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"KWAP achieved net ROI and TWRR of 10.04% and 11.64% respectively in 2009"
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Financial Highlights
 
The table below provides a snapshot of key financial indicators based on the fund's position since 31 December 2007. The table also illustrates and reflects the investment as well as operational strategies undertaken by KWAP throughout the past 3 years. The information provided is updated on a monthly basis. The June 2010 figures are unaudited and subject to future amendments.
 
  31 Dec 2007 31 Dec 2008 31 Dec 2009 30 June 2010
Fund Size (at cost) (RM) 48.08 Billion 52.04 Billion 61.50 Billion 66.33 Billion
Gross Realised Investment Income (RM) 3.44 Billion 2.98 Billion 3.24 Billion 1.89 Billion
Net Income (RM) 3.67 Billion 561.86 Million 5.70 Billion 1.90 Billion
Gross Return on Investment, Gross ROI (%) 9.21% 5.86% 5.62% 2.97%
Net Return on Investment, Net ROI (%) 9.79% 1.12% 10.04% 2.97%
Operating Expenditure (RM) 18.33 Million 28.17 Million 25.63 Million 13.17 Million
Total Contributions Received (RM) 2.47 Billion 3.42 Billion 3.77 Billion 1.94 Billion
Total Number of Contributing Employers 475 493 538 557
Total Number of Members 104,081 106,944 121,572 123,157
Total Number of KWAP's Employees 93 99 108 116
Income per Employee (RM) 39.99 Million 30.41 Million 30.33 Million 16.20 Million
Ratio of Operating Expenditure to Gross Income (%) 0.53% 0.95% 0.79% 0.70%
Ratio of Operating Expenditure to Average Fund (%) 0.04% 0.06% 0.05% 0.02%
 
 
Fund Growth 1991- 2010
Since the establishment of KWAP in 1991, the fund has grown 91 times in size. The growth was attributed to the contributions by the Federal Government, contributions by employers and accumulation of investment income over the years. As of at 30 June 2010, KWAP’s fund stood at RM66.33 billion (at cost).
FusionCharts
 
 
Investment Fund Allocation 2007 - 2009
Over the years, KWAP has adopted a prudent investment strategy with long-term investment objective. Besides growing the fund, KWAP acknowledges the risks associated in the management of the fund and therefore maintain a sound risk management framework. The distribution of fund reflects heavier weightage in fixed income instruments compared to the more volatile asset class which is in line with the long-term SAA (Strategic Asset Allocation) of KWAP.
 
FusionCharts
 
 
Gross Investment Income 2007 - 2009
As at 31 December 2009, the gross investment income of KWAP amounted to RM3.24 billion with equity as the largest contributor at RM1.41 billion. This is followed by fixed income namely Loans & PDS at RM0.86 billion, MGS at RM0.58 billion, money market at RM0.36 billion and the remainder is from alternative investments.
 
FusionCharts
 
 
Gross Return On Investment By Asset Class 2007 - 2009
By end of December 2009, KWAP recorded a Gross Return On Investment of 5.62% with the highest contributor being equity at 9.48%, followed by alternatives at 5.65% and Loans & PDS at 5.08%. Strong equity market performance had significantly enhanced the overall ROI achievement. Fixed-income instruments showed a fairly consistent ROI mainly due to smaller yield fluctuations.
 
FusionCharts
 
 
Net Return on Investment
Since the incorporation of KWAP (1st March 2007), the highest net ROI was 10.04% recorded in 2009.
 
 
Timer Weighted Rate of Return (TWRR) YTD December 2009
 
  TWRR
(%)
Benchmark
(%)
Outperformance/ (Underperformance) (%) Benchmark Name ROI
Equity

           Core
           Khas
39.37

45.83
6.96
44.91

44.91
NA

(5.54)

0.92



KLCI & FBM100*
9.48

10.66
4.04
MGS & GII 4.68 3.34 1.34 Quantshop MGS (ALL) Yield 4.68
PDS 5.37 4.46 0.91 Quantshop Corp (Medium) Yield 5.37
External Fixed Income 6.98 1.45 5.53 Quantshop MGS (ALL) Index + 130 bps 5.50
Loans 4.68 3.84 0.84 Quantshop MGS (ALL) Yield + 50 bps 4.68
Money Market 2.79 2.18 0.61 3-Months KLIBOR 2.79
*Benchmark is the blended daily return between KLCI Index and FBM100 Index.
 
Apart from measuring investment performance on an absolute basis (ROI), KWAP also measures the performance of each asset class relatively against benchmark indices (Total Return).

Total return for passively managed internal fixed income securities (comprising MGS, PDS, Loan and Money Market) are based on accrued basis with the securities valued at cost. Total return for internal and external managed equity is benchmarked against FTSE Bursa Malaysia KLCI (FBM KLCI). Externally managed fixed income total return is benchmarked against Quantshop MGS (All) Index plus 130 basis point as per the investment mandate.

As at 31 December 2009, the total return for actively managed equity was 45.83%, which has outperformed the benchmark by 0.92%. Total return for internal fixed income (MGS, PDS, Loans and Money Market) and external fixed income managers stood at 4.25% and 6.98% respectively. The total return for external fixed income as at 31 December 2009, on the other hand was 6.98%.
 
 
First Half of 2010 (1H 2010) Performance
 
  Investment Fund Size at Cost
(RM Billion)
Gross Income
(RM Million)
Gross ROI
(%)
  June 2010 June 2009 June 2010 June 2009 June 2010 June 2009
Equity 16.76 14.79 838.88 568.28 5.10 4.01
Loans & PDS 17.01 16.52 445.94 415.24 2.54 2.57
MGS & Quasi 19.60 13.27 391.03 300.67 2.28 2.57
Money Markets 12.13 11.76 154.34 199.40 1.30 1.54
Alternative 0.57 0.53 58.60 10.42 10.74 1.98
Total 66.07 56.87 1,888.79 1,494.01 2.97 2.69
 
Investment fund (at cost) as at 1H 2010 registered an increase by 16.18% or RM9.2 billion to RM66.07 billion from RM56.87 billion in the corresponding period in 2009.

As at 1H 2010, the gross investment income achieved was RM1.89 billion which is an increase of 26.42% or RM394.78 million against corresponding period in 2009. Equity investment contributed the largest proportion to the gross investment income of RM838.88 million.  This was followed by Loans and PDS at RM445.94 million, and MGS and Quasi at RM391.03 million.

KWAP recorded a gross ROI of 2.97% as at 1H 2010. Alternative investment recorded the highest gross ROI of 10.74%. Equity recorded the second highest gross ROI at 5.10% followed by Loan and PDS investment at 2.54%.
 
  TWRR
(%)
Benchmark
(%)
Outperformance/ (Underperformance)
(%)
Equity
            Core
            Khas

5.17
1.10

4.03
NA
1.14
MGS & Quasi 2.28 1.76 0.52
PDS 2.67 2.25 0.42
External Fixed Income 3.45 3.47 (0.02)
Loans 2.35 2.01 0.34
Money Market 1.30 1.25 0.05
 
As at 1H 2010, the total return for actively managed equity was 5.17%, which outperformed the benchmark by 1.14%. Total return for internal fixed income (MGS, PDS, Loans and Money Market) for the same period stood at 2.12% whilst External Fixed Income Managers was 3.45%.
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