CHAPTER ONE
INTRODUCTION

1.0 OVERVIEW
This paper intent to analyze the performance of Islamic equity unit trust funds’ in CIMB Wealth Advisors Berhad by comparing with the FTSE Bursa Malaysia Composite Index (KLCI) as benchmark. This chapter will discuss the background of the study, historical development of unit trust industry in Malaysia, understanding unit trust, problem statement, research objectives and the significance of the study.

1.1 BACKGROUND OF THE STUDY
A plenty of investments alternative can be seen nowadays. But it’s depends on people which alternative they prefer to invest or depend on their skills of investing in such instruments. Most of the people who are lack in financial knowledge or investing skills will prefer to make investments in unit trust funds. There has abundance of benefits in unit trust and also can be advantageous to the small investors. Unit trust is an ideal way for small investors to invest for their future. Small investors are people who earn their living engaged in activities not related to the financial arena. They are aware that investing is important to them, but they lack of know-how to make the right decisions. For people who are unable or unwilling to do research and analyze investment markets and climate on their own, unit trusts is a good way to invest.

In order to maintain a portfolio of stocks in the share market, a person has to keep himself up-to-date with market information and climate. For many people, this is difficult, time consuming and expensive. By investing through unit trust, they transfer the stress of investing to people who are better equipped to look after their investments. These are the professional fund manager.
Unit trust can be classified by two classes which are known as a conventional funds and Shariah funds (Islamic law as revealed in the Quran and Sunnah). In Malaysia, majority of