PNB’s investment direction by new chairman; diversification is vital.

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Tan Sri Dr. Zeti Akhtar Aziz is an extremely accomplished banker (Bank Negara Malaysia governor for 16 years) and a well respected one too. She’s also the first woman to head Bank Negara Malaysia (BNM). When she was ‘younger’, she was part of the team who advised our 4th Prime Minister on the pegging of the ringgit in order to regain control of the economy during the 1997 ASEAN Financial crisis. After the new government was formed following the May 2018 election, she was also part of our Council of Eminent Persons too. She’s now the Permodalan Nasional Bhd’s chairman. So, with great position comes great responsibilities. Let’s understand her plans for PNB’s investing direction yeah.

Article in nst.com.my here. Permodalan Nasional Bhd (PNB) will begin investing in the equity markets within three years. Chairman Tan Sri Dr Zeti Akhtar Aziz said the markets that PNB was looking at include the United States, United Kingdom, Japan, France and Germany. The emerging economies will mainly be from both Asia and Europe. She explained that their strategy is to diversify their portfolio. They currently have 5-6% in the domestic bond market but are looking into different segments such as REIT. However, approval from PNB’s investment committee is needed. Zeti said the group’s portfolio diversification was ongoing with cash position reduced to 17.4 per cent by redeploying it to fixed income. “We are progressing well in our cash reduction as cash does not give us the returns that we want, while our international diversification is gathering pace with global assets now representing 3.3 per cent of the portfolio,” she said. Article in nst.com.my here.

The word here is diversifying the portfolio. I think this is super important. Loving the stock market does not mean one invests only in the stock market. Loving to touch the properties we buy also does not mean we only keep buying properties. Maybe stock market can be one where we buy unknown bluechips and keep? She also mentioned BOND. It’s important to have some inside unit trusts too, I believe. As for fixed deposit, as usual, a minimum of 6 months would be great. Anything extra means it will get just 4%, not sure if this is really the % we should be aiming for today and the future. Lots more to learn from PNB since Zeti is now the chairman. (by the way, chairman can mean a woman too) Happy following.

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<Featured Image is courtesy of Stock Photos from jittawit21>

Article written and edited by Charles. News article summarised by Dina Batrisyia.

written on 3 April 2019

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