T. Hidayat
\nContributor
\nJakarta<\/p>\n
The government law number 8\/1995 on capital markets issued in
\n1995 caused the proliferation of mutual fund companies in the
\ncountry. Within six months after the law came into effect, more
\nthan 20 such companies made public offerings that exceeded 12.5
\nbillion units.<\/p>\n
However, the party did not last long. Toward the end of 1997
\nthe country was hit hard by the economic crisis, which dwindled
\nthe number of investors in this fledgling business.<\/p>\n
Apart from decreasing the value of mutual funds products, the
\neconomic crisis also hurt prices of shares and bonds. The new
\nmutual fund investors, partly due to lack of knowledge, panicked
\nand quickly sold out their equities. Mutual funds were no longer
\nattractive as, almost simultaneously, banks were offering sky-
\nhigh interest rates of up to 70 percent annually for deposits.
\nAnd that seemed the right place for almost everyone's money.<\/p>\n
Although in the earlier days of growth, the mutual fund
\nbusiness was hit by the economic crisis, its development on the
\nwhole in later years, according to director of PT Schroder
\nInvestment Management Indonesia Michael T. Tjoajadi, was
\ncategorized as comparatively healthy due to its resilience. He
\nadmitted that most Indonesians still preferred to keep their
\nsavings in bank deposits, which is one of the hampering factors
\nfor the growth of mutual funds. In developed countries, he said,
\ninvestments could be in various forms, including mutual funds,
\nbonds, shares and so forth.<\/p>\n
However, this attitude is understandable as bank deposits are
\nguaranteed by the government, unlike investments in mutual funds.<\/p>\n
The major players in this business soon realized that they had
\nto actively communicate to the public and "educate" them on the
\nbenefits of investing in mutual funds. Hence, the massive influx
\nof not only advertisements, but also benefit-related news in the
\nmedia to focus on the uniqueness of such investments.<\/p>\n
To invest, one does not have to wait until one has a lot of
\nmoney. Just like Robert T. Kiyosaki wrote in his book Guide to
\nInvesting, a true investor does not wait until he is rich enough
\nto make investments. Investments of small amounts, like in mutual
\nfunds, can start at any time. With only Rp 200,000 (about US$ 23)
\none can purchase an equity of a blue-chip or well-established
\nmutual fund.<\/p>\n
Today, various types of mutual funds are available on the
\nmarket. For rather adventurous investors after large profits,
\nstocks are suitable, while for the more moderate type there are
\ncombined mutual funds or those with fixed returns. The lowest
\nrisks are perhaps in the money market accounts.<\/p>\n
"All kinds of investments, especially those that offer larger
\nprofits, are prone to risks," said Michael. Investments in mutual
\nfunds are indeed more profitable in comparison with the interest
\nrates of bank deposits, but behind the opportunities for making
\nmore profits lie the equally possible risks, like the decrease of
\nnet value. Quite a number of mutual funds between 1998 and 2000
\nexperienced this kind of slump in their net value.<\/p>\n
The mutual funds specializing in money market, which,
\naccording to Michael, is a more secure form of investment
\ncomprising Bank Indonesia's certificates and the country's major
\nbanks' deposits. In view of the fact that mutual fund companies
\nhandle huge amounts compared with any individual's deposit, the
\nrate of return is obviously much higher. Normally, this type of
\nmutual fund is the closest alternative to keeping money in bank
\ndeposits.<\/p>\n
Likewise, also preferred by most "cautious" investors are
\nmutual funds that deal with bonds, which offer a return of 20
\npercent annually.<\/p>\n
Choosing which mutual funds to invest in is certainly not
\neasy. A few years ago, many people suffered losses in the
\nbillions of rupiah from investments considered to be healthy.
\nHowever, especially since the end of 2001 or early 2002, things
\nhave changed for the better, as most mutual funds in the country
\nhave bounced back and provided returns that were much higher than
\nthe interest rates of Bank Indonesia's certificates or even the
\ncountry's top bonds.<\/p>\n
Apart from deciding on which mutual funds to invest in,
\nanother important factor is the role of the fund manager that one
\nappoints to take care of one's investments. The track record and
\nstyle of investing of a fund manager are among the prerequisites
\nin selecting the right fund manager. Other features to be
\ncarefully noted are the ease of the registration process, the
\nminimum amount to be invested, the amount of management fees and
\nother related services provided by the fund manager.<\/p>\n
One of the world's leading financial services company,
\nManulife, with 250 offices in 15 countries and over 30,000
\nemployees worldwide, has even more to offer including via its
\noperations in Indonesia.<\/p>\n
Manulife Aset Manajemen Indonesia, a part of such a huge
\nmultinational financial services organization, has access to the
\nbest independent research information to provide sophisticated,
\ncustomized investment solutions and superior investment
\nperformance to its clients in Indonesia.<\/p>\n
Its mutual fund products, categorized as among those most
\nsought after by investors and containing the most important
\nqualities such as flexibility, convenience and, above all,
\ntransparency include: Phinisi Dana Saham (Equity Fund), Phinisi
\nDana Tetap Pemerintah (Government Bonds Fund), Phinisi Dana
\nCampuran (Balance Fund), Phinisi Dana Kas (Money Market Fund),
\nDana Tetap Instan (Treasury Management Fund) and Manulife
\nPendapatan Bulanan (Monthly Income Fund).<\/p>\n
Among the company's strengths is the team-based approach to
\nasset management that incorporates, among other things,
\nfundamental, quantitative and econometric models to structure
\ncomposites that meet the portfolio's policies, objectives and
\nrisk profiles while aiming to match or even surpass the pre-
\nestablished investment performance goals.<\/p>\n
With currently about 15,000 investors and mutual fund assets
\nunder management standing at IDR 4.2 trillion -- both figures
\nexpected to grow by the end of the year -- Manulife Aset
\nManajemen Indonesia is one of the largest fund management company
\nin the pure-breed fund category. Its reputation is further
\nreinforced by ISO certification for high quality operations and
\nstrict documentation procedures.<\/p>\n
With the wide-ranging mutual funds available in the country
\nalong with the enhanced services of related companies, most
\ninvestors' headaches are hopefully gone in view of the currently
\nmore positive economic situation. So, turning to mutual funds as
\nan investment strategy has become a more natural alternative.<\/p>",
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"sponsor": "Okusi Associates",
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