KUCHING: i-VCAP Management Sdn Bhd (i-VCAP), the manager of MyETF Dow Jones Islamic Market Malaysia Titans 25 (MyETF-DJIM25) and MyETF MSCI Malaysia Islamic Dividend (MyETF-MMID) funds yesterday announced the income distribution for two of its exchange traded funds (ETFs) listed on Bursa Securities.
i-VCAP in a press statement said the first and final income distribution for the two funds for financial year ended Dec 31, 2014 (FY14) will be distributed to the unit holders in the near future.
The company added that an income of 3.3 sen per unit will be distributed to MyETF-DJIM25 unit holders while income of 2.25 sen per unit will be distributed to the unit holders of MyETF-MMID.
For MyETF-DJIM25, i-VCAP noted the income is an increase from the previous full year’s total income distributions of 3.15 sen per unit and it represented the ninth income distributions made to MyETF-DJIM25 unit holders since its inception in 2008.
As for MyETF-MMID, i-VCAP said the income will be its maiden distribution since the ETF was listed on Bursa Securities on March 21 last year.
i-VCAP disclosed that the entitlement date for the income distribution of both funds shall be on March 9 and the payment date is on March 31.
i-VCAP explained that the income distribution amount is derived from the dividend income that the respective fund received from its stocks investment holding and profit income during the year.
Meanwhile, i-VCAP chief executive officer (CEO) Mahdzir Othman said, “As passive funds, MyETF series provide an investment instrument that is low cost, efficient, transparent and convenient to the retail and institutional investors.
“Given the various benefits of what ETFs can offer, we are looking to issue more ETFs on Bursa Securities as this will help create greater depth and variety of medium to long term investment tool for investors as well as to further develop the local ETF market,” he said.
In terms of fund performance, he observed that MyETF-DJIM25 increased gradually towards middle of last year when its net asset value (NAV) per unit reached its all-time high of RM1.2054 on July 7.
However, he noted as sentiment in the equity market turned bearish, the fund eased in the second half of last year and closed at RM1.1504.
As for MyETF-MMID, Mahdzir explained that its NAV per unit was generally above its initial issue price of RM1 per unit and reached its highest level of RM1.0742 on November last year.
However, he observed the value of the fund weakened in line with the general market (sentiment) in the last quarter (of 2014) and closed the year at RM0.9933 per unit.
Additionally, Mahdzir pointed out that the unit prices of both funds that were traded on Bursa Securities during the year were close to their respective NAVs most of the time.
Mahdzir added, “Despite its low liquidity, trading of ETFs on Bursa Securities is deemed efficient as the prices quoted on the exchange are generally in line with the fund’s NAV.
“In addition, it is also cost efficient for investors as there are no sales charges involved (besides brokerage charges) when investors buy or sell the ETFs on the exchange.
“Depending on the underlyings, investors may not expect short term volatility on the price performance of an ETF as it is structured similar to a unit trust investment,” Mahdzir noted.