Mutual Funds

[CaRaMBa]

Please post anything and everything that you know about mutual funds. Seems like it's better to put your money here than in banks? aticus? KuyaDanny? Enlighten me please...

[batang uliran]

At this point, the best and safest place to put your money in is in US blue chip companies - either via mutual funds that invest in these companies or by buying the stock directly - these are companies like Ford, GM, Dupont, Alcoa, Eastman Kodak, AT&T, Black and Decker etc. that are very undervalued because of the emphasis on tech stocks during the past few years. Many of these companies are trading at P/E (ratio of a company's price per share to earnings per share - lower numbers better) ratios less than 10. If you have a little bit more appetite for risk, buying mutual funds that invest primarily in the korean and singaporean stock markets is also a good bet since these markets are significantly depressed for the year and are sure to rebound in the next 1 to 2 years.

[aticus]

* For the benefit of our non-working/non-financially-oriented friends in PEx*

The principle of mutual funds is that people/groups with limited funds can pool resources and take advantage of some investments that would otherwise be unavailable to them, due to either a lack of funds, or due to preferential rates made available only to larger investments.

A simplistic analogy might be the following:

Bank A gives, say, 8% interest per annum for Time-Deposits under 100,000, but 10.5% for those 100,000 and above.

If you and your brother each had 50,000, it would make sense to pool your money so you can both take advantage of the higher return. Instead of earning 4,000 (8% of P50T), you would each make 5,250 (10.5% of P100T divided by two).
Not too bad.

Now obviously real mutual funds involve much larger amounts, have many investors, and are managed full-time by large financial institutions and professional fund managers.
They are attractive due to the returns they generate (some of the most successful can grow over 100% or even 200% over a span of just a few years, clearly outpacing your bank time-deposit rates.

What people have to be aware of, though, is that mutual funds DO NOT GUARANTEE returns. While there is a good chance you can make a lot, there is always the possibility you will lose your money, or at least a large chunk of it.
Please don't take part in mutual funds until you're well aware of the market, where your money is being invested, your risk level, and whether or not you can trust the company or persons managing the fund.

As in life, no risk, little gain... :)

Caveat emptor. Buyer beware.

[CaRaMBa]

Hey thanks you two! :)

[xyzseaman]

Kung medyo bata-bata ka pa, use high risk (that's what I chose, by the way)...kung di maganda ang kinalabasan, makakarecover ka agad. Pero kung medyo may edad ka na, medium to low level na lang.

You can use Savings Bonds too..uh, wait. Oops, hehe, wag na lang kasi medyo bumaba ang interest rate ngayon eh....

[joelsher]

Thanks

[insomniac]

Aticus: Thanks for a very informative post :). And for enlightening us "non-financially-oriented friends in PEx" :lol:

Can I ask your opinion on something about mutual funds? It's something that I've been thinking about for awhile. I've been wondering where to put some of my money, and my mom has been telling me that mutual funds are the way to go. I've made an initial investment already, though I think it's based on the local market. Anyways, she says now is the time to invest more because stocks are down, and the ratios are low. And though there is a risk, there's a bigger chance that the fund's value per share will rise in the long term. Do you agree?

batang uliran: Given the Philippine market's current significantly depressed state,(especially with ongoing turn of events), does that same principle of rebounding apply?

Sorry, if I seem so clueless, one thing I never took up in college was Finance, now I kinda wish I took an elective or something :(

[batang uliran]

The principle of rebounding applies if and when Erap leaves. Much of the recent downturn in Philippine stock prices has been due to political uncertainty and total lack of confidence in Erap. When that changes, expect a more than modest rebound.

[Dogberto]

Well, even if Erap leaves, the chances for a big rebound are still uncertain. We still have to grapple with who the next leader will be and how the change of leadership can be effected. If its through peaceful means, then it will take a long time before that happens (what with all the hearings, investigations, etc.) so your investment will sleep for quite some time :zzz: But if it would be through violent means, expect a real rocky ride! :silly:

[aticus]

insomniac:

Mutual funds, by nature, require a long-term commitment to the investment. Because you are investing with a group of other investors, you don't have the flexibility that individual investments or placements would give you. You also have to trust the judgement of the fund managers managing the fund for you. If they decide, for the greater good, that they should limit their exposure or investments in certain areas, and increase in others, then you have to go with the flow. If you don't like how the fund is being managed, then you shouldn't have joined it in the first place.

So to answer your question, yes, stocks are down and P/E ratios are almost ridiculously low, so if you're in it for the long-haul, then you stand a good chance of making a lot more money. Imagine, for instance, being able to buy San Miguel shares at the trading level right after the EDSA revolution. You would have made quite a bit by now... :)

But that said, I wouldn't invest in stocks here. There's too much danger and uncertainty. At the rate the economy is going, some companies currently traded could close shop, and then you'd only be left holding pieces of paper which signify your stock in a bankrupt corporation. Even large companies like Smart are heavily in debt. If the peso slips further, you could see some major restructuring. The very least that could happen is they will have problems generating solid profits for the next year or two. Your money could be making more money from Mutual funds based in other nations/regions. It's one thing to say you're looking at the long-term. It's another to see your money being valued less and less because you've invested in Philippine stocks. No serious financial institution in the world wants to have major exposure in the Philippine market, for obvious reasons.

I'd look at more mature markets like Hong Kong or even Singapore, if you want to stay in the region, or some blue chips on Wall Street, if you want to go global.

Whatever you decide, I wish you luck!

[badoods]

aticus: If i don't intend to continue my participation in MF how much will i get or can they give me the total amount written on my certificate? i know there are fees to be deducted...:confused:

[aticus]

badoods:

Different mutual funds each have their own terms and conditions. I suppose now might be too late to tell you to make sure what those are? :) You really must find these things out BEFORE you get into any mutual fund.

I think, though, that the model you're using is the one banks have for time-deposits, where they would charge particular fees for early termination. Believe it or not, there are mutual funds that wouldn't charge you at all for leaving. This is more in the nature of a stock market, after all, rather than a bank. Kuya Danny can give you more examples...

But the best thing to do is to be vigilant regarding ALL the terms and conditions of any financial endeavor you get into. Anything that may affect your hard-earned cash should be very carefully assessed.

[Kamatayan]

I agree with BU better stick with blue chips rather than mutual funds, the Dow Jones Average (composed mostly of Blue Chips Stocks) has consistently beaten 80+% of the mutual funds out there (I'm not sure about the statistics here in the Phils though)... With a mutual fund however you could probably double or triple your money, which highly unlikely with Blue Chips...

Also, I wouldn't recommend that you invest in stocks here in the Phils, growth is just ohh-soo-slow... Now if you're a risk taker then maybe you can invest on those internet stocks (although not in favor right now) or stocks of companies in which sectors are deemed as hot...

[cianoy]

A good variant of mutual funds is what is called index funds. In this setup, basically the fund is diversified enough to represent the index. In this way, risks are minimized and costly salaries to fund managers are avoided.

But I agree, not in the Philippines.

[Bogshot]

Judging by the returns from local Mutual Funds published on BWorld, youre probably better off with a LT Bank Deposit the way the stock market is performing nowadays...

[eepis]

Vanguard S&P 500 Index fund is a good mutual fund. http://www.vanguard.com

It invests in the 500 stocks that make up the Standard and Poor's 500 Index Fund. the blue chip stocks.

The expense fees are really low too compared to other mutual funds that charge a load fee of 3% a year.

The return is around 24.9% a year. That's off the top of my head, but goto the site and you'll see the numbers.

If you don't have access to the mutual funds that there are SPDRs (Spiders). They are the same thing as the S&P 500 index but they sell as individual stocks.

[Lightspeed]

Can Philippine-based investors put some money in international mutual funds using the Internet? I agree that the mutual fund industry in the Philippines is quite small and add to that the unstable nature of the Philippine political and economic situation makes investing in the Philippine stock market quite scary.

I wonder if some international mutual fund companies accept placements over the internet using credit cards. That way, we can increase and diversify our respective portfolios.

I am interested in some regional stocks, i.e. Hong Kong and Singapore stocks, and some US blue chips (don't know about clicks-and-mortar stocks, though).

Not that I have sufficient money to invest, but I want to know my options just in case I need to find places to park my funds.

[eepis]

I'm pretty sure mutual fund companies in the U.S don't take credit card. My friends in the U.S pretty much deposit their money by sending checks to the mutual fund companies.

[KuyaDanny]

Figures represent % change in net asset value between 12/31/99 and 12/31/00

Equity Funds
Philequity +6.93
Sun Life Prosperity Phil Equity* -9.33
Philam Strategic Growth Fund -15.10
Filipino Fund -17.00
Abacus Growth Fund -20.23
United Fund -32.80

Balanced Funds
Far East Fund +7.50
First Galleon +3.48
ECC Growth & Income Fund +1.43
Sun Life Prosperity Balanced* -2.46
Philam Fund -11.50
All Asia Fund -11.57
Citisec Growth & Income -17.03
MFCP Kabuhayan -23.93
GSIS Kinabukasan -25.93

Bond Funds
All Asia Fixed Income +9.38
Philam Bond Fund +8.91
Ayala Life Fixed Income +8.64
Sun Life Prosperity Bond* +6.26

*Started operations on 04/05/00

[Triglyceride]

hope this'll help somehow..

Mutual Fund companies are firms which pool deposits by customers to purchase stocks or bonds (or both). These share holders or bond holders are people who own a part of a particular set of stocks or bonds, say a growth fund or bonds issued by state governments such as municipal bond fund. Fidelity, Putnam,Drefus, and Kemper are examples of Mutual Fund companies.

[Triglyceride]

Kuya Danny or Aticus,do we have Mutual Fund firms in the Philippines? Plus, who is the Philippine's Alan Greenspan? Do we have such a person? I've been wanting to ask that for the longest time:D.

...Most companies have a family of funds-- separate funds with different objectives under the same roof. For each fund, there is a manager or group of managers who take charge of that funds portfolio.

Funds have expenses and fees--fully disclosed in the prospectus. They need to pay those stockbrokers and financial managers you know:). Funds who charge their clients are called "load funds". There are front end and back end loads. Front end loads, we buy in at the offering price. This offering price however is higher than the funds net asset value per share (NAV). So for example, with front end load, it'll say that the price of the fund is..maybe 15 and the NAV is 14.50 but because of that 'load', you get to buy it for 15. Some funds have a redemption fee that last for a specified time period --these are the back end load funds. Redemption fee discourages investors from buying into a fund and selling after a short hold. On the other hand,there are companies who doesn't charge you at all. Just call the company, get an application, send a check and invest. Performances between loads and no loads funds shows no distinction whatsoever...so these load funds, they are in some ways a rip off....kinda. It's like choosing between two apples. One cost a dollar, the other 1.05. You buy the 1.05 one because the 'vendor' charged you a 5-cent "handing-out-the-apple-fee":D. With no load funds though, you have to do your own research to monitor the funds performance. What load funds pay their brokers and reps, no load funds spends their profits in advertising.

Mutual funds past performance have to be looked up before we invest--as far as 10 years back. Although MF infos can be found in publications like Money,Business week, Wall Street Journal etc..most of them are biased in printing their articles and studies because they recieve huge adverstising revenues from many fund companies.

Most mutual fund families have Money Market Funds, Income funds, Growth and Income funds and Growth funds. Many have Global funds that invest worldwide and there are also Specialty funds.

Money Market funds(Liquidity with highest personal yield)-> buy short term investments such as treasury bills, certificates or deposits...commercial paper issued by corporations. Their interest rate changes daily.

Income funds buy blue chips stocks, bonds and money market investments..

Growth Funds buy common growth stocks...balanced funds buy common stock, preferred stocks and bonds.

They say that the best time to invest is when the share price is "low". But with the markets fluctuating nature,it's hard to determine when a price is "low". If the market took a dive after a purchase, the value of your investments will drop. If you buy at a low price, you get to buy more shares. Some reduce the risk of buying high by a method called Dollar Cost averaging--that is buying shares at various market prices.

While some MF are 'managed funds', meaning, the funds money is invested according to the tastes, intuitions and analysis of the manager, index funds (another type of mutual fund) are generally done by computer programs designed to mimic a performance of a given stock market index.Stock market indices is a measurement of a funds performance...kinda like your GPA to measure your academic performance. Analyst then based their decisions in this measurement. If we want to have a good representative sample of how the market is performing on the average, Standard and Poors 500 Index is the benchmark of stock market performance. S&P Index are the 500 largest companies in the market. Another 'brainless' and respectable choice would be The Vanguard Index Trust 500 Portfolio. It's a mutual fund that just mimicks the market performance, software-driven therefore the management fees are very low. There is a minimum fee for a Vanguard Fund though....I don't remember how much...I think it's around $4000)?), I'm not sure:D.

SHOW ME THE MONEY!!!!:D

[kamehameha]

Triglyceride, are you really talking about a $4K fee or are you referring to the minimum initial investment for a regular account?
If you're referring to the 2nd one, I think it is just $3K for most of the funds I've looked at so far including one of Forbes' Best Buy fund choices, Vanguard 500 Index Fund.

(Off-topic) Has anybody else seen the list of billionaires from Forbes magazine? FYI, we have three billionaires from the Philippines:
Henry Sy - $1.3 (237th in the list)
Lucio Tan - $1.2
Jaime Zobel de Ayala - $1.2

Bill Gates is still on top. His worth = $56 (or 58) billion.

[DivineFist]

* bump *

A new year is about to begin and I'm curious about mutual funds as a good investment to begin the year right. I have shopped around for TD rates, and the highest that I have found ranges for 7% - 8.6%. A mutual fund that has returns higher than this would be great (I'm willing to take the risk.......) Any good local mutual funds that I could use and what is their initial investment to begin an account with???

I'm not sure if could use international mutual funds if we are here in the Philippines????

:glee: :glee: :glee:

[mac_bolan00]

here's an alternative financing strategy: the scrooge method.

requirements:

1. keep a steady job even if it pays only minimum wage. choose your office location carefully. the closer to your house, the better. if it's accessible via passenger jeep, so much the better.

2. keep a time deposit account

3. don't eat in restaurants, don't watch movies, don't go to concerts, decline all invitations from friends to go to commercial establishments, don't smoke, don't drink. for recreation, read books in the library.

4. follow a cheap but nutritious diet. take vitamins. excercise.

5. convert your home phone to teletipid.

6. discontinue your newspaper subscription. watch tv, listen to the radio, use the internet in your office.

7. get rid of that blanketty-blank-blanking cellular phone. it's only use is telling others you're running late to a meeting for whatever reason. it doesn't improve your productivity.

8. if you're married, make sure you have insurance and an HMO account. this is an important expense.

saving strategy:

1. make sure you can set aside at least 1/6 of your quincenal take-home pay into your time deposit account. since you're paid every 15 days, maintain two TD accounts. one matures on the 15th, the other on the 30th.

2. keep an envelope hidden in your office desk. drop at least 10 pesos from your spare change into it every working day. just let it grow. it will be your emergency money.

desired result:

you'll die unpopular, un-noticed by most people and, to their minds, destitute. your relatives and heirs will therefore be surprised when they receive a letter from your bank informing them that you left close to two million bucks accumulated over three decades of scrimping.

[raven23]

Originally posted by DivineFist
A new year is about to begin and I'm curious about mutual funds as a good investment to begin the year right. I have shopped around for TD rates, and the highest that I have found ranges for 7% - 8.6%. A mutual fund that has returns higher than this would be great (I'm willing to take the risk.......)There is only one principle I follow when it comes to investment -- and that is

Diversify your assets.

High risk = high return.

But if you're a bread-winner, or, given the uncertainty of times, one can't afford having all one's assets in high-risk instruments.

Stability = low return.

But then again, if all you do is keep your money in the bank, then you're basically robbing yourself of the opportunity to make it grow by prudent investment.

So, keep a good mixture of investments. But, not all of us have the time and the know-how on how to take care of our investments. Finally, not all of us have access to large amounts of capital needed for certain investments.

Ergo, we invest in mutual-funds, where we let professional fund-managers pool our money and invest it in diverse stocks.

Then, keep some money liquid in savings / checking deposits, some money in "inflation beating" instruments such as real estate, and some money in "growth" investments such as a business.

[raven23]

Originally posted by mac_bolan00
here's an alternative financing strategy: the scrooge method.
Hah hah! Mayaman ka nga, miserable ka naman.

Huwag na lang, oy! Magpapakasaya na lang ako.

You can't take your money to the grave, you know? :)

[racho]

Ahhh hahahahaah.. Scrooge method. 2 million lang after 30 years? Be a scrooge, but don't remain on minimum wage. You might get 2 million after 5 years.

And just to add to that strategy. Get as many pension plans and life insurance as you can afford. (Which is also a good thing to get with any strategy.)


6400aday@GetResponse.com

[JDELEON]

A few thoughts.

First, I respectfully disagree with Racho's advice of loading up on pension plans and life insurance. Life insurance only really pays off when you die, it should not be treated as an investment vehicle equivalent to a mutual fund. If you consistently put the money you would pay to an insurance company into a market tracking mutual fund, and assuming the market continues its long-term upward trend, then you should come out ahead. The benefit of a pension plans and life insurance plans with pay-outs is that it is easy to consider that money "spent" and when it comes back to you, it "feels" like you made money. Unfortunately, the ones who "actually" make money are the insurance firms.

While my concentration is not in Finance, here is some advice Warren Buffett gave in a talk at Emory University this past December 20. Forgive me, but I shall be paraphrasing...
"invest in what you know... if you don't have the time or inclination to research a business, invest in mutual funds." Not all of us can be as wealthy as Mr. Buffett; but we can be relatively wealthy over the long-term if we invest in the market.

On P/E Ratios, please note that there is more than one way to analyze a stock. PE Ratios are extremely popular because they are simple but that does not mean that they are the most apt for all potential investments. In the latest issue of Red Herring, there is a more robust discussion on which valuation method is better suited for a particular kind of company/industry. (Sorry, left my copy in Atlanta; but the December 2001 article should be available in the Red Herring Archives next month.)

Finally, an alternative to investing in mutual funds is still investing in various index funds. QQQ tracks the NASDAQ, SPY tracks the S&P.

If I am not mistaken, finance theory would bear out that even if there were an extraordinary investor/ fund manager who could consistently beat the market, the cost advantage would eventually be nil. That is if some dude figures out how to game the market, and that guy works for an I-Bank and is not you, the premium you end up paying for his insight will effectively eliminate the above average return achieved.

May Angels smile upon you,
Joe

[mac_bolan00]

Originally posted by raven23
Hah hah! Mayaman ka nga, miserable ka naman.

Huwag na lang, oy! Magpapakasaya na lang ako.

You can't take your money to the grave, you know? :)
this is no joke, peeps. you should stop believing you're working to gain leisure time on top of your basic requirements. i know it's a drab life but what is life itself? the human cycle is simply birth, education, work, death. everything else is illusory. where does surplus wealth come into the picture? to help others who lack even just the basics.

in short, excess cash is saved for others, not spent for one's enjoyment.

[Art Vandelay]

Originally posted by JDELEON
If I am not mistaken, finance theory would bear out that even if there were an extraordinary investor/ fund manager who could consistently beat the market, the cost advantage would eventually be nil. That is if some dude figures out how to game the market, and that guy works for an I-Bank and is not you, the premium you end up paying for his insight will effectively eliminate the above average return achieved.


Ah but there is a guy who has beaten the market consistently and has given his investors their money's worth many times over - Warren Buffett. Though with the way that Buffett works he probably just has as low an overhead as the index funds since he doesn't have much in manpower nor does he trade a lot prefering to hold on the long term. Presently though Berkshire Hathaway is technically not a mutual fund it functions very similarly to a mutual fund (there are actually some mutual funds out there that just mimic Berkshire's investments)...

[raven23]

Originally posted by mac_bolan00
the human cycle is simply birth, education, work, death. everything else is illusory.Hah hah.

No joke, but tell that to the Realm of Thought peeps.

There is more to life than making money, you know.

I always somehow knew, deep down inside, making money is easy. Work hard, be smart, buy less, invest more.

Knowing how to spend money, now that's something else.

(Note: I'm not rich. Far from it. Simply because I don't see what the difference is between having $10M dollars and $100M dollars in the bank. I'd rather go sky-diving, or scuba-diving, or making my sister/significant other happy.)

[mac_bolan00]

realm of thought? don't remind me. the devil impersonator's back.

my formula does remind people there's more to life than just making money. furthermore, it teaches them how to avoid the trivial and silly aspects of life. read what you just posted.

and people, if you think you can hold on to a stock for more than a year just because you think you understand things like P:E, NAV, dividend discounting, beta analysis, relative strength index, etc., etc., and expect a gain, think again. you wouldn't want to end up decorating the pavement underneath your 20th floor office, would you?

[Spyfrat]

most investors thought kapag nakabasa na sila nang books about investing, much more galing sa merika ay okay na mag invest. much more kung about greenspan, buffet, lynch at iba pa. hmmmmm i dont know but honestly speaking d mo yan magagamit once nag invest ka na lalo na sa philippine market. we're a small market yet not transparent. i think hindi effective ** and pe pe ratio. much more fundamental analysis. the ones na kumikita ** sa atin are traders who doesnt marry their stock and who uses technical analysis well. stock market is ruthless kaya dapat no emotions involve. i dont believe in mutual funds. most equity funds here are in negative territory magkakamot ka nang ulo considering na those people who managing such funds are well versed sa ganyang trabaho. just imagine the education they have, pero kumikita ba?
although may isang fund na bilib ako, yung phil equity fund. manage i think by wilson sy.

[lupuS]

How much did Wilson Sy's fund earn in 2001?

[Spyfrat]

http://www.inq7money.net/mutual/netasset.asp

[ching]

I thought I spotted a couple of questions in this thread that haven't really answered been clearly:

1. Is it possible to invest in international (e.g. US-based) mutual funds from Manila?

2. How?

(I'm interested in the answers myself, so I hope someone will pick these up and post a response we can follow!)

Ching

[Art Vandelay]

Originally posted by ching
1. Is it possible to invest in international (e.g. US-based) mutual funds from Manila?

Yes


2. How?


I'm sure that some local brokerage here can do that for you but I'd recommend you go with the web based traders. Try datek.com - it will probably cost lower and you'd be in better control of your funds - no need to instruct your trader to do this or that you can do it yourself...

[Spyfrat]

kahit saang parte nang mundo kung meron internet ay pd. tulad nang sabi ni art pwedeng pwede sa mga online brokers.

https://trading.etrade.com/cgi-bin/gx.cgi/AppLogic+MFCenter

[woofers]

I have a little bit of money saved up, and am budgeting around P10k-P20k a month to either save or invest for retirement. I've been reading about mutual funds as a way to get started investing for the long term.

From the MCFP's page at http://www.mutualfund.com.ph and Sun Life's page at http://www.sunlife.com.ph/mutualfunds/default.asp, mutual funds seem like a good choice. Are there any gotchas I have to be aware of? Is anyone else here planning on investing in mutual funds?

[TrashBox]

I think mutual funds are a good investment option for the money is handled by professional and experienced money managers and investment companies like Sunlife is among the best.

The only thing is, you have to leave your money in the fund for a long time, say 5-10 years, to reap the full benefits a mutual fund can offer.

in short, you just have to have a long-term investment plan.

since you are already planning for a retirement fund, i think mutual funds are one of the best investment options

[Hulk]

First of all you have to understand what type of mutual funds you're investing in. There are two types, they are: open-ended and close-ended.

Open-ended mutual funds are funds which readily accept investments from investors by issuing shares of the fund. There is no limit as to the number of shares that the mutual fund could issue. If the investor wanted his money back, he should redeem his shares from the mutual fund. Because of its nature, there are normally lock-up periods for these type of mutual funds.

Another important thing to note in these type of investments is your counter-party, since you could only get your money from them. These mutual funds are also not monitored by any independent body except for the SEC (sorry pero masyadong maraming ginagawa ang SEC to properly monitor investment companies). This is unlike banks where you have the BSP or insurance companies where you have the insurance commission.

Close-ended mutual funds are closed once issued, meaning the issuer cannot accept more investments by issuing new shares. The only way for an investor to invest in it is via the PSE where the shares are listed. Since it is listed in the stock exchange, closed-ended funds are more liquid than open-ended funds. Obviously since they are listed companies, the SEC and the PSE monitors these companies. An example of this is the First Filipino Fund.

Yun muna. Tanong ka na lang uli.

:frank:

[pinbox]

question pala about mutual funds...

how will the historic low T bill rates affect the funds?

:confused:

[Hulk]

Originally posted by pinbox
question pala about mutual funds...

how will the historic low T bill rates affect the funds?

:confused:

It depends on what kind of fund we are talking about. In the Philippines, there are three types of mutual funds in terms of the instruments they invest on. They are:

Aggressive - a large part of the portfolio are invested in stocks
Balanced - almost equal amounts are invested in stocks and fixed-income instruments
Conservative - a large portion of the portfolio are invested in fixed-income instruments

Of course in other more advanced countries, mutual funds are differentiated in terms of investment style which is more specific than the three mentioned above. Anyway we won't talk about foreign funds as it would require another long discussion.

Going back to the topic, if the fund invests heavily on fixed-income instruments, it is strongly possible that most of their investments are in the short-end of the curve (treasury bills to 2 yr. fxtns). I haven't met any institution aside from banks and life insurance companies, who actively trade the long-end (i.e 5yrs. to 20 yrs.) of the curve. If this is true, then these type of funds will have a lower yield compared to previous years' performances. Note that I compared the performance historically and not to other types of funds whose performance are dictated by the stock market.

On the other hand, a continuing drop in interest rates is normally a good thing for fixed-income traders. Here's where you really make big money. Most fixed-income desks have probably have hit their budgets for 2002 as early as now. However, I strongly doubt that mutual fund managers behave as fixed-income traders do.

The technique in trading fixed-income instruments is to buy longer-dated instruments, or rather to buy instruments with higher durations when interest rates go down. Conversely, investors should buy instruments with shorter durations when interest rates go up.

Lastly, lower T-bill rates would also mean lower benchmarks for some funds who use the Tbill yield curve as their benchmark. Lower benchmarks brings about a better performance comparatively, but not necessarily in absolute terms.


Hope that helps.


:frank:

[Mymnosene]

should anyone be interested in investing in mutual funds or at least receiving a non-commital free demo, PM me....

Finally found my calling as a sales consultant for Sun Life Asset Management Co..... :D

(hehehehe...plugging ever...sorry to interrupt....)

[pinbox]

aha! :D so that's why you were here sa office namin! :p

niway may suki na ako eh.... :beam:



Hulk i had to read your post twice kasi medyo too technical for pinbox. :glee: i think i have to read it ulit for the last time bago ako magtanong ulit. :cheese: im into bond funds by the way.

[Hulk]

Originally posted by pinbox


Hulk i had to read your post twice kasi medyo too technical for pinbox. :glee: i think i have to read it ulit for the last time bago ako magtanong ulit. :cheese: im into bond funds by the way.

Ok lang. Don't hesitate to ask kung may portions medyo malabo for you. I promise to make it more simple next time.


:frank:

[Hulk]

Originally posted by Mymnosene
should anyone be interested in investing in mutual funds or at least receiving a non-commital free demo, PM me....

Finally found my calling as a sales consultant for Sun Life Asset Management Co..... :D

(hehehehe...plugging ever...sorry to interrupt....)

Does Sun Life share one asset/portfolio management team with all their affiliates? Sun Life has one of the most impressive fund management teams. I have met some of them and they are really good. *okay*

O ayan tinutulungan na kitang mag-plug. :D

:frank:

[Mymnosene]

Originally posted by Hulk

Does Sun Life share one asset/portfolio management team with all their affiliates? Sun Life has one of the most impressive fund management teams. I have met some of them and they are really good. *okay*

O ayan tinutulungan na kitang mag-plug. :D

:frank: thank you, hulk! I think I need to start a new thread na nga, e...under classifieds, kasi not many people return to this thread na. :)

Uy, you know what? It was your advice on investments, together with riachyuppie's and raven's, that got me interested in this. So far so fun. LOVE YAH, mentor!

[Hulk]

Originally posted by Mymnosene
thank you, hulk! I think I need to start a new thread na nga, e...under classifieds, kasi not many people return to this thread na. :)

Uy, you know what? It was your advice on investments, together with riachyuppie's and raven's, that got me interested in this. So far so fun. LOVE YAH, mentor!

Maraming salamat. Actually binabayaran lang kami ng PEx to make some topics interesting. :lol:


:frank:

[Ottersmart11]

:hmm: hmmm...forgive my ignorance and slowness, but can you please explain to me how Mutual Funds work, IN a very insulting terms, layman's terms, and tagalog please :bookworm2: I know this is very embarassing but please I beg you, this isn't my line kasi e. I am into dancing, making me some pretty, blondy dancer....

:beauty:


:D

[DivineFist]

Originally posted by Mymnosene
thank you, hulk! I think I need to start a new thread na nga, e...under classifieds, kasi not many people return to this thread na. :)

Uy, you know what? It was your advice on investments, together with riachyuppie's and raven's, that got me interested in this. So far so fun. LOVE YAH, mentor!

Check your PM please, Mymnosene. I'm very interested with SunLife's Prosperity Funds.


:glee: :glee: :glee:

[thehitman]

*bump*

I'm probably as ignorant as Ottersmart11.

:cool:

[KuyaDanny]

Originally posted by Ottersmart11
:hmm: hmmm...forgive my ignorance and slowness, but can you please explain to me how Mutual Funds work, IN a very insulting terms, layman's terms, and tagalog please


Sige subukan natin.

Halimbawa marami tayong tao at lahat tayo may pera na gusto nating pakitain. Problema lang hindi natin hilig yang stock market, money market, o kahit na anong market. Masyadong magulo para sa atin.

Tapos merong fund manager na matinik tulad nina Hulk na mahilig sa mga market na yan pero wala naman silang pera. (Sorry, Hulk). Ang gagawin ng fund manager, magtatayo siya ng mutual fund at aanyayahan kayong mga may datong na ipagkatiwala sa kanya ang inyong kwarta. Lahat kayo magiging parte ng mutual fund ni Hulk at si Hulk ang mamamahala ng pagpapalago ng pera ninyo. Bibili siya ng stocks, bonds, deposit, dollar, tilapya, o baboy, kung mura. Mangga na rin lalo na ngayong tag-init minsan P30 lang isang kilo. :lol:

(Pagpasensiyahan nyo na yung huling hirit na yon.)

Minsan makakabuti sa inyong lahat na si Hulk ang kumikilos para sa inyo dahil makikinabang kayo sa kanyang kaalaman. At dahil maraming pera ang hawak ni Hulk, makakahuha siya ng magagandang presyo pag nakipag-usap siya sa mga bangko, atbp kung saan ilalagay ang pera ninyo. Sana masipag din yang si Hulk para siya na ang mag-iisip para sa inyo. Kayo pwedeng pasayaw-sayaw na lang muna diyan. :) Kung ano ang kikitain ni Hulk sa pagbibili at pagbebenta ng mga stocks, atbp, yun ang kita ninyong mga may-ari ng mutual fund. Kung talagang matinik si Hulk, yayaman kayo dahil tataas ang halaga ng parte ninyo sa mutual fund. Kung medyo minamalas si Hulk, malulugi kayo at pwede ninyo siya sigurong habulin ng itak.

Pwede na ba yung introduction na yan?

[Hulk]

Wow! Tiyaga mong magsulat sa Tagalog. I would probably have difficulties in translating certain terms like "long-term assets." :lol:


:frank:

[thehitman]

KD :handsdown:

So in essence, everything depends on the one who will handle the fund. And there is no guarantee that it will indeed give us positive returns. The, umm, profit we will get from mutual funds will only be as much as what the fund manager can get in the course of his use of the fund. So, is this really better than time deposits? Time deposits have low returns, but at least those returns are guaranteed. As for mutual funds, there appears to be no way to predict it's profitability. What's the worst thing that can happen to me if I invest in mutual funds?

:cool:

[KuyaDanny]

thehitman: :handsdown: to you, too. You learn quickly.

The fund manager's role is very important, but you should also look at the fund's objective/strategy/asset allocation. A fund manager can only work within the fund's guidelines. So he cannot buy stocks, for example, if the mutual fund he manages is intended to invest only in bonds. He would be fired if he violated the rules.


The, umm, profit we will get from mutual funds will only be as much as what the fund manager can get in the course of his use of the fund.


It will actually be less, because the fund usually pays the manager a fee, and there might be charges when you enter or leave the fund.


So, is this really better than time deposits?


Depends on what you mean by better. For a time (several years ago), US technology mutual funds were out-earning time deposits. That's not true anymore.


What's the worst thing that can happen to me if I invest in mutual funds?


I won't lie to you. It is possible for you to lose your entire investment.

Now that this thread is alive again, the heavyweights may come in and rejoin the discussion. ;)

[thehitman]

Originally posted by KuyaDanny
I won't lie to you. It is possible for you to lose your entire investment.



Ack! This is just as risky as stocks and forex!

I've seen some names of companies here and in some related threads, names like Sun Life, ManuLife, Philam, etc. Where would my investment be "safest" (if the term exists in this world of mutual funds), based on the latest performance of the companies in relation to mutual funds?

**off-topic**

Just want to share the sad experience of my friend. He invested $5000 in forex, and his broker was dealing with the Swiss currency. He became very excited because his broker informed him that he had already gained an additional $2500 in two months. Alas, something went wrong, and his entire $7500 is gone now. The only good thing was that the $5000 investment was his excess cash. Who knows what would have happened if that $5000 was his life's savings? I'd rather not think about it.

:cool:

[Hulk]

Originally posted by thehitman
KD :handsdown:

So in essence, everything depends on the one who will handle the fund. And there is no guarantee that it will indeed give us positive returns. The, umm, profit we will get from mutual funds will only be as much as what the fund manager can get in the course of his use of the fund. So, is this really better than time deposits? Time deposits have low returns, but at least those returns are guaranteed. As for mutual funds, there appears to be no way to predict it's profitability. What's the worst thing that can happen to me if I invest in mutual funds?

:cool:

Yes. The performance of the fund depends on the fund manager.

Is it better than time deposits? In terms of risk, perhaps it's better, but in other areas, not really.

Each investor is unique in their own right, this is what I always try to preach to others. For risk-averse investors, time deposits may be the thing for them, however, risk is only one consideration in making investments. The other things to consider are:

1. Return - the investor might not be satisfied with the return a time deposit will net you. Currently a time deposit will net you around 2%... if you're lucky! So if you prefer a more aggressive fund that can give you more access to investments not readily available to small investors (i.e. foreign-currency denominated investments), then mutual funds are for you.

2. Liquidity - you might not believe it but sometimes mutual funds are more liquid. Some funds are close ended and are therefore listed in the stock exchange. If ever you need cash, you could simply sell your shares in the open market. With time deposits, you would be forced to swallow pre-termination penalties.

3. Taxation - Time deposits are subject to a final witholding tax of 20%. Taxes for gains in the stock market (for close-ended funds) are much, much smaller than this.

4. Risk - I would like to discuss a loittle more about risk. With the variety of available mutual funds, you could choose a fund that suits your risk appetite. For young people, it's always advisable to take a higher amount of risk than older people since you can recoup it with your earnings. But if you're really risk-averse, government securities are actually better than time deposits.

How much can you lose? It really depends on the fund. Some funds are principal protected, so at the very least, you get your principal back. For some funds you could indeed lose your entire investment.

Of course there are fees involved in some mutual funds. The norm locally is 1/4 of 1%. Internationally, the fee shoots up to 1% of your total portfolio plus a participation in profits if the performance of the fund has breached certain benchmarks.

You must remember than fund managers are professionals... or at least they pretend to be. The key is in choosing a company or someone you are comfortable with, someone who will not tell you BS just to get your business.


:frank:

[thehitman]

Originally posted by Hulk

How much can you lose? It really depends on the fund. Some funds are principal protected, so at the very least, you get your principal back. For some funds you could indeed lose your entire investment.

Looks like the funds that are principal protected are the best way to go. What kind of funds are these, and which companies provide them?


You must remember than fund managers are professionals... or at least they pretend to be. The key is in choosing a company or someone you are comfortable with, someone who will not tell you BS just to get your business.
:frank:

Hehehe, I think I've heard enough MLM talk to last me a lifetime. People who never give you a clear picture of the risks involved. At least you and KD were honest enough to tell me the worst scenario. If I heard this from someone else, I might have heard something to the effect of "relax, your money is safe with us. this is a no-lose situation". :ayaw:

I visited Sun Life's website, but their descriptions in the mutual funds page are beyond what my poor brain can comprehend. I guess it doesn't help that I only had 3 units of accounting in college... :(

:cool:

[Hulk]

Originally posted by thehitman


Ack! This is just as risky as stocks and forex!

I've seen some names of companies here and in some related threads, names like Sun Life, ManuLife, Philam, etc. Where would my investment be "safest" (if the term exists in this world of mutual funds), based on the latest performance of the companies in relation to mutual funds?

**off-topic**

Just want to share the sad experience of my friend. He invested $5000 in forex, and his broker was dealing with the Swiss currency. He became very excited because his broker informed him that he had already gained an additional $2500 in two months. Alas, something went wrong, and his entire $7500 is gone now. The only good thing was that the $5000 investment was his excess cash. Who knows what would have happened if that $5000 was his life's savings? I'd rather not think about it.

:cool:

Risky as stocks and forex?
Not really. It may seem so, but if created and managed properly, it's less risky. Why? Diversification. Some funds are diversified that they could withstand certain market movements, unlike stocks or forex which are a one-way thing. Furthermore, since these guys are pros, they could move faster than the average investor to properly adjust during market shifts.

Forex
You could probably read some of my posts on Forex threads. There are several things wrong with these type of investments, they are (no offense to non-bank Forex traders):
1. The objective of your broker is for you to trade. They make their money from trade commissions. Active trading is not really for everybody.

2. In my honest opinion, investments in currency should serve a purpose. I've always held the belief that it is a hedging tool, not a speculative tool. By investing in currencies, you are merely gambling at something you don't know jack about. You're probably better off gambling in a casino.

3. Foreign currencies are complex investments. It's hard enough to predict where the Peso-Dollar exchange rate would go, so just imagine the difficulty in figuring out where the Swiss franc-Dollar exchange would go. Currency movements are caused by an interplay of factors that are economic, political and social in nature. Not even the most seasoned of bank traders could claim that they are adept in third currencies. Forex traders here rely heavily on charts, but without fundamental economic reasoning, its very difficult to merely rely on technicals.


:frank:

[Hulk]

Originally posted by thehitman


Looks like the funds that are principal protected are the best way to go. What kind of funds are these, and which companies provide them?

I visited Sun Life's website, but their descriptions in the mutual funds page are beyond what my poor brain can comprehend. I guess it doesn't help that I only had 3 units of accounting in college... :(

:cool:

Principal-protected funds
Locally, I am not sure which ones offer principal protection. I have however seen proposals from principal-protected funds from foreign houses like SBC Warburg and JP Morgan.

Sunlife
All I can tell you about Sunlife is that they have a very competent team of fund managers. I have made acquaintances with some of them, and in terms of competence and ethical standards that they are required to follow, you probably cannot ask for something better, locally. Of course the marketing officer is a different animal altogether. If I recall may PExer dito who sells Sunlife Fund.


:frank:

[KuyaDanny]

Comparative Performance of Some Philippine Mutual Funds
YTD Yields as of 27 March 2002

Equity
Sun Life Prosperity Phil Equity 15.74%
Philam Strategic Growth 14.72%
Philequity 6.02%
Abacus Growth 3.64%
United 3.26%

Balanced
GSIS Kabuhayan 17.79%
MFCP Kabuhayan 17.62%
Philam Fund 11.74%
Sun Life Prosperity Balanced 10.50%
All Asia Fund 4.54%

Bond
Ayala Life Fixed Income 2.33%
Philam Bond 2.25%
Sun Life Prosperity Bond 2.25%
Philam Dollar Bond 1.82% (US Dollars)
All Asia Fixed Income 1.75%

Benchmarks
Phisix 20.16%
364-day Treasury Bills 1.77%
Fed Funds 0.86%

[nance]

20.16% ang Phisix? That's >2% higher than the best performing mutual fund this year!

KuyaDanny, mag-setup ka naman ng index fund that tracks the Phisix :) Para maka-participate naman kaming small investors sa Philippine stock market na hindi na iniintindi ang abilidad ng fund manager.

Btw, those who want to learn more about mutual funds will do well to read John C. Bogle's books and speeches (http://www.vanguard.com/bogle_site/bogle_home.html). John Bogle set up the first US index fund and is the founder of the Vanguard (http://www.vanguard.com) funds, the 2nd biggest mutual fund company in the US (after Fidelity).

[nance]

Proof that past performance does not guarantee future growth: YTD Yields as of 30 May 2002 (http://www.inq7money.net/mutual/netasset.asp) (ang ayaw ko lang sa page na ito ay walang benchmarks like the Phisix.)

If you're going to invest in a mutual fund, read the prospectus. Carefully. From cover to cover. Including all the fine print.

[Hulk]

Originally posted by nance
Proof that past performance does not guarantee future growth: YTD Yields as of 30 May 2002 (http://www.inq7money.net/mutual/netasset.asp) (ang ayaw ko lang sa page na ito ay walang benchmarks like the Phisix.)



I would just like to discuss something about benchmarks, as benchmarks is a major topic in portfolio management.

For a benchmark to be effective it has to be similar to the one you are comparing it to. Although the Phisix is a widely accepted benchmark, it hardly is a good one.

First of all, it is not a good benchmark for Bond and Balanced funds because of the fixed-income component of these funds. Second, it also not reliable for Equity funds since it does not take into consideration the style that the Fund uses in allocating its investments.

All the Phisix tells you is the performance of thirty stocks. It does not tell you about the performance of second-liners, and especially not those belonging in the small board. Although it is a satisafactory benchmark for value funds, its totally inappropriate for growth funds who invest heavily on small-cap stocks, mainly because of these stocks speculative nature.

In the area of fixed income, it's always sad to see most funds use the 91-day Tbill or the 364-day Tbill as their benchmarks. These benchmarks greatly exaggerate their performances because it is situated in the short-end of the yield curve. The 5-year or the 10-year FXTN is perhaps a more accurate barometer for their funds.

It is unfortunate that we have very few choices in terms of benchmarks while in more advanced markets like in the US, they have several benchmarks that can suitably meet the needs of various investing styles.

Gawa kaya ako ng benchmark... the HULK 100! :lol:


:frank:

[Hulk]

Originally posted by nance
If you're going to invest in a mutual fund, read the prospectus. Carefully. From cover to cover. Including all the fine print.

He! he! he! Tama 'yun! Dapat makulit ka rin! Tanong ka lang ng tanong kahit feeling mo stupid yung tanong mo. Doon mo lang malalaman kung niloloko ka lang ng nagbebenta sa iyo. :lol:


:frank:

[StoneFree]

How is the mutual funds market in the Philippines doing?

[Spyfrat]

http://www.inq7money.net/mutual/netasset.asp

[thehitman]

*untog*

Would Mutual Funds (right now) provide better returns than a time deposit account that gives me 7% per annum (net)?

:cool:

[KuyaDanny]

Comparative Performance of Some Philippine Mutual Funds
YTD Yields as of 30 September 2002

Equity
United 4.59%
Philam Strategic Growth 1.10%
Sun Life Prosperity Phil Equity -5.01%
Philequity -5.29%
Filipino Fund -14.70%

Balanced
Philam Fund 8.48%
First Galleon Family Fund 1.23%
Emergent Fund 1.19%
Sun Life Prosperity Dollar Advantage 0.96% (US Dollars)
MFCP Kabuhayan -0.40%
Citisec Growth & Income -1.83%
Sun Life Prosperity Balanced -3.34%
GSIS Kinabukasan -3.92%%
ECC Growth & Income -5.63%
All Asia Fund -13.27%

Bond
Philam Bond 6.64%
Sun Life Prosperity Bond 6.48%
Ayala Life Fixed Income 5.59%
Philam Dollar Bond 5.37% (US Dollars)
All Asia Fixed Income -12.52%

Benchmarks
Phisix -3.32%
364-day Treasury Bills 4.15%
Fed Funds 0.64%

[NoisyCricket]

For those who would like to know more about the Sun Life Prosperity Funds (Bond Fund, Balanced Fund, Phil. Equity Fund, and Dollar Advantage Fund)

*or* the

Ayala Life Fixed Income Fund, email NoisyCricket! (vmanlapaz@one.com.ph)

[thehitman]

BUMP!

Any no-load funds here in Pinas?

:cool:

[thehitman]

BUMP ulit!

Bea: How much is the annual management fee for your funds?

:cool:

[annoying_bread]

What's a bond fund? How can I avail this kind of investment? How much amount does it require?thanks.:*) :flower:

[Bea19]

Hi! to all those interested in mutual funds, I'm with the mutual funds division of Philam.

You might want to check out the thread of " where can I invest my P30K " we have already started a short discussion of bond funds. ;)

[Bea19]

Sunlife po ang 7 years.I'm with Philam Asset the mutual fund division of Philamlife.Kung conservative investor kayo I suggest the Philam Bond FUnd kse fixed-income instruments ang pinaglalagyan kaya safe.Pls PM me na lang po your emails if you have queries....thanks

[mac_bolan00]

^^

sayang, i decided against long-term instruments. philam also sizes its bonds at 10k, right? my longest-tenor instruments right now are retail t-bills (8% net for 3 years).

[Bea19]

pero you know what sa Philam Funds namin we are not worried about the fiscal crisis...kse since actively managed ang funds namin plus we are under AIG Risk Management, since last year pa we have been doing something regarding the crisis like we have no tenors above 7 years..so yun ang maganda pag sa mutual fund din actively managed yung fund kaya even before a crisis occurs nakapag act na yung fund managers to protect the investors.

[Bea19]

elo...sa mga nag Pm po sa akin about info regarding mutual funds na email ko na po...thanks

[travy]

do u know where to get prospectus of all mutual funds in the philippines? tnx

[KuyaDanny]

Each fund should have a prospectus which is provided by the person/institution authorized to sell it to the public.

[travy]

but do u know where to get

1. list of all mutual funds in the Phil.
2. infos (prospectus) about each fund so u can compare its performance?

[charmedPrue]

bea: ako rin po. :) musicalette@yahoo.com . tnx!!

[KuyaDanny]

There's a mutual funds report which periodically appears on http://money.inq7.net

Click here to download a PDF version of the report as of 31 August 2004 (http://money.inq7.net/mutualfunds/mutualfund01092004.pdf).

This is not a list of all the mutual funds in the Philippines, only the largest ones. I haven't found the kind of list you are looking for. There is a trade association for mutual fund managers, the Investment Company Association of the Philippines. I don't know how to reach them, though.

[Hulk]

Originally posted by Bea19
Hi! to all those interested in mutual funds, I'm with the mutual funds division of Philam.

You might want to check out the thread of " where can I invest my P30K " we have already started a short discussion of bond funds. ;)

Hey! I might be interested pero I just have two questions:
1. What is the average duration of the securities in Philam's portfolio?
2. Is Philam marking-to-market its securities?


:frank:

[KuyaDanny]

Philam is NOT marking-to-market its securities - at least not the bond holdings (e g, ROP, etc). I checked and checked again.

[travy]

which is better...investing in stocks or bonds or mutual funds or real estate or business?

[KuyaDanny]

What does "better" mean to you?

[Bea19]

Hi Hulk! Thanks Kuya Danny for answering...

regarding Hulk's 1st question even before GMA'a announcement regading the fiscal crisis we at Philam have already been preparing for that because we have the AIG Risk Management who does that job for as full time...so since last year sa portfolio namin when it comes to securities we have a mandate na di kame pwd magkaroon ng securities with a tenor of more than 7 years. ;)

for your 2nd question...accrual method pa din ang gnagamit namin when it comes to our funds kaya are clients can enjoy better rates...we are preparing for the market to market scenario that will probably be applicable in the next year or so...

so yun ang maganda talaga sa mutual funds, since actively managed sya assured ka na we as fund managers can adapt to any financial crisis ;)
Please Pm me na lang for additional queries baka kse hindi ko ma browse itong forum ulet...thanks

[Bea19]

Btw, please check our website www.philamfunds.com and www.gsismutualfunds.com

thanks...

[travy]

Originally posted by KuyaDanny
What does "better" mean to you?

better in terms of roi, profitability, tax shelter

[Hulk]

I brought about an important topic that every potential investor should understand... marking-to-market!

What is mark-to-market (MTM)? MTM is recognizing the market value of the securities in the fund at current market prices. Like stocks, bond prices also move. It's not "fixed" as the name fixed-income implies. The prices of bonds move inversely to movements in interest rates. The best practice for any fund is to MTM their securities unless their intention is to hold it until maturity.

Why is it important? In case everybody in the fund pulls out their money, the fund will be forced to sell its security holdings at market prices. If interest rates rose prior to the sale, then the total value of the fund should drop considerably, meaning you might get an amount less than your original investment.

Asking your mutual fund seller, if they mark-to-market is therefore a must in understanding the safety of your investment.

Another important question to ask is the duration of their portfolios. Most mutual funds have long portfolio durations. 5 to 7 years for peso funds and most dollar funds have average portfolio durations of 13 years!

What is the significance of a long portfolio duration? Well the longer the portfolio duration, the bigger the drop in bond price when interest rates increase! A 1 percent change in interest rates could cause a a portfolio with a 13 year duration to have capital losses by more than 10%.

Why is this all important? Well since we are in a fiscal crisis... everybody should realize that interest rates are rising!!!


:frank:

[summit012]

what is ur recommendation on these books/authors

1. trade ur way to financial freedom by van tharp
2. one up on wall street by lynch
3. beating the street by lynch
4. how to make money in stocks by o'neal

[woofers]

bump

[woofers]

Philam Asset Management's Mutual Funds: http://www.philamfunds.com/
GSIS Kinabuhayan (Managed by Philam): http://www.gsismutualfunds.com/Features.htm
Sun Life Mutual Funds: http://www.sunlife.com.ph/mutualfunds/
Kabuhayan Fund (Mutual Fund Company of the Philippines): http://www.mutualfund.com.ph/

To find out how the various funds are performing, visit http://money.inq7.net and click on the Mutual Fund Report button near the bottom of the page. It opens up a popup with a link to a PDF file.

[Bea19]

please visit our website ....philamfunds.com ;)

[Chase_Meridian]

Hi. What do Equity, Balanced, Bond, and Benchmarks mean?

[camerlengo]

why dont you try the ayala fixed income fund by bpi
its a 21 Billion fund and still growing

ang taas ng yield ng philam dollar bond fund
naka accrual kasi
pero kung mark-to-market
baka lubog sa losses

[camerlengo]

bea19
boss mo ba si joey?

[Bea19]

Yup yup!Alberto V. Ramos our new Pres and COO.nag start sya nung around Feb lang.Honestly camerlengo I don't think pag nag mark to market malulubog sa losses kaya nga actively manage eh, you can act depending on the situation and I don't think Philam will let that happen. I guess your from BPI right?

[aKoiTo]

can I ask the experts.......

considering that you are in the shoes of an investor now with a 100K or say 200K on hand, where/what company and what type of fund will you be investing it?

just wanted to know options, thanks.

[Bea19]

It depends din kse kung anong objective mo sa money mo e...tska anong time horizon mo....like disposable income mo ba yan or gsto mo lang pakitain para next year may paggagamitan ka....

[aKoiTo]

thanks bea, this money can be considered disposable one so I guess a two or three years can be the target.

Do you have any advice on what is possible on your mutual funds?

thanks

[Bea19]

I suggest kung disposable income naman sya tapos medyo long term ang horizon mo invest ka sa may stocks na mutual fund. Mas aggressive sya although may risks pero since long term naman ma miminimize ang risk.I emailed you already.

[aKoiTo]

hi Bea thanks, I'll check your email

[dreyes]

i'm new to investing and interested in mutual fund. how do you compute for gain or losses in the fund say in 1 or 2 years?

[Bea19]

dreyes, maybe you can PM me your email add so I can send you some materials regarding mutual funds plus ma explain ko pa sa yo ng mabuti...thanks

[dreyes]

bea you have pm

[Bea19]

ei dreyes, sent you an email alrdy tnx :)

[MySecretSelf]

pasend din po ng detail @ onion_leeks@yahoo.com. thanks!

[Bea19]

i alrdy emailed the files na po.hope you were able to open them.thanks

[ijpsantos]

can u give me some insights regarding investing my money in T bills. i rili don't know how it works (tbills nd mutual funds)

[Hulk]

Originally posted by Bea19
pero you know what sa Philam Funds namin we are not worried about the fiscal crisis...kse since actively managed ang funds namin plus we are under AIG Risk Management, since last year pa we have been doing something regarding the crisis like we have no tenors above 7 years..so yun ang maganda pag sa mutual fund din actively managed yung fund kaya even before a crisis occurs nakapag act na yung fund managers to protect the investors.

Actually "actively management" doesn't really insulate you from a lot of risk. To avoid marked-to-market losses in a upward shifting yield curve, a fund manager has to literally liquefy his portfolio holdings. Now if you liquefy it, you will enjoy the low end of the curve which is about 6.75%, the BSP ovenight rate, gross or net depending on your tax position. Now if you guys ever do this, people will see a rapid deterioration in yields which for marketing purposes, you don't want to happen.

Another issue about liquefication is the ability of the market to absorb large positions. Unfortunately given the asset sizes of any of the mutual funds, the market would be hard-pressed to absorb such volumes.

Right now, mutual funds are safe because the accrual method is permitted, but you guys will have the same reaction of panic when the MTM method was applied to GSEDs (active primary and secondary dealers of GS) 6 years ago and to common trust funds (another active dealer) this coming January.


:frank:

[KuyaDanny]

Unfortunately given the asset sizes of any of the mutual funds, the market would be hard-pressed to absorb such volumes.

...unless a very large local AIG insurance affiliate stands ready to make a market in any security held by a Philam mutual fund?

[Bea19]

ijpsantos, just PM me your email address or your contact info so I can get in touch with you para mas madali ma explain ang TBILLS and Mutual Funds. Thanks

[Hulk]

Originally posted by KuyaDanny
...unless a very large local AIG insurance affiliate stands ready to make a market in any security held by a Philam mutual fund?

Yeah, if the top management of the conglomerate decides to do so. But if I were heading the insurance affiliate, I wouldn't agree to such an arrangement, because I would be in a severe marketing disadvantage especially with regards to variable plans.


:frank:

[KuyaDanny]

If the insurance company sells variable plans. I don't think they do yet. In the meantime, Philamlife remains a large investor in fixed income securities which it needs for insurance operations. I'm not sure if the insurance commissioner now requires marking to market, but it didn't when I was still working there.

[Hulk]

The IC doesn't require insurance companies to do m-t-m because of the long-term nature of its liabilities. Most insurance companies simply match the duration of assets and liabilities.

However I still think it would be bad practice to dump securities from one affiliate to another, just like I abhor treasury groups that dump their unwanted securities to trust departments. At the end of the day, the receiving fund manager should be held under the prudent investor rule.

Of course the transfer could be done based on market prices, but that would definitely mean huge haircuts for anyone liquidating their long-term holdings at this point although it is the most prudent thing to do given the continued expectations of rising interest rates. The BTR just announced increase in auction sizes for FXTNs last week.


:frank:

[Hulk]

Medyo matagal pa pala yung mandatory requirement for M2M (mark-to-market at hindi yung singing duo). *okay*

Excerpts from the Phil. Star:

SEC DEFERS IMPLEMENTATION OF INTERNATIONAL ACCOUNTING STANDARD

The SEC has given the local mutual fund industry some leeway on the adoption of the International Accounting Standards (IAS) set to be implemented starting January next year.

In a letter to the Investment Company Association of the Philippines (ICAP), SEC General Accountant Roberto G. Manabat said the SEC will allow local mutual funds using accrual valuation to run off for the same period allowed for Common Trust Funds (CTFs) or up to September 2006 on the condition that they submit a plan of action as to their conversion.

The move was in response to ICAP's request for deferment of the effectivity of IAS 39. IAS 39 prescribed the mark to market (M2M) valuation for financial instruments such as those in mutual funds.

In view of this, Manabat said local mutual funds would be required to make a parallel reporting on a monthly basis to SEC of both the accrual to M2M valuation, beginning July 2005. Each fund, he said, should be given the option to shift from accrual to M2M at anytime in 2005 as each fund may have different investment mixes and therefore may at anytime in 2005 narrow the gap between accrual and M2M basis.

The ICAP had requested for the deferment of IAS 39 until January 2007 to give it more time to address critical issues such as the establishment of the Fixed Income Exchange and the uniform financial accounting and reporting standards.


:frank:

[NoisyCricket]

Since we're talking about investments, for people who are interested, I can recommend a friend of mine who is an MDRT with Philam. I hear their Dollar-Bond Fund did pretty well last year. Here are some figures.

Summary by Instrument Type----------Placements----------% to Total----------WAIR
Cash in Bank----------1,385,153.08----------0.63%----------0.000%
ROP - Long Term----------122,939,738.61----------55.57%----------7.585%
Deposit Agreement----------22,110,483.99----------9.99%----------1.408%
US Treasury-Long Term----------37,490,671.72----------16.95%----------3.391%
Corporate Bond-Long Term----------31,870,627.01----------14.41%----------7.810%
Treasury Bills----------1,911,064.60----------0.86%----------3.012%
Total Fixed Income Investments----------217,707,739.01----------98.41%----------6.236%
Accrued Interest Receivable----------3,519,803.94----------1.59%

Total Fixed Income Portfolio----------221,227,542.95----------100.00%

Performance
Yield (Year-to-Date) 4.12%
Yield since Launch 19.59%
Average Annual Rate 6.09%

[KuyaDanny]

An important disclaimer, which unfortunately many people often forget when talking about returns on mutual funds:

Past performance is not indicative of future results.

[Chase_Meridian]

Even not-so-distant past performance (say 3 years)?

[Bea19]

Ei NoisyCricket, thanks for promoting our funds. For those who need any more materials regarding mutual funds just Pm me your email addresses and I'll send you some updates regarding our funds.Thanks

[camerlengo]

bea19

why is your fund stuck at 7B even though yield is 8+%

the ayala fixed income fund is now 28B from just 22B at yearend 2004
even if its yield is just 7.6%

[Carlitos]

Question : What is the difference between accrual method and mark-to-market method? How does it affect fixed income Mutual Fund investments ?

This is one of the concern of the fund managers right now. I don't have any idea regarding these terms.

I'm planning to put some money into it but I wanted to make sure that I'm not gonna lose a lot of it. Can anyone explain it in it's simplest way ?

Pasensiya na po newbie lang ako sa mga ganitong discussions ...

[lupuS]

Accrual: Assets valued at purchase price + interest received but not reinvested + accrued interest income +/- amortized discount or premium

Mark-to-market: Assets valued at current market price + interest received but not reinvested

[FutureGizmo]

Even not-so-distant past performance (say 3 years)?

Of course, it pays to invest in mutual funds with a solid and consistent history of earnings but this should not be taken as an accurate predictor of future income. One single mistake in the investment of the fund could wipe out most, if not all, of the funds. Similarly, a mutual fund that fares poorly year by year can hit the jackpot and earn a lot from only a single investment. Still, it is better to opt for stable and well-known mutual funds.

[Bea19]

camerlengo, there is a lot that goes on when mutual fund companies post their AUM like AYALA for instance. AT the end of the year they can just transfer some funds from the bank to their mutual fund to post a higher AUM. The actual AUM of the fund does not dictate the year's earnings. What matters most is the portfolio of the fund. For fixed-income fund you can more on less depend on the projection that the fund manager gives at the start of the year. But for equity-laced funds medyo dictated kse sa economy natin kaya hindi mo talaga maasahan ang historical performance nya.

[simoen]

hi bea, KD, hulk, etc! i have a question regarding mutual funds. i read the entire thread and i got the gist of it but i just wanna clarify a few things. pasensya na in advance, programmer lang ko and financial terms are beyond me. based from KD's explanation, mutual funds are like time deposits but riskier because :
(a) it's being managed by a fund manager and therefore you aren't sure if niloloko ka ba
(b) the fund manager pools all money invests it in stocks (stocks lang ba? if not, saan?)
(c) is the fund manager required to inform his clients the investments he made?
(c) are sunlife and philamlife examples of MF companies?
tama ba, so far? thank you so much for your patience.

[crepesuzette]

hello bea, kd, hulk, camerlengo etc.. i wanna invest sa mutual funds pero di alam kung saan pupunta at kanino ipagkakatiwala ang pera ko. any suggestion?

[camerlengo]

if you look at yield, maybe philam
if you look at size of the fund, maybe bpi's ayala fund

if you want stability, pick between bpi and philam

[woofers]

One single mistake in the investment of the fund could wipe out most, if not all, of the funds.

Actually, the opposite is true. Because the funds are diversified and the funds' prospectus limits its participation in any one investment to a relatively small percentage of the funds' total value, there is no way that a single bad investment could wipe out the fund.

[KuyaDanny]

(c) are sunlife and philamlife examples of MF companies?


Sunlife and Philamlife are insurance companies. However, all insurance companies have money which they need to invest. Over the years they develop good investing skills (we hope) which can be used for other important purposes, such as making other people's money grow. Managing mutual funds is one way to use those skills for the purpose.

Technically, Philamlife does not manage mutual funds. An affiliate, Philam Asset Management, Inc, does. I am not sure how Sunlife does it.

[KuyaDanny]

(a) it's being managed by a fund manager and therefore you aren't sure if niloloko ka ba


You can never be sure "if niloloko ka ba." If you invest your money in a company run by a friend or a professional manager, you would not possibly know the whole truth about the company affairs, even if you were working there yourself.

If you put your money in a bank, you would not always know if the bank were becoming bankrupt :lol: until it's too late.

That's why mutual funds set up control mechanisms such as boards of directors, investment committees, auditors, and other means of governance so that there is some comfortable level of protection for investors.

It is not a 100% guarantee of safety, but then nothing in this world ever is.

[KuyaDanny]

(c) is the fund manager required to inform his clients the investments he made?


The fund should regularly publish a report and make it available to investors at a reasonable time after publication. Very few fund managers are required to report every transaction made as soon as it is made. That would be very inefficient and would only increase the management fee. But a fund does have books and accounting records and I would presume any reasonable fund manager should be willing and able to answer questions posed by the investors.

[KuyaDanny]

(b) the fund manager pools all money invests it in stocks (stocks lang ba? if not, saan?)


Depends on the fund guidelines and strategy. Some are all-stock, some all-bonds, many are some combinations of the two, and yet others include more sophisticated financial instruments such as options, etc.

[Bea19]

Hi everyone! Ngayon lang ako nagka time mag visit sa PEX. A mutual fund is defined by its investment objective. from there dun ibabase kung san mag iinvest ang fund manager. A mutual fund has to be diversified at all times and they have to follow certain guidelines. The fund's performance actually has a lot to do with the skills and experience of the fund manager. There are reports that are made in a year to the shareholders of the fund to update them regarding the portfolio of the fund. Philamlife is the mother company in the Phil of Philam Asset Management, Inc. Philam Asset Management, INC or PAMI is the fund manager of the mutual funds. Please visit our website at www.philamfunds.com may certain site dun for FAQ's. Also you may Pm me your email or contact # so I can answer your questions kung ano ba talaga ang mutual funds. Thanks :)

[bloodasp]

i hear that Peso bond funds will be valuated mark-to-market instead of the usual accrual method. i'm not sure if the change will affect current peso bond funds or will affect only newly created peso bond funds.

[easy_going]

Are there any Philequity Fund investors out here?

Can you tell me you overall experience with this fund?

Im thinking of investing....

[bi0hazard]

i hear that Peso bond funds will be valuated mark-to-market instead of the usual accrual method. i'm not sure if the change will affect current peso bond funds or will affect only newly created peso bond funds.

to take effect on sept 2006... i believe that the existing pesos and dollar bond funds will cease by that time and new ones will be created. let's hear from bea for the official word...

what about UITF's? im looking at the new offerings from different banks and it appears they will become direct competitors of mutual funds. of course there are differences like they're charging annual trust fees while mutual fund companies charge entry/exit fees, et al...

for seasoned vets, what are you more keen to invest on, these UITF's or the new mutual funds come sept 2006?

[camerlengo]

CTFs (in accrual valuation) will cease to exist in Sep 06
they will be replaced by UITFs (in mark to market valuation)
but even now some trust companies have started to offer UITFs

Mutual Funds follow the IAS 39 regulation
where you classify the investments as to held for trading, held to maturity
those held for trading should be marked to market

[tolstoy]

can you enlighten me????

there are variable life or unit linked life insurance policies that works like mutual funds where your money is invested only with government securitites, blue chips stocks, etc... You can also "add-on" and "withdraw in whole or in part", to/from your investment, AND provides insurance coverage to more or less equivalent to your investment.

ergo, if the investor dies while the policy is in force, the insurance company pays his beneficiaries the value of the policy AND the investment is then passed on to his beneficiaries as well.

is this the same with mutual funds?

[o8si5]

Just an update on the performance of all mutual funds in the phil.-


http://www.bworld.com.ph/BW070205/tablesgraphs10.php

[o8si5]

can you enlighten me????

there are variable life or unit linked life insurance policies that works like mutual funds where your money is invested only with government securitites, blue chips stocks, etc... You can also "add-on" and "withdraw in whole or in part", to/from your investment, AND provides insurance coverage to more or less equivalent to your investment.

ergo, if the investor dies while the policy is in force, the insurance company pays his beneficiaries the value of the policy AND the investment is then passed on to his beneficiaries as well.

is this the same with mutual funds?


no, mutual funds are pure investment vehicles.

[tidus1203]

Are mutual funds then parang UITF nang mga bangko??

[o8si5]

FOR NAVPS UPDATE-

http://www.icap.com.ph/factsfignavps.asp





History of the Investment Company Association of the Philippines (ICAP)

In 1995, the ADB, with the support of the AIM, held a regional seminar to further develop the awareness on mutual funds in the Philippines . In the same year, the Investment Company Association of the Philippines (ICAP) was organized by five member funds. ICAP's conceptualization had very noble intentions. The association has positioned itself in the mainstream of the Philippine mutual fund industry with the prime objective of ensuring its success. Behind it were experienced, well known personalities: Mr. Arthur B. Sokolow, identified as the perennial mutual fund player, and Mr. Roberto Lorayes, previous Chairman of the Philippine Stock Exchange. It did not take long for government regulators and the private sector to recognize the ICAP as the association of Philippine investment companies.

In 1998, the ICAP successfully lobbied to eliminate double taxation making it more profitable for mutual fund shareholders. This also gave the mutual funds an edge over the banks' common trust funds, thus paving the way for stronger market acceptance.

In the new millennium, mutual funds have grown at a pace which will make the industry a formidable one to deal with in the near future. The industry has helped in maintaining investor confidence despite the prolonged Asian crisis. It has minimized capital flight and has brought new perspectives in terms of the investment and savings maturity in the country. Given the need for the country to compete in the global markets, mutual funds will certainly serve as a vital ingredient for current and future national development

[o8si5]

Are mutual funds then parang UITF nang mga bangko??

UITF Vis a Vis MUTUAL FUNDS
The Philippine’s full adoption of the IAS 39 or mark-to-market sometime on September 2006 shows the country’s commitment in aligning the operation of pooled funds with international best practices and standards. In line with this, the Bangko Sentral ng Pilipinas through the BSP Circular 447 dated September 3, 2004 created the Unit Investment Trust Fund (UITF) which is now being distributed by banks. The UITF is an open-ended fund that pools the investments of investors into a larger fund under professional management. The investors share in the gains or losses of the fund, proportionate to their respective participation in the pool. Likewise, the fund’s assets are strictly market-determined based on the daily mark-to-market valuation. Unlike other bank products, however, UITF is not covered with PDIC insurance since it is not a deposit product.

Indeed, this reform in the trust industry poses a challenge to the mutual fund industry as the UITF becomes a direct competitor of mutual funds, more so when mark-to-market gets fully implemented on the latter in September 2006. Although yields seem to be the be all and end all of investing, it is necessary also to learn the fundamental characteristics of the investment vehicles as they may also play an integral part in determining the profitability or staleness of the funds.

To start with, both UITF and mutual funds are investment vehicles in which various participants or investors invest their money in a pool of assets for the purpose of profitable returns. They share common benefits as follows:

1. Investors gain low cost access to the expertise of top fund managers. Normally, without these pooled funds, only high networth individuals or institutional investors can avail of such services.

2. Investors get to own a wide cross section of investment outlets for a minimal investment amount. These funds effectively diversify portfolio allowing investors to maximize their earning potential.

3. Investors get a wholesale pricing for a retail investment. Through the pooled funds, they may enjoy a higher investment return as against an individual investor since the pooled investible funds are higher in monetary value.

While they share common benefits, the two funds differ in the legal /regulatory context.

1. The UITF is created by virtue of a Declaration of Trust executed by a bank with a trust license. Its fund management and operations are supervised by the Bangko Sentral ng Pilipinas (BSP). The UITF clients get participating units of investment for their placements. On the other hand, a mutual fund has a corporate existence. It is a legal entity that makes investments on behalf of their shareholders and is regulated by the Securities and Exchange Commission. Clients of a mutual fund effectively invest in shares of stocks of the fund.

2. A mutual fund charges entry and exit fees should the client redeem his shares from the fund within the prescribed holding period whereas UITF charges a fixed trust fee per annum to its investors and an early withdrawal fee.

MUTUAL FUNDS ADVANTAGE OVER UITF

While UITFs may have some distinct features, the following are advantages of mutual funds over UITFs that make them still the best options for both the retail and institutional investors.

1. Diversification – While both structures are highly diversified, the banks will probably sell the products to their existing depositors. In this regard, the depositors will be better off diversifying their exposures to the mutual funds that are not products of their own banks. In this way, their short term money remains with their bankers while their long term savings are not exposed to the same entity. Remember that UITFs are merely bank products and therefore, investing in the UITF offered by the same bank holding their deposits will be like putting their eggs in one basket so to speak.

2. Track record – UITFs are new vehicles and do not have a track record or performance to speak off. Banks will probably refer to their old CTFs’ performance but these are highly unregulated products that offer direct loans and therefore are not comparable to UITFs that cannot do direct lending. Furthermore, the UITFs are valued MTM while the CTFs were mostly valued on accrual basis.

3. Transparency – Mutual funds, being corporate structures are very transparent in terms of their investment portfolio. UITFs, being bank products do not need to be as transparent. In fact, there have been many incidents in the past where bank clients complain because the CTFs were given bonds that defaulted. These were bonds that were suspected to be originally in the books of the banks.

4. Voting rights – Mutual fund shareholders have the right to replace their fund managers if the latter performed poorly for the shareholders. UITF unit holders, on the other hand cannot replace the bank that owns the product in the first place.

5. Independent Directors – Mutual funds have their own set of board of directors whose concerns are mainly that of the fund and not the fund manager. The banks’ directors, on the other hand, will always prioritize the bank. UITF do not have a board of directors to safeguard the unit holders’ interest.

6. Valuation – For now our biggest advantage is the fact that we are still on accrual basis (the bond funds) while all UITFs are valued marked-to-market already. This may offer the investors enough breathing ground especially to bond fund investors who have adverse outlook on mark-to-market.

[o8si5]

[QUOTE=tolstoy]can you enlighten me????

there are variable life or unit linked life insurance policies that works like mutual funds where your money is invested only with government securitites, blue chips stocks, etc... You can also "add-on" and "withdraw in whole or in part", to/from your investment, AND provides insurance coverage to more or less equivalent to your investment.

ergo, if the investor dies while the policy is in force, the insurance company pays his beneficiaries the value of the policy AND the investment is then passed on to his beneficiaries as well.

QUOTE]

YES,your beneficiaries will receive benefits from both the life insurance component and the investment component. Your life insurance component will pay benefits equal to the face amount of the basic term insurance coverage plus any riders attached to the policy. The investment portion gives the full value of your account, or the minimum death benefit, whichever is higher

[o8si5]

but do u know where to get

1. list of all mutual funds in the Phil.
2. infos (prospectus) about each fund so u can compare its performance?


1. Most updated NAVPS list-www.icap.com.ph, go to "facts and figures" Also, www.bworld.com.ph, go to phisix(middle part of the page), click on it, then on the right side is mutual funds. These lists also shows the fund's performance.
2. You can go to the mutual fund companies website, call their office numbers and request for a prospectus(some can mail it to you), you can request for an email, or go to their office persoanlly to get a copy.
:)

[o8si5]

BUMP!

Any no-load funds here in Pinas?

:cool:


i think there is. im not sure. anyone knows about the BPI Index Fund? Is it no load? :)

[o8si5]

Vanguard S&P 500 Index fund is a good mutual fund. http://www.vanguard.com

It invests in the 500 stocks that make up the Standard and Poor's 500 Index Fund. the blue chip stocks.

The expense fees are really low too compared to other mutual funds that charge a load fee of 3% a year.

The return is around 24.9% a year. That's off the top of my head, but goto the site and you'll see the numbers.

If you don't have access to the mutual funds that there are SPDRs (Spiders). They are the same thing as the S&P 500 index but they sell as individual stocks.



Yes, I agree that Vanguard is one of the best, if not the best, index funds around in the US. And I also agree that Vanguard is a VERY GOOD mutual fund company. In the Phil., we dont have ETFs yet like DIA or SPIDERS or QUBES that trade like stock. But we do have one index fund, managed by BPI. :)

[Brix99]

Bea19 could you also e-mail me about the Philam Bond Funds. Thanks.

[Brix99]

Bea19 could you also e-mail me about the Philam Bond Funds. Thanks.

[Brix99]

Many mutual funds look good on paper, but charge excessive fees. how much does philam charge when investing in mutual funds?

[Bea19]

For the Peso Bond Fund it starts at 2% for P5K-P99,999. For the Dollar Bond Fund it starts at 2% for the minimum of $2K. Pls pm me your email ad.

[Fortune]

think bpi charges 1% only
taga pala philam

[topnotch97]

does anyone here invest in mutual funds here in the states? i'm deciding whether to invest let's say in Wells Fargo (since it's my current bank) or try to open with eTrade or which ever.

Anyone who have tried this, especially if you're in the states, kindly share some insights. thank you.

[topnotch97]

oh and btw, even mutual fund advisors here in the Philippines. please don't hesitate to send info to me. I would also appreciate it also. i would also welcome anyone's insights.

since i'm a beginner in this area, i'm just the type of person who would actually learn as i go along. i don't have any solid objective right now, but opening a mutual fund would let me learn the investing trade. right now, my supposedly purpose to invest is to have funds later on to start a business, give or take like 10 years from now.

[o8si5]

does anyone here invest in mutual funds here in the states? i'm deciding whether to invest let's say in Wells Fargo (since it's my current bank) or try to open with eTrade or which ever.

Anyone who have tried this, especially if you're in the states, kindly share some insights. thank you.


hi!im in manila but i worked with AEFA(American Express Financial Advisors) for 1.5 years, mutual funds trading..I have not opened an account yet(in the US) but what I can say is that the trading of mutual fund in the states is very advanced and easily executed unlike here in manila. ..Btw, E*Trade has good trading system and its very fast..

[malfoy2k]

hi!im in manila but i worked with AEFA(American Express Financial Advisors) for 1.5 years, mutual funds trading..I have not opened an account yet(in the US) but what I can say is that the trading of mutual fund in the states is very advanced and easily executed unlike here in manila. ..Btw, E*Trade has good trading system and its very fast..



oo nga,medyo naghilo ako sa process dito sa manila. kasi sa US, internet lang katapat nito......

sana maapprove *** PERA bill sa Phils. ito *** equivalent ng tax deferred accounts/401k dito sa US. dito mag aapply yung Pay urself First, kasi makukuha mo *** pera n wala pang bawas ng tax..after mong mahulog *** money sa account,saka palang papasok *** tax deductions..

[Bea19]

Hindi taga ang philam. Ang minimum investment amount sa BPI ay P50K up. Atsaka madaming fees na binabayaran ang funds for the transaction. Parang pag nag invest ka sa stock market madami ka ding fees to invest,

[Brix99]

pwede malaman kung san mga branches niyo in makati where i can make a transaction?

[o8si5]

http://www.bworld.com.ph/BW080105/tablesgraphs10.php

[Bea19]

Our main office is in 5th Floor Philamlife Gammon Bldg L.P leviste St., Salcedo Village Mkti. Just infront of the Makati Sports Club.

[Fortune]

maybe philams advantage is you can start at 5k while bpi is at 50k
but am sure eventually an investor will invest at least 50k

so again why would you go philam and pay 2% fees
when you can go bpi and pay just 1% fees

and how can you explain that bpi's fund managed for mutual fund peso is now 40 billion and philam is stuck with 8 billion

alin kaya ang mas stable?

[easy_going]

Actually the 2% your referring it its their sales load, asdie from that, philam charge at least 1% for annual management fees....while BPI has no sales load and also a 1% management fee. Sa Philam, meron pa exit fee if withdrawn less than 2 years.

I have investments in both products, and hand-down, banks UIT are much better than mutual funds; at least those invested in fixed income! *okay*

[codylee23]

which bpi investment funds has 50k min investment? i was only able to find the 100k min only on their website.

[o8si5]

http://www.bworld.com.ph/BW080605/tablesgraphs10.php

[Brix99]

wow.. dami pala charges ng philam. may natitira pa kaya sa interest?

[PinoyOCW]

Hello fellow Pexers!

This is a very interesting thread.

I am based in the middle-east and have started investing here in mutual funds late 2003. I just want to give you guys an idea how my local equity fund investment is faring. My fund investment in 2004 had a return of 105%. The same fund has already appreciated by 95% year to date. Very attractive returns indeed.

There is also a Country specific (Asia) fund which I invested 2 1/2 months ago. The fund has already appreciated by 12%.

Investing in mutual funds suits me because it does away with the hassle of managing my investment. I am also assured that my investment is managed by a team of professionals who follow certain investment methods, strategies and model portfolios. Of course not all mutual funds investments give a positive return. There are also a number of rotten apples in the bunch. Before investing, I suggest that you research and try to find out about a fund's investment objective and policy. Research, research, research before you commit into an investment.

[o8si5]

hi pinoyocw!welcome to the mf thread. may i ask what is ur mutual fund company?tnx!

guys, here is the navps update AS OF AUG 8,2005

http://www.icap.com.ph/factsfignavps.asp

[camerlengo]

^does this file show fund size?

[o8si5]

^does this file show fund size?

no, this link only shows the NET ASSET VALUE PER SHARE(NAVPS) or NAV for short of all active mutual fund companies in the Phil., updated on a daily basis by ICAP.

As of AUG 9, 2005...

http://www.icap.com.ph/factsfignavps.asp

[Fortune]

fund size is important to show which funds are biggest
therefore more investors/investments
most trusted

[Spyfrat]

im semi retired investing in our local stk market and a full time seaweeds supplier/trader. i have a litol understanding about forex trading, as well as the local & US market stk investing. may papatol kaya kung mag apply akong private "fund manager" nyo? :bashful:

[morrissey_05]

spyfrat,

teach us what you know na lang for a fee. yun baka papatol ako hehehe

[Spyfrat]

u trade forex? i can teach u my system, pls visit www.geocities.com/spyfrat/forexanalysis.html for sample charts.
im a hardcore techie, vovo ako sa fundy. the lesser i knw abt the company the better. no hesitation, no emotion.
sa local stks, rcbc@15 is a trading buy (galing sya sa 18), fer (1.36-1.44)maganda rin ang formation sa chart, possible 2.30/share as target.
sharing opinion is free d ba? kapag may time ako i'll post sa forum.
yung aaply ako as private fund manager pala, nd ko kukunin pera nyo, u do the buy/sell sa kung saan broker nyo gusto. i have 3 managed accounts na nag tetext/call lang ako what to buy/sell sa mga brokers nila (under sa name nila ang account). full disclosure each time my na done na transaction. ang pinasasalamat ko lang wala pa namang may nagmura sa akin sa 3 na yan. :rotflmao:

[dalee]

hi... newbie here! ;)
this thread is so informative!
i really wanna learn how mutual funds work...pls keep on sharing :)

just wanna ask about BPI thing.. 50k for initial investment? where and what type? I'm browsing their website, 100k is the min. :)

[o8si5]

just wana share some thoughts on DOLLAR COST AVERAGING or simply "cost averaging"...-method of accumulating assets by investing a FIXED AMOUNT of dollars or pesos in securities at SET INTERVALS(monthly,quarterly,semi-annual,annual). The investor buys more shares when the price is low and fewer shares when the price is high;the overall cost therefore is lower than it would be if constant number of shares were bought at sest intervals(compare it to buying stocks using min lot size).


it is widely used already in the US unlike here in the Phil, where Filipinos lack financial knowledge and options on where to invest their money. When they think of saving, sa banko kagad ang iniisip nila. Also, in general, it is diffucult and it takes discipline to save REGULARLY.

any thoughts or any ppl out there who has mf accounts that do DCA? :)

[snop]

just wana share some thoughts on DOLLAR COST AVERAGING or simply "cost averaging"...-method of accumulating assets by investing a FIXED AMOUNT of dollars or pesos in securities at SET INTERVALS(monthly,quarterly,semi-annual,annual). The investor buys more shares when the price is low and fewer shares when the price is high;the overall cost therefore is lower than it would be if constant number of shares were bought at sest intervals(compare it to buying stocks using min lot size).


it is widely used already in the US unlike here in the Phil, where Filipinos lack financial knowledge and options on where to invest their money. When they think of saving, sa banko kagad ang iniisip nila. Also, in general, it is diffucult and it takes discipline to save REGULARLY.

any thoughts or any ppl out there who has mf accounts that do DCA? :)

Yes, exactly - check out the DRIP thread. (http://www.pinoyexchange.com/forums/showthread.php?p=9991232#post9991232)

By doing this, you also save money by not paying brokerage fees.

*okay*

[Spyfrat]

boss snop, unfortunately, walang automatic drip ** sa pinas. may boardlot kasi unlike in merika u can buy kahit 1 share.
dca i think diff sa drip coz drip uses cash div to acquire more shares. sa dca habang bumababa ang stock u keep on averaging down. magaglit ka kaya bossing if i dont advocate here in pinas? sensya ha, kasi habang bumababa ang stock lalong lumalaki ang talo mo. mahirap mag average down sa pinas lalo na kung dehins malalim ang bulsa natin. usually bumibili ang investor dahil sa price. for me mahirap yan, whenever i had the chance sa mga seminars i always emphasize that investing in the pinas market is not about buying the low and selling at the highs. it's about being nyscn with the market. buy the trend ika nga, not the price. same rin sa selling.

[travy]

guys, if u have P50,000 excess cash, n thinking of investing that money. what investment vehicle will u choose? stocks, mutual fund etc. pls. advice. also, how can one invest in mutual funds? is it worth it?

[snop]

boss snop, unfortunately, walang automatic drip ** sa pinas. may boardlot kasi unlike in merika u can buy kahit 1 share.
dca i think diff sa drip coz drip uses cash div to acquire more shares. sa dca habang bumababa ang stock u keep on averaging down. magaglit ka kaya bossing if i dont advocate here in pinas? sensya ha, kasi habang bumababa ang stock lalong lumalaki ang talo mo. mahirap mag average down sa pinas lalo na kung dehins malalim ang bulsa natin. usually bumibili ang investor dahil sa price. for me mahirap yan, whenever i had the chance sa mga seminars i always emphasize that investing in the pinas market is not about buying the low and selling at the highs. it's about being nyscn with the market. buy the trend ika nga, not the price. same rin sa selling.

Spymasterguru,

Ako magagalit? Nagagalit ba and estudiante sa titser? Of course not! Tama ka dyan. Iba ang DRIP US style from Phisix buy and sell. And DCA means Dollar Cost Averaging so not applicable here. To o8si5, I stand corrected.

That's why I'm trying to learn how to invest sa Pinas using your TA charting techniques. Kung baga, "When in Rome, do as the Romans do." Be patient with me. I'm a slow learner. Still poring into them books of Nison, Edwards and Magee, et al. Any tidbits from you is very much appreciated.

Napansin mo rin pala yun tampo post ko on PHI sa FM ha? Thanks for the response.

:)

Regards to the family..hope everything is well with you all! God bless!

[Haloperidol]

hi there... I wanna know please what's the difference between mutual funds and uitfs and what would you recommend to newbie investor dollar,bond or balance,I'm talking about the sunlife's products but the question can apply to other companies as well, thanks.


what a nice thread

[travy]

how can one invest in UITF? is it better than mutual funds in terms of % return?

[nmsgmd2]

This is a very informative thread. I'm just curious, can someone please clarify to me the concept of "yield"/YTD? I just noticed from the previous posts that most mutual funds have an average of 4-8% yield. Some even have negative yields and rarely those which have >20% yield.

The reason I am asking this is if I have P50,000, why would I invest it in mutual funds with "only" 8% yield, if I can place it in a time deposit account which guarantees 6-7% per annum? If mutual funds involve the so-called risks, then I would expect the average yield to be somewhere between 15-20% per year. It's kinda pointless to put your money at risk if there is only a fraction of difference between the safer time deposits.

[knightrader]

boss snop, unfortunately, walang automatic drip ** sa pinas. may boardlot kasi unlike in merika u can buy kahit 1 share.
dca i think diff sa drip coz drip uses cash div to acquire more shares. sa dca habang bumababa ang stock u keep on averaging down. magaglit ka kaya bossing if i dont advocate here in pinas? sensya ha, kasi habang bumababa ang stock lalong lumalaki ang talo mo. mahirap mag average down sa pinas lalo na kung dehins malalim ang bulsa natin. usually bumibili ang investor dahil sa price. for me mahirap yan, whenever i had the chance sa mga seminars i always emphasize that investing in the pinas market is not about buying the low and selling at the highs. it's about being nyscn with the market. buy the trend ika nga, not the price. same rin sa selling.

That is true even in the USA. To average down in individual stocks is a no-no for technical traders unless you are trading intraday movements. For swing traders, averaging up makes more sense with fewer shares so you have an upright pyramid (stronger base) and established trend on your side. For position trades (using 1-2 year charts with weekly/monthly bars), however, it's OK to add to a bounce off a support level as position trades are used to build wealth as oppposed to generating income with day or swing trades.

Averaging down in individual stocks is tricky as the company can go out of business! You will average down to zero! For mutual funds in the right sector with a good manager, then adding on dips will work as the manager will mix and change the portfolio as needed. Still, watching the charts for any type of trading or investing is prudent.

[o8si5]

This is a very informative thread. I'm just curious, can someone please clarify to me the concept of "yield"/YTD? I just noticed from the previous posts that most mutual funds have an average of 4-8% yield. Some even have negative yields and rarely those which have >20% yield.

The reason I am asking this is if I have P50,000, why would I invest it in mutual funds with "only" 8% yield, if I can place it in a time deposit account which guarantees 6-7% per annum? If mutual funds involve the so-called risks, then I would expect the average yield to be somewhere between 15-20% per year. It's kinda pointless to put your money at risk if there is only a fraction of difference between the safer time deposits.

You have a point po. In investments or finance, they say, LOW RISK=LOW RETURN. HIGH RISK=HIGH RETURN. It all depends on your investment objective and how long you intend to park your money. BOND FUNDS can earn you or yield a return from 6-8% depending on the performance of the fund manager. EQUITY FUNDS or those mutual funds which have stock or equities in its portfolio can yield higher. Time deposits have terms and are TAXED. While mutual fund earnings are measured by Yields and are TAX-FREE.

[Brix99]

ei guys do you know any good mutual funds that don't charge as high as 2% sales load fees? i read in one forum that the 2% is too high.

[tidus1203]

I would suggest that mag UITF ka na lang kaysa mutual funds. Kasi mutual funds have a lot of charges and they are governed by the SEC whilst the UITF's have a fix trust fee and they play with different rules cause they're regulated by the BSP instead being a bank product....

[DaNa8]

^^^
Wouldn't it be putting all your eggs in one basket? You already have money in the bank and you still invest in a bank's UITF.

[DaNa8]

Mutual funds are going to be valuated mark-to-market come Sept next year. I heard that this will affect even banks so the pa interest they can guarantee by then will just be 2%. Is this true?

And it's official, Philam's Bond fund and Dollar Bond fund are accepting new and additional investment only until end of Sept this year. This is to prepare for the mark-to-market valuation. They will offer new investment products in place of the bond funds. I'm kind of hesitant to migrate my bond fund investment to the new mark-to-market valuated products. Will there be much change after that, like how risky will it be compared to the bond fund?

[tidus1203]

^^^
Wouldn't it be putting all your eggs in one basket? You already have money in the bank and you still invest in a bank's UITF.

Putting your eggs in one basket means diversifying investments. If you know naman malakas bangko mo (in my case Banco de Oro) it wouldn't matter di naman speculative yung ginagawa ko eh.

[bi0hazard]

Mutual funds are going to be valuated mark-to-market come Sept next year. I heard that this will affect even banks so the pa interest they can guarantee by then will just be 2%. Is this true?

are you referring to the bank's UITF's? if so, marked to market na sila

[bi0hazard]

I would suggest that mag UITF ka na lang kaysa mutual funds. Kasi mutual funds have a lot of charges and they are governed by the SEC whilst the UITF's have a fix trust fee and they play with different rules cause they're regulated by the BSP instead being a bank product....

aside from the annual trust fee, may hidden charges pa ba ang UITF? sa mutual funds kasi, usually starting sa 2nd year yung sulit since yung yield mo for the 1st year nabawasan ng sales load/entry fees.

meron ba local mutual funds na walang sales load? in some overseas markets kasi they frown on the sales load and most users are advised to insist on "no load"...

[tidus1203]

I dunno as far as I know la nang hidden charges yung UITF kasi talagang fixed fee lang charges nila. No entry and exit fees... Anyway, iba kasi regulations ng BSP mas linient sila. In fact kakaredeem ko nung money market fund ko to transfer to bond fund gulat ko na lang di ako tinaxan nang bangko. As in yung ano yung NAVpu nung araw na yun multiply dun sa units ko yun yung nakuha kong value la nang tax deduction eh 2.5 months ko lang hinawakan yun.....

[bi0hazard]

I dunno as far as I know la nang hidden charges yung UITF kasi talagang fixed fee lang charges nila. No entry and exit fees... Anyway, iba kasi regulations ng BSP mas linient sila. In fact kakaredeem ko nung money market fund ko to transfer to bond fund gulat ko na lang di ako tinaxan nang bangko. As in yung ano yung NAVpu nung araw na yun multiply dun sa units ko yun yung nakuha kong value la nang tax deduction eh 2.5 months ko lang hinawakan yun.....

as far as i know, as long as you meet the minimum holding period (what is it these days, 30, 45 days?), wala na additional fees/taxes... with regards to the other taxes, i believe this is already factored in the computation of the NAVPU, as is the case with with mutual funds.

so i take it there's just the annual fund fee to be considered, not bad. i used to invest in bdo's CTF before i moved my investments to philam's mf, pero gusto ko rin try yung UITF for my succeeding investments... parang mas attractive kasi right now yung UITF speciall when i think of the entry/exit fees ng mutual funds coupled with the long-term holding period

[tidus1203]

UITF holding period is 30 days only.....

And I like the yields of the UITF, last month nasa 24% yung performance ng Bond Fund so not bad talaga thats even better than the best of government bonds.

[thehitman]

which particular uitf of bdo are you investing in? sobrang iffy na ako mag-invest sa psgf ng philam nung makita ko na mataas ang 2% sales load...5% kasi ang charge sa akin e

:cool:

[bi0hazard]

UITF holding period is 30 days only.....

And I like the yields of the UITF, last month nasa 24% yung performance ng Bond Fund so not bad talaga thats even better than the best of government bonds.

how did you arrive at that yield? if you started investing in bdo's peso bond fund from day 1 (april 1), your yield as of sept 12 is only 8.65%... pano naging 24%?

[bi0hazard]

which particular uitf of bdo are you investing in? sobrang iffy na ako mag-invest sa psgf ng philam nung makita ko na mataas ang 2% sales load...5% kasi ang charge sa akin e

:cool:

philam fund yung best performing nila na fund, hindi yung philam strategic growth fund...

[tidus1203]

how did you arrive at that yield? if you started investing in bdo's peso bond fund from day 1 (april 1), your yield as of sept 12 is only 8.65%... pano naging 24%?

But that 8.65% is FROM APRIL 1 - AUGUST 31. That's only 4 months. So 8.65% in 4 months ain't bad. I am talking about annualized yield kasi we used per annum when talking about yields. That 8% is the ACTUAL YIELD SO FAR...

I took the MOM (Month on Month) for Aug 31 yield, its in their website...

[tidus1203]

TO prove the point of BDO's money market fund I will give you a computation of my investment there. Di ko pa ma say sa Bond Fund kasi kakalipat ko lang.

Initial Pricipal = P2,058,342.36
Date started = July 19, 2005
# of units = 1993.766264
NAVpu on start date = 1032.3886
Date Left the Fund = August 30, 2005
NAVpu on redemption = 1047.7667
Value on redemption = P2,089,001.899

P2,089,001.899 - P2,058,342.36 = P 30,659.539 (The amount I gained from that span of time 43 days)
P30,659.539/P2,089,001.899/43*360 = 12.2874% per annum

THATS MONEY MARKET FUND, pero BOND FUND is actually higher.... kaya nilipat ko sya dun sa bond fund...

[thehitman]

bio: I invested in psgf for the long run and I made my initial investment early 2004. Anyways, the performance has been good up to this point but I'm iffy on making an additional investment due to the 5% load. Especially now after reading that 2% is already high...

:cool:

[o8si5]

aside from the annual trust fee, may hidden charges pa ba ang UITF? sa mutual funds kasi, usually starting sa 2nd year yung sulit since yung yield mo for the 1st year nabawasan ng sales load/entry fees.

meron ba local mutual funds na walang sales load? in some overseas markets kasi they frown on the sales load and most users are advised to insist on "no load"...


in the U.S they have "Rights of Accumulation/ROA" and "Letter of Intent/LOI". " Rights of Accumulation" is somewhat applied here in the Phil. This is when you invest at a certain breakpoint level, say P100k, you get a lower sales load than when you invest say anywhere from P5k-P99,999. All existing investments and add-ons "accumulate" to reach a breakpoint, and gives you a "right" in getting a lower sales charge as an incentive to putting more money. NO LOAD FUNDS are really popular also in the US but some of these funds have fixed transaction fees(fixed $ amount) when you enter and/or fixed redemption fee(usually in %). *okay*

LOI, by the way, is when the investor makes a commitment by signing a letter to the (mutual)fund company to purchase a certain or fixed $ amount over a peroid of time (13mos. or less) If the LOI has been made( amount stated in the letter has been reached), then an adjustment in the sales charge will be made. That's the diff. between ROA. In ROA, the investor get the lower sales charge at the time of investing. In LOI, the investor gets the lower sales charge upon the fulfilling the LOI. *okay*

[bi0hazard]

But that 8.65% is FROM APRIL 1 - AUGUST 31. That's only 4 months. So 8.65% in 4 months ain't bad. I am talking about annualized yield kasi we used per annum when talking about yields. That 8% is the ACTUAL YIELD SO FAR...

I took the MOM (Month on Month) for Aug 31 yield, its in their website...

but the annualized yield for the bond fund is at 19.xx% right? para saan ba yang MOM?

but agree, the bond fund is performing well so far... gusto na nga ng mrs ko maginvest dun

[bi0hazard]

o8si5: agree, at least for philam, i believe they have roa... there are certain tiers wherein the more you invest, the less sales load you pay. i believe for the bond fund it can be as low as .5%, a bit higher for others.

is the loi applicable here in our country?

[bi0hazard]

bio: I invested in psgf for the long run and I made my initial investment early 2004. Anyways, the performance has been good up to this point but I'm iffy on making an additional investment due to the 5% load. Especially now after reading that 2% is already high...

:cool:

taas nga ng 5%

[DaNa8]

are you referring to the bank's UITF's? if so, marked to market na sila

I'm referring to bond funds. How much yield ang guaranteed in bank's UITF's?

[bi0hazard]

I'm referring to bond funds. How much yield ang guaranteed in bank's UITF's?

you were saying na banks will be affected kaya i assumed you were referring to the bank's UITF's.. so i guess you were referring to their deposit accounts eh?

guaranteed? i refer you to the following excerpt from the bank's disclaimer:

<snipped> The BDO UITFs are not deposit accounts but trust products and are not guaranteed nor insured by BDO, its affiliates or subsidiaries. Investment or participation in the BDO UITFs are subject to risk and possible losses of principal. The value of the investments can go up or down and, upon redemption, may be worth more or worth less than the original amount invested. <snipped>

[tidus1203]

but the annualized yield for the bond fund is at 19.xx% right? para saan ba yang MOM?

but agree, the bond fund is performing well so far... gusto na nga ng mrs ko maginvest dun

Yung 19++% is yield if you holded it from April - August

Yung 24++% is effective if you hold it from July - August. Kung baga that 1 month period the fund performed a 24++% annual yield.....

[tidus1203]

Just like a mutual fund, a UITF IS NOT GURANTEED IN ANY WAY as BDO disclaimed. But not just BDO all UITF's are considered investments and NOT DEPOSITS... So no PDIC!

[jw44]

tidus,
wala kang binayaran na 0.5% na trust fee nung kinuha mo na yung nasa money-market mo???

[tidus1203]

Wala, as in walang bawas maskin tax. Talagang NAV * # of units ang nakuha ko. Pero siguro nacompute na ng BDO yan sa NAV nila....

[jw44]

tidus, hindi kaya nawala lang sa isip nila yun?
recommend mo din ba ang $$$ uitf nila???
matatapos na kasi yung $ time deposit ko sa union bank e.. namonitor mo din ba ang $$$??? tnx

[tidus1203]

Well nawala man yun sa isip nila or hindi, eh nacredit na yun sa savings account ko eh tapos dinebit ko papuntang Bond FUnd so definitely di na nila maayos yun. Pero I think they are too professional for such a mistake like that, masyadong mababaw.....

Their $$$ is actually pretty good, its just like buying a ROP bond yourself.... I suggest the $ Bond Fund. Wag ka na mag time deposit, napakasayang sa panahon nyan 4% lang ata dollar time deposit eh tapos 3 months pa ata yun....

[jw44]

plano ko nga rin $ bond fund ilagay e... buti nalang monthly lang ang $ time dep ko. 3.33 p.a. for a month sa unionbank... next week mature na siya at pasok ko nalang siya asap. nag-monitor ako sa performance niya for the past 2 weeks and it's doing pretty well...

kung wala nga fees, e di pwede ka palang maghulog kahit monthly ng additional investments ano??? may downside ba ang plano ko??

[tidus1203]

You cannot make additional investments. What you could do to make additional is to first pull out the money so they will give you the value of the NAV for the day * # of units you have. Then isama na lang yung additional investment ulit tapos reinvest.

Or just get a separate paper for the new investment nalang if it meets the minimum requirements. My suggestion is to open a BDO savings account para mabilis macredit kaysa MC-MC pa.

Oh yeah, you have to tell them one day in advance in order to redempt.

[bi0hazard]

Yung 24++% is effective if you hold it from July - August. Kung baga that 1 month period the fund performed a 24++% annual yield.....

tidus, can you show me the formula on how this is derived (kahit pm na lang)? the yield i was able to derive for the 31-jul-2005 to 31-aug-2005 period is just shy of 20%. thanks!

what's the purpose of this MOM figure? it's not that useful to me

[tidus1203]

I dont have the NAV from July 31 so I cant show you how to compute for it.... I started placing on the Bond Fund on AUg 31 so di ko macocompute. Unless you can give me the info?

MOM means that for that specific month the fund performed that well.... Of course in annualized yield as yield is often expressed in annums.

[o8si5]

o8si5: agree, at least for philam, i believe they have roa... there are certain tiers wherein the more you invest, the less sales load you pay. i believe for the bond fund it can be as low as .5%, a bit higher for others.

is the loi applicable here in our country?


i cant find any mutual fund company in the Phil that applies LOI. It is commonly used already in the mf industry in the U.S. :)

[o8si5]

bio: I invested in psgf for the long run and I made my initial investment early 2004. Anyways, the performance has been good up to this point but I'm iffy on making an additional investment due to the 5% load. Especially now after reading that 2% is already high...

:cool:

An option is to make an EXCHANGE/TRANSFER to another fund within the same fund family. From PSGF you can move partial/full of your assets to PBF or PF w/o the exit fee(from the "FROM" fund-->PSGF)) and w/o sales or entry fee(TO THE "TO" Fund-->PBF or PF). :) This is to "LOCK IN" your gains. If you have reached a certain breakpoint level then the subsequent investments qualifies for breakpoints or reduced sales load. How much do you have existing in the PSGF, if you dont mind me askin. You can just mention the range.. :)

[DaNa8]

you were saying na banks will be affected kaya i assumed you were referring to the bank's UITF's.. so i guess you were referring to their deposit accounts eh?

guaranteed? i refer you to the following excerpt from the bank's disclaimer:

<snipped> The BDO UITFs are not deposit accounts but trust products and are not guaranteed nor insured by BDO, its affiliates or subsidiaries. Investment or participation in the BDO UITFs are subject to risk and possible losses of principal. The value of the investments can go up or down and, upon redemption, may be worth more or worth less than the original amount invested. <snipped>

I'm actually referring to a bank's time deposit. I heard that they will be able to guarantee 2% yield only when all mutual funds get valuated mark-to-market.

Ok, I shouldn't have used the term guaranteed. What's the projected yield of UITFs then?

[tidus1203]

UITF's projection is very dependent on which bank.....

[Brix99]

magkano minimum investment sa UITF ng BDO?

[tidus1203]

P100000 for the Bond Fund and the Money Market Fund
P10000 for the Balanced Fund

$2000 for the Dollar Money Market and Bond Fund's

[Brix99]

wow.. ang laki pala ng kailangan.

mas maganda ba ang returns ng MMF vs. BF?

[tidus1203]

Bond Fund by quite a lot. Around 2X more ang bond fund than money market fund. Pero mas malikot yung bond fund, kasi mga long term debt securities yan eh and more susceptible to interest rate variations than short term debt securities....

[Brix99]

with uitf entering the picture i'm kinda lost where to put my 10k.. i know it's not much but it's still hard earned money that i want to invest and earn at it's full potential.

so the question remains: Mutual funds or UITF? pros and cons please. help me decide. thanks. :)

[tidus1203]

Ang obvious advantage of UITF over mutual funds is its lack of load.... It also dosen't have entrance and exit fees... And it could mean a lot sometimes.... Mataas nga lang requirements ng UITF in terms of minimum investment.

[thehitman]

o8si5: 30K pa lang.

Thinking about investing in a UITF...

:cool:

[DaNa8]

Bond Fund by quite a lot. Around 2X more ang bond fund than money market fund. Pero mas malikot yung bond fund, kasi mga long term debt securities yan eh and more susceptible to interest rate variations than short term debt securities....

Are all UITF'S already valuated mark-to-market? So this Bond Fund is different from Mutual Fund Bond Funds? Because the latter guarantees positive yield, there's no way that its NAVPS will go down. I'm quite confused because MF Bond Funds also have long term debt and government securities.

[tidus1203]

Are all UITF'S already valuated mark-to-market? So this Bond Fund is different from Mutual Fund Bond Funds? Because the latter guarantees positive yield, there's no way that its NAVPS will go down. I'm quite confused because MF Bond Funds also have long term debt and government securities.

Yes its already mark-to-market as stipulated by the BSP among UITF issuers. The UITF DOES NOT GURANTEE POSITIVE YIELD. In fact, if the fund doesn not do well so will its NAV and so will your shares. Capital loss is a possibility.... But with that in mind, it makes UITF more attractive as far as yields are concerned.

[DivineFist]

oo nga,medyo naghilo ako sa process dito sa manila. kasi sa US, internet lang katapat nito......

sana maapprove *** PERA bill sa Phils. ito *** equivalent ng tax deferred accounts/401k dito sa US. dito mag aapply yung Pay urself First, kasi makukuha mo *** pera n wala pang bawas ng tax..after mong mahulog *** money sa account,saka palang papasok *** tax deductions..

These are the kind of laws that our dear congressman should pass instead of bickering. I heard of this two years ago, but unfortunately, I haven't heard any updates about the PERA bill. I guess it's dead in the water.

[Haloperidol]

Para sa mga below 100k RCBC's UITF starts at 25k to 50k.
BDO told me to keep the account for six nonths after the 30 day period para daw stable.

[tidus1203]

Yeah tama sila, in order to really reap the benefit of the UITF mga 6 months dapat pero if you can go for a year then why not??

[DaNa8]

How about BPI, do they offer UITF? What's the best UITF out now? I'm thinking of where to put my money when Philam stops offering their Bond Fund.

[KuyaDanny]

There are eight UITFs offered by BPI - five peso and three dollar-denominated.

[napalmdog]

lets say i invested 20k on a UITF (ex. BDO) for 6mos. can you give me an estimate how much % i can earn? just a rough estimate. thanks!

hirap masundan nung thread di ko maintindihan hehehe. i did not do so well in accounting in school hehehe

[KuyaDanny]

Nobody will tell you what you can or will earn. The best you can do is to get a report and find out how your fund earned in the past. That will only give you an idea, but even then do not count on that figure as an assurance of future earnings.

[Fortune]

what will happen to the PHILAM funds once IAS is implemented
di ba accrual yun
mag mark-to-market ba sila?
ano kayang effect sa funds nila?

[day2wakenow]

@napalmdog

i believe the BDO UITFs have only been in existence since April 2005. for 20k pesos, there are two BDO UITFs in which you may invest: Fixed-Income and Balanced Fund.

based on its short historical performance, as of today, if you had invested your 20k on the date of its UITF inception (around April 30, 2005), you would have earned:

Fixed-Income -- 5.7% x 20k = 1,152 pesos
Balanced Fund -- 7.68% x 20k = 1,536 pesos

you can check for yourself the daily NAVPS (as well as historical peformance) at the BDO website.

Of course, as KuyaDanny has indicated, past performance is no guarantee of future performance. Be wary of a fund's volatility also; the balanced fund would be the most volatile (possible higher returns but with the flipside of lower negative returns) of all the BDO UITFs, as a portion of the its portfolio is invested in stock market.

[napalmdog]

ok thanks that was very helpful. btw are UITF's monthly, quarterly or annualy?

[day2wakenow]

UITF valuation fluctuates daily. Calculcation is done by multiplying the number of units invested with today's net asset value per unit (NAVPU). btw, mali yng NAVPS nasulat ko sa earlier post. for mutual funds, NAVPS; for UITF, NAVPU. pretty much just the same concept for computation purposes.

e.g., BDO fixed-income fund NAVPU for today is 1,057.6216. If you invest 20k, you would be have 18.910355 units of the UITF (20,000 divided by 1057.6216).

[thehitman]

what will happen to the PHILAM funds once IAS is implemented
di ba accrual yun
mag mark-to-market ba sila?
ano kayang effect sa funds nila?

Good question. FYI, mark-to-market na ang philam funds.

:cool:

[Fortune]

^think only their equity funds are on mtm
but not the peso and dollar bond funds
look at their navpus, still increasing at regular pace and not fluctuating especially now that interest rates are rising
how can that be???

[day2wakenow]

received a letter from philam that effective september 28 the fixed-income portion of Philam Fund (the philam balanced fund) will adopt the mtm valuation.

[DaNa8]

^think only their equity funds are on mtm
but not the peso and dollar bond funds
look at their navpus, still increasing at regular pace and not fluctuating especially now that interest rates are rising
how can that be???

Yes, the Peso and Dollar Bond Funds are still on accrual valuation. They will stop offering these by end of September this year to prepare for the mark-to-market valuation for all mutual funds next year.

[o8si5]

@napalmdog

i believe the BDO UITFs have only been in existence since April 2005. for 20k pesos, there are two BDO UITFs in which you may invest: Fixed-Income and Balanced Fund.

based on its short historical performance, as of today, if you had invested your 20k on the date of its UITF inception (around April 30, 2005), you would have earned:

Fixed-Income -- 5.7% x 20k = 1,152 pesos
Balanced Fund -- 7.68% x 20k = 1,536 pesos

you can check for yourself the daily NAVPS (as well as historical peformance) at the BDO website.

Of course, as KuyaDanny has indicated, past performance is no guarantee of future performance. Be wary of a fund's volatility also; the balanced fund would be the most volatile (possible higher returns but with the flipside of lower negative returns) of all the BDO UITFs, as a portion of the its portfolio is invested in stock market.


Did you get the 5.7% and 7.68% from their website or you just computed on your own? Where does BDO publish their YTD or performance yield? And does BDO charge any TRUST FEES, TRANSACTION FEES, or CUSTODIAL FEES? If yes, how much? Thanks! :)

[o8si5]

But that 8.65% is FROM APRIL 1 - AUGUST 31. That's only 4 months. So 8.65% in 4 months ain't bad. I am talking about annualized yield kasi we used per annum when talking about yields. That 8% is the ACTUAL YIELD SO FAR...

I took the MOM (Month on Month) for Aug 31 yield, its in their website...


If that is already NET of any fees(custodial,transaction,trust fees), then that is attractive. How about if you redeem, any taxation? :)