Posted by calow1 > 2014-08-29 13:38 | Report Abuse

Plus one more advantage.. there is this free INVESTMENT week that icapital will provide once a year.. FREE to its investors to learn on investment...

Posted by sosfinance > 2014-08-29 13:51 | Report Abuse

I totally agree with your analysis. The issue is when will it catch up. Say, for a simpler analogy, share NAV is RM1.00 and the share price is RM0.80, which is exactly 20% discount.

1.If it takes one year to say catch up, your return is 20%.
2.if it takes 2 years to catch up, your average return is about 10% p.a.
3. if it takes 3 years to catch up, your average return is say, about 6%

They has been selling at discount for a couple of years. Of course, the share price did goes up over the years. Lets see the fact, in 2010 you can buy it at RM1.74 and today is RM2.44, you make a killing of RM0.70 or 40% in 3 years. That is not bad, the compounding return of 12%.

So, if you buy today, would the iCapital give you 12% p.a. for the NEXT 3 years, well, it is anybody's guess. Of course, if you FIND a company that provides an upside of MORE THAN 40% over the next 3 years, then you should allocate it to the other company.

Risk is pretty low now to buy iCap because of the 20% discount (theoretically this is not logical) but it is a FACT. If your HORIZON is very LONG TERM HORIZON, say more than 5 years, price will continue to go up disregard the gap is narrowed. But, like anything else, there is a RISK, best buy it over time.