For this post, I am going to share a comparison of the return on investment between a fixed deposit versus MAAKL mutual funds.
I was doing a simple calculation and comparison for the RM5000 which I invested in MAAKL Dividend Fund and MAAKL Al-Fauzan Funds in the middle of the year 2007.
RM5,000 fixed deposit at 3.0% for 5 years
If the RM5,000 still sit in my bank fixed deposit, by now, my capital would be RM5,796.37 (assuming a 3.0% annual interest).
The calculation as below:
| Year | Capital (RM) | Interest (RM) | New Capital (RM) |
| Year 1 (2008) | 5,000.00 | 150.00 | 5,150.00 |
| Year 2 (2009) | 5,150.00 | 154.50 | 5,304.50 |
| Year 3 (2010) | 5,304.50 | 159.14 | 5,463.64 |
| Year 4 (2011) | 5,463.64 | 163.91 | 5,627.54 |
| Year 5 (2012) | 5,627.54 | 168.83 | 5,796.37 |
RM5,000 invested in MAAKL mutual funds for 5 years
But, because I invested the RM5,000 in MAAKL Dividend Fund and MAAKL Al-Fauzan Funds (RM2,500 for each fund), I earned an additional RM2,254.03 (based on unit price as of 12 Apr 2012).
The fund details are as below:
| No | Fund Name | Units | Unit Price (RM) | Estimated Value (RM) |
| 1 | MAAKL DIVIDEND FUND | 10,010.63 | 0.3772 | 3,776.01 |
| 2 | MAAKL AL-FAUZAN | 9,830.46 | 0.3538 | 3,478.02 |
| Total (RM) | – | – | – | 7,254.03 |
So far, I am happy with the return on investment for both of my MAAKL Mutual Funds.
There were times when I was thinking to sell off these funds, but in the end, I convinced myself to give a minimum of 5 years for both funds.
Again, of course, fund performance varies from time to time.
And always understand and be aware that for unit trust investment, there is risk involved.
For a fixed deposit, the risk is very minimal.
Final thoughts
I hope my sharing above on fixed deposit versus MAAKL mutual funds can provide some insight for those who are still thinking about whether or not to invest your fixed deposit to unit trust investment.
If the fixed deposit is additional cash that you are not going to use for the next 5 to10 years, you may want to consider investing in the unit trust.
Again, as a reminder, there’s always a risk in any investment.
Think about it, make your own decision and be responsible for your own decision.
There is no doubt your Unit Trust will outdo the fixed deposit BUT it is advisable to do dollar-cost averaging with Unit Trust investment. With Dollar Cost Averaging, your chances of losing money in a unit trust are much much lesser.
Just my 2 cents! 🙂
Yes, kampunginvestor… DCA minimize the chance of loosing money in unit trust investment.