What You Should Do:
- Only deal with intermediaries who are licensed and regulated within the jurisdiction where advice is given.
- Ensure all documentation is clear and explained in detail prior to signing any form of agreement.
- Always insist on copies of all signed and related paperwork, including application documents, terms of business, clarification of charges, risk/investment strategies and product technical specification/guide.
- Before placing business with an intermediary, please check the credentials of the companies, its management, fundamentals and recent announcements made by them. Also check the qualifications posted by the adviser who is working with you.
- Ensure investment strategies commensurate with your risk-bearing capacity as all investments carry some risk, the degree of which varies according to the investment strategy adopted. This should be verified by completing an investment risk-profiling document with your chosen intermediary and ensuring that the statement of advice is inline with your chosen risk tolerance.
- Be aware there are no guaranteed returns on investment in the stock market.
- Ensure that you have completed a financial position analysis with your intermediary to establish liquidity requirements, investment horizon and ability to fund the investment to the relevant maturity date
- Request regular updates and visibility to your portfolio holdings and ensure that you understand the diversification of asset allocation adopted to mitigate where possible against high investment risk.
What You Shouldn’t Do:
- Don’t execute any documents with any intermediary without fully understanding its terms and conditions particularly with regards to investment liquidity and product charges.
- Don’t deal with unregistered brokers / sub – brokers, or other unregistered intermediaries.
- Don’t fall prey to promises of guaranteed returns.
- Don’t look to encash existing policies without fully understanding the attributed penalties for early surrender and the benefit, if any to positioning a new investment using the dispersed funds.
- Don’t get misled by companies showing approvals / registrations from Government agencies as the approvals could be for certain other purposes and not for the securities you are buying.
- Don’t get carried away with advertisements about the financial performance of companies in print and electronic media.
- Don’t blindly imitate investment decisions of others who may have profited from their investment decisions.
- Don’t forgo obtaining all documents of transactions, in good faith, even from people whom you know.
- Don’t forget to take note of the risks involved in an investment.
- Don’t hesitate to approach concerned persons and then the appropriate authorities if you feel misled or service / visibility to investments is not provided.
- Don’t get swayed by promises of high returns and ensure that your goals and attitude towards risk/reward form the basis of your investment portfolio allocation.
“The biggest risk is not taking any risk. In a world that’s changing really quickly, the only strategy that is guaranteed to fail is not taking risks”
– MARK ZUCKERBERG –
