Hi Mr. Tan,
Your blog provides informative advice for financial planning. The contents are relevant in the Singapore context. I check out your blog daily as part of my online routine.
I invested some money in unit trusts through 2 local online distributors, i.e. finatiq.com and fundsupermart.com. By investing through these distributors, I only pay sales charge ranging from 2.25% and 2.5%. It is much lower than the fund sales charge by our local banks.
If, one day, the online distributor cease business operations. what will happen to my unit trust? Is there any regulations that protect the unit trust investors like the Deposit Insurance Scheme that protects bank depositors?
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REPLY:
Your money are kept with the unit trust manager and trustee. They are quite well protected and safe. They are not kept with the distributors.
The deposit insurance scheme is only for bank deposits. There is no similar arrangement for unit trusts.
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