Question

Who are the potential investors of Amway (Malaysia) Holdings Berhad, Describe in terms of :

-income vs capital growth

-long vs short term

-informed vs uninformed

Make comparisons to other similar companies to substantiate your reasoning. For example, if you think the investor is looking for dividend income, the company must be paying more than other companies in the sector.

Answer 1

1. Income vs Capital Growth : If the investors are looking for periodic income, that is they are looking for dividends. In such cases investors should do research on company dividend payments in past and their growth rate in future. And they should study the Companies audited financial statements and do ratio analysis etc.

If the investors looking for Capital Growth then that means the market price of share price should increase. When they purchase shares at low price and sold at high price then they will get profits means capital gains on sale of shares.

2. Long Term investors are who have intention to hold shares more than one year and Short Term investors are who have intention to hold shares less than or equal to one year. Both long term and short term have their own advantages and disadvantages. Investors should consider Risks, Profits and Growth in future while investing in any company.

3. Uninformed investors means who have not aware of tax consequences on short or long term investments. Informed Investors are aware of tax consequenses on short or long term investments.

If any person wants to invest in Amway Holdings Berhad then they should consider above points while making decision.