Building a Stream
of Passive Income
Based on views by HwangDBS
Investment Management Berhad
One of Warren Buffett’s most famous investment sayings is “Be fearful when others are greedy. Be greedy when others are fearful”. In other words, there will always be opportunities in the market, even in times of crisis. The key is to be able to pick out the winners and sift out the unrewarding assets.
In times of economic uncertainties, one of the best ways to emerge from a crisis with a net gain is by taking refuge in high quality fixed income assets. Instead of holding cash in a persistently punishing low interest rate environment, investors can ride out this period with a net gain by investing in an asset class that gives the best of both worlds: stability and regular income.
What to look out for? The Good,The Bad & The Risky…
Before investing in anything, it is important to determine your end goal, time horizon, risk appetite and then proceed carefully with a firm understanding of the risks and benefits involved. Building multiple passive regular income streams will pave the way to building long-term wealth and eventually, allow you the freedom and time to do what you want.
The simplest way forward would be through investments that provide income. It could be in the form of direct investments in dividend stocks or unit trust funds. For the more risk averse investors, well-managed unit trust funds of this nature can offer those, who are willing to take on some risk, the rewards of positive real returns and the peace of mind that the fund manager is managing the money well.
Here are some reference points with regards to the main characteristics of dividend stocks and unit trust funds:
Three Key Steps To Managing Your Investment Portfolio
As an investor, you would have read many articles related to the current market scenario, financial planning and the efficient way to manage your money.Thus, one rule that you should remember is that investment is purely based on an individual’s financial needs and status.
Over the long-term, well-managed unit trust funds may perform well and may provide you with passive income streams. Its evergreen nature and relative stability due to the underlying assets make it an ideal asset to have in any portfolio regardless of age.
Talk to your Relationship Manager today for more information on starting a unit trust fund portfolio that best suits your needs.
This article does not constitute an advertisement, offer, invitation, commitment, advice or recommendation to make a purchase of securities or enter into any such transaction. The information given in this article represents the views of HwangDBS Investment Management Berhad. HSBC Bank Malaysia Berhad is not involved in the preparation of this article. The Bank neither endorses nor is responsible for the accuracy or reliability of, and under no circumstances will the Bank be liable for any loss or damage caused by reliance on, any opinion, advice or statement made in this article. Investment involves risks. You should refer to the offering documents and/or relevant documents for further details. You must make your own assessment of any such transaction and the risks and benefits associated with it and of all the matters referred to above in view of your investment experience, objectives, financial resources and circumstances. You should enter into transactions only after having considered, with the assistance of your external advisors, The specific risks of any such transaction.