Example:

Bought unit trust at RM0.64 3 years ago. Last month price is RM0.67.

Annual Profit = (RM0.67 - RM0.64) / 0.64 / 3 years = 1.5% (worst than FD or EPF)

The price of unit trust did fluctuate up and down, and return showed on the prospectus is assuming you sell every year to locked in the gains at the right time without including the sales charge of buying again. And every time there is a dividend, I notice the unit trust price (NAV) drop also. It is like it is trying to fool the investor so that we believe the return is high.

Hope the authorities will regulate the accuracy of facts/returns published by unit trust companies annually.

If you don't believe me, try to look at the NAV price of some unit trust few years ago and compared the price today. Not much difference unless you are very lucky to buy when the unit trust price drop due to a downturn/bad economy, but it will be pure luck and not consistent.

I want to share a true story here. I have been investing in unit trust for the past few years, and when I checked my statement lately, I found out that I am actually making a loss compared to EPF.

How can that be when the unit trust consultant showed me the graphs beating EPF returns last time? I ask another friend of mine which is an investor himself and he explain to me that each time you buy unit trust, there is a initial sales charge of a few % which eats up your performance eg. 2% - 5%. Assuming the return of the unit trust in that year is 6%, you don't get that 6%. You have to deduct the initial sales charge. And calculate yourself when the economy is bad and the return is negative.

If I could turn back time, I would stick to EPF despite what the majority said.