 0.25%

As has been stated elsewhere neither stocks nor mutual funds are necessarily good (or best) for everyone. Don't be seduced by the smooth-talking Pied Pipers of the investment world and narrow your focus too quickly. Before investing your money, first invest your time in learning a little about ALL the different investment opportunities available to you. Consider returns, but also risk, investment time-frame, the commitment of time required, and the many other factors specific to YOU.

Just to make it clear here: Each of your listed funds did underperform the index which had a good run up. Now mutual funds invest into shares (amongst other things) who pay out dividends as well and still are underperforming. Considering the index goes only sideways would most likely make the investor in mutual funds a loser not mentioning what's going to happen when the index trends down - Sitting on losses for a couple of months/years and having inflation and currency risk sucking on your funds make them less and less attractive.

So don't buy mutual funds if you have no basic idea about this type of investment regardless how many clueless people recommend them.

Would be very interested in the source of your claims on performance vs index. My own personal records as well as those of the fund houses show your claim wrong.

Both Aberdeen Siam Leaders and Ing Thai Equity currently exceed SET index over 1 year, 3 years, 5 years and since inception. The longer the time horizon the larger the outperformance of the mutual funds. I don't follow the other fund mentioned. Fund manager links to backl up my claims as below

http://www.ingfunds....nd/mbook-21.pdf

http://www.aberdeen-...hailandOpenABSL

They do look like good results. Three questions:

1) Do the results in the fact sheets include the ridiculously high fees?

2) How many laggard thai-stock funds have the same companies closed down in the last 10 years? If it is more than zero, you may assume that at least part of these results are due to luck not skill.

3) Why, since the funds do not pay out dividends, have they not compared to a total-return index? In fact, where did they pull these indexes from? They look quite unlike these ones:

http://www.set.or.th/en/market/tri.html

Obviously you've got pre-conceived ideas. I suggest you do your own research while you're sober

Answers:

1) Yes

2) No laggard Thai equity funds for Aberdeen and ING

3) If you knew the Thai mutual industry you'd know that this was their practice. Quoting TRIs is relatively new here in Thailand. Even the oldest TRI index uses a base date of 2002, compared to data going back over 30 years on the more old fashioned basis. The indices which are normally used and have been available for many years are at

http://www.set.or.th/en/market/market_statistics.html

Same website as you quoted, different page. A year or two back the Thai Stock exchange started to look at bringing in more global indices. These including FT indices, Shariah, etc. For many fund managers their funds and performance pre-date these new indices. They are still quoted though in accordance with AIMC guidelines

Why would anyone pay a 1% entry or exit fee and 1.7% per annum you asked earlier while drunk? The longest held fund I have here in Thailand is Aberdeen Growth. My own annualised growth rate after charges is around 19%, well in excess of the TRIs. 10 year return ~ 560%

[cocopops]

They do look like good results. Three questions:

1) Do the results in the fact sheets include the ridiculously high fees?

2) How many laggard thai-stock funds have the same companies closed down in the last 10 years? If it is more than zero, you may assume that at least part of these results are due to luck not skill.

3) Why, since the funds do not pay out dividends, have they not compared to a total-return index? In fact, where did they pull these indexes from? They look quite unlike these ones:

http://www.set.or.th...market/tri.html

Obviously you've got pre-conceived ideas. I suggest you do your own research while you're sober

Thanks for the answers.

Answers:

1) Yes

2) No laggard Thai equity funds for Aberdeen and ING

3) If you knew the Thai mutual industry you'd know that this was their practice. Quoting TRIs is relatively new here in Thailand. Even the oldest TRI index uses a base date of 2002, compared to data going back over 30 years on the more old fashioned basis. The indices which are normally used and have been available for many years are at

http://www.set.or.th...statistics.html

Same website as you quoted, different page. A year or two back the Thai Stock exchange started to look at bringing in more global indices. These including FT indices, Shariah, etc. For many fund managers their funds and performance pre-date these new indices. They are still quoted though in accordance with AIMC guidelines

Well I guess they are obliged to use that index or something. Personally I don't really see the relevance of the comparison though.

Professional money manager or otherwise, you would have to be quite unlucky for your total returns to fall below the capital appreciation component of the index returns. With sufficient diversification, you could guarantee it couldn't happen.