Understanding the Prospectus: Your Essential Investment Guide
When you invest in a unit trust in Malaysia, understanding the Prospectus is one of the most important steps before committing your money. Also known as the Master Prospectus when it covers multiple funds, this document is your official guide to how a fund works — its goals, strategies, risks, and costs.
Think of the Prospectus as your user manual for investing. It’s legally required and is designed to help you make informed decisions with confidence. Whether you're new to investing or building a diversified portfolio, the Prospectus helps you know exactly what you’re investing in.
What to Look for in a Prospectus
- Investment Objective
This section defines what the fund aims to achieve — for example, capital growth, income generation, or both.
(Example reference: Hong Leong Growth Fund Prospectus, dated 10 July 2025.)
2. Investment Strategy
Explains how the fund plans to achieve its objective. You’ll find details on the fund's investment policy, assets types, and allocation strategy across equities, bonds, or money-market instruments.
(Example reference: Hong Leong Value Fund Prospectus, dated 10 July 2025.)
- Risk Factors
Every investment carries some level of risk. The Prospectus outlines key risks — market, liquidity, and currency — to help you evaluate whether the fund matches your comfort level.
(Example reference: Hong Leong Master Prospectus, dated 10 July 2025.)
- Fees & Charges
Understanding the costs associated with an investment is essential. The Prospectus lists all relevant fees, including sales charge, annual management fee, trustee fee, and others — all disclosed per Securities Commission Malaysia guidelines.
(Example reference: Hong Leong Master Prospectus, dated 10 July 2025.)
- Shariah Compliance (When Applicable)
For Islamic funds, this section specifies Shariah guidelines, appointed advisers, and processes such as cleansing and zakat treatment.
(Example reference: Hong Leong Master Prospectus, dated 10 July 2025.)
- Performance Benchmark
The benchmark lets investors measure the fund’s performance against an index or market standard — for instance, comparing performance with the Malayan Banking Berhad 1-Year Fixed Deposit Rate or the MSCI AC Asia Pacific ex-Japan Index.
(Example reference: Hong Leong Regular Income Fund Prospectus, dated 10 July 2025.)
- Investor Suitability
Helps you assess whether the fund fits your financial goals, time horizon, and risk profile — for example, whether it’s designed for conservative, moderate, or aggressive investors.
(Example reference: Hong Leong Dana Al-Izdihar Prospectus, dated 10 July 2025.)
Why the Prospectus Matters
The Prospectus is more than just a regulatory requirement — it’s your roadmap to understanding a unit trust fund. Reviewing its helps you:
- Understand how your money is managed
- Identify the fund’s risk-return characteristics
- Compare funds with similar objectives
- Make confident, informed investment decisions
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