[bloomerman]

Alam mo ba sa banks, na pwede ka din wala ineterest like sa regular savings.. So di rin guaranteed na kung mag deposit ka sa banks, may kikitain ang pera mo..
Kung di mo naman gagalawin, may dormant fee ka pa..

Unlike sa Mutual Fund, kahit 10k lang at 7  years pa yun na di mo galawin, tiyak na kikita.. This is base on my experience..

hello kithe, in MF ba guaranteed yung principal in case of loss? sa banks kasi meron nang bagong ruling sa dormancy... Kapag dormant ang account pero may maintaining balance pa rin hindi na to magkaka-charge unlike before...

[wiggy]

in MF ba guaranteed yung principal in case of loss?

You mean what if walang kitain yung fund or the end amount is lower than your initial investment? Sa MF walang insurance. Compared to savings na covered ng PDIC, its a higher risk-higher profit investment.

[kithe]

Hi, Bloomer..

It is not guaranteed..

MF is like investing in stock market, the difference is in MF you have fund managers that manage the portfolio of the funds, different fund managers for every funds.

Compared with buying stocks directly, (like most of you here in PMT do) mutual funds require a lower initial capital outlay,yet allow you to achieve diversification at the same time (5,000 min. investment)

What this means is that in mutual funds, for a relatively small amount of money, you can afford to buy into several companies and achieve variety for your portfolio like in our Equity Funds, the equity holdings like ALI, MBTC, SMI, PLDT, Aboitiz, philex mining, ayala land, Jg summit, bdo, etc..

How are investors protected in a mutual fund?
Mutual funds offer several levels of investor protection. First, they are regulated by the Securities and Exchange Commission of the Philippines.

Second, every mutual fund corporation has a Board of Directors to whom it reports and whose primary duty is to protect investors' interests. Each fund has a different Board of Directors and each board is composed of a majority of people who are not connected with Sun Life Financial or any of its subsidiaries.

Third, mutual fund securities are held by a reputable custodian and do not form part of the assets of the company managing the fund. The custodian banks of the Sun Life Prosperity Funds include Citibank, N.A., Deutsche Bank, A.G., and Hong Kong and Shanghai Banking Corporation Limited. They keep all stock certificates and any other documents that evidence ownership of the funds' assets. The primary purpose of having a custodian is to safekeep the assets of the funds.

You can choose to the following funds depends on your risk appetite.

1. Philippine Equity Fund if  you want to maximize the potential of your money for  higher return over the long term..This Fund invests mainly in  high-quality equity securities.

2. Balanced Fund if you want your money to earn more and if you can afford to lose some of your investment for higher return. This Fund invests in a mix of  high-quality debt and equity securities..it is for somewhat between conservative and risky.

3. Bond Fund if you want your money to earn but your investment should be kept relatively stable.   This Fund invests in government and high-quality corporate debt. If you are moderately conservative.

4. GS (Government Securities) Fund if you want your money to earn but your investment should be kept intact.   This Fund invests mainly in government debt.

5. Money Market Fund    if you just want to leave your cash for a short period of time and earn from it, too. This Fund invests in special savings accounts. It is our parking fund, if you want to switch your fund.

6. Dollar Abundance Fund if you want to invest your US dollars to preserve it. This Fund invests in foreign-denominated government and high-quality corporate debt.

7.  Dollar Advantage Fund if want to invest your US dollars and If you can afford to lose some of your investment for higher return..This Fund invests in a mix of  high-quality debt and equity securities.

Hope it helps..

[xyphrus]

These are investing strategies used by fund managers to gain or secure profits right?

I guess what the TS (arlene168) is pertaining about the "absolute return" stuff, is the strategy that can be used by the investor itself and not by fund managers. Of course, there is really no guaranteed returns sa MF because this is a buy-type of investment. Ang may guaranteed returns lang, like what allanmm13 said, ay yung mga lend-type of investments like savings, time deposits, etc..  

Now, going back to the absolute return strategy, this is one of the strategy na pwedeng gamitin ng mga investors mismo. This is what I heard in a group of people before, na nag-uusap regarding mutual funds. If I remember it right, parang may "target return" ka, and then pag na-hit na yun you will pull-out your funds and then re-invest it again. Not sure lang kung lahat ba or yung tinubo/kinita lang ng funds mo ang kukunin mo. I guess ito yung tinatanong ni TS kase parang ganito yung topic na narinig ko.

Is there anyone here who also heard about this kind of strategy (if ever meron nga) ?




@ kithe - thanks for that information mam about how investors are protected. Nice and clear explanation..

[bauer]

xyphrus,

an investor in a mutual fund or UITF is hard pressed to insist it an absolute return strategy, simply because, the investor do not CONTROL how the funds will be invested.  It is the job of the fund manager to create a strategy.

baka ang tukoy mo na pinag uusapan ng mga investors ay target BUY and SELL lamang at hindi ito strategy.  kung ang mga investor ay may target BUY and SELL at a target PERCENTAGE PROFIT limitado lang ang pwede nilang gawin ang mag COST AVERAGING just to meet their goals.

walang strategy masyado na kailangan pag isipan sa bagay na ito kung sa point of view ng isang investor sapagkat di naman alam ng investor kung paanong diskarte ginawa ng fund manager.

[denyx01]

MF is good for those conservative investors.. yung tipong ang pera ay galing sa hard earn money at ayaw ng risk..but in return of MF the growth of your deposits at MF, is very slow, so i wont recommend it for aggressive investors..  for me, Forex is the best for generating funds.. Especially now may mini account na launched ang company wer i trade in.. The best!! very volatile pa...
Post Merge: Jul 13, 2012, 02:07 PMI agree at Bauer.. Same lang din yan na nag invest ka na di mo control at di mo na momonitor ung tinanim mo, or na invest mo.. So what ever happen sa investment..they will leave you questionable...  

[kithe]

Pwede mo mamonitor ang MF investment mo, with Sun Life MF, every quarter po ay may pinapadala na statement of account and of course thru us MF rep we monitor our clients account and thru online account..

Madali lang naman mag compute ng absolute return.. Kung ikaw may may MF account, pwede mo computin yun..

This is base on one of my clients account:

Transaction date: March 11, 2011
Gross Investment : Php 100,000.00
Sales Load: Back end load (zero load)
Net investment: Php100,000.00
Applicable NAVPS: Php 2.5048
No. Of Shares: 39,923
NAVPS as of July 13, 2012: Php 3.1819

To compute for your absolute return;
No. Of Shares x Current NAVPS = 39,923 x 3.1819 = 127,030.99

127,030.99 - 100,000.00 = 27,030.99
27,030.99 / 100,000 = 0.2703 x 100 = 27.03%

Absolute Return is 27.03% and if you are happy about it, you can redeem it or just the profit only..

[richpulubi]

Pwede mo mamonitor ang MF investment mo, with Sun Life MF, every quarter po ay may pinapadala na statement of account and of course thru us MF rep we monitor our clients account and thru online account..

Madali lang naman mag compute ng absolute return.. Kung ikaw may may MF account, pwede mo computin yun..

This is base on one of my clients account:

Transaction date: March 11, 2011
Gross Investment : Php 100,000.00
Sales Load: Back end load (zero load)
Net investment: Php100,000.00
Applicable NAVPS: Php 2.5048
No. Of Shares: 39,923
NAVPS as of July 13, 2012: Php 3.1819

To compute for your absolute return;
No. Of Shares x Current NAVPS = 39,923 x 3.1819 = 127,030.99

127,030.99 - 100,000.00 = 27,030.99
27,030.99 / 100,000 = 0.2703 x 100 = 27.03%

Absolute Return is 27.03% and if you are happy about it, you can redeem it or just the profit only..

What if he sells it today?  Is there a back end sales load?  What's the net?

[kithe]

Yes, there is a back end sales load, if he decide to sell or redeem it today, since its on his 2nd year only, he will be charge 4.48% inclusive of vat.. for whatever amount he will redeem..

Net return will be, 21.34%

[richpulubi]

How long do you need to lock in so that the back end can be waived?

[kithe]

How long do you need to lock in so that the back end can be waived?

5 years lang.

Here is the schedule of Sales Load for Option B, inclusive of 12% VAT
1st year  - 5.68%
2nd year - 4.48%
3rd year - 3.36%
4th year - 2.24%
5th year - 1.12%
6th year - onward, zero load..

For the Option A or front end load;
Php 5,000 to less than 100k - 2.24%
Php 100k  less than 1M - 1.68%
Php 1M to less than 5M - 1.12%
Php 5M up - 0.56%

No more exit fee, no holding period.

[allanmm13]

MF is good for those conservative investors.. yung tipong ang pera ay galing sa hard earn money at ayaw ng risk..but in return of MF the growth of your deposits at MF, is very slow, so i wont recommend it for aggressive investors..  

Umm? MF is good only for conservative investors? .. if an investor examines his/her risk profile.Pwede syang mag fall sa conservative (MF Bond), moderate (MF Balance) or aggressive (MF equity).

for me, Forex is the best for generating funds.. Especially now may mini account na launched ang company wer i trade in.. The best!! very volatile pa...

MF vs Forex.. i wont compare them as an apple to apple.
Forex may be best for generating funds, in your opinion. Others may say their own business.
But MF was structured to attain a financial goal not 'profiteering', if we put it in a proper perspective.

Meron ako kilala, once they profit on their business (aggressive type of people na hindi settle as being employee), portion of their earnings, they put it on their MFs accounts for their retirement needs.

Base sa strategy kasi ng MFs (equity and balance MFs), they are buying portfolio of companies and no concentration of investments sa isang company (as per law, no higher than 10% ng fund). They are not allowed to invest in speculative investments like forex. So meron siya 'built in' diversification for the protection of the investors ng MF that the fund manager must abide. These protection mechanisms, may not remove the CONTROL of the fund manager about investing the money of the investor, he is, however, CONTROL by law not to do too risky/speculative investing.

I agree at Bauer.. Same lang din yan na nag invest ka na di mo control at di mo na momonitor ung tinanim mo, or na invest mo.. So what ever happen sa investment..they will leave you questionable...  

If you are doing stock investing, even on that scenario, you dont have 'control' kung ano gagawin ng management sa company you invested.  So either you investing directly or you use a fund manager, you have the same risk. The questionable siguro na pwede i-raise here is 'how competent is the fund manager'.

BTW, in case na maging incompetent ang fund manager, shareholders can replace him with another one dahil regularly namang nirereview ang performance ng fund manager. So you as investor wont be left questionable(?)
This what GSIS MF's shareholder did previosuly, kung san lumipat sila sa Philam after not so good performance of their old fund manager.

Even though, shareholders dont have 'control' if the fund manager can make the fund profitable or not, they have 'control' to replace the fund manager to stay on the objective of the fund as per its prospectus.

Post Merge: Jul 13, 2012, 05:18 PM

MF is like investing in stock market, the difference is in MF you have fund managers that manage the portfolio of the funds, different fund managers for every funds.

It may seen 'superficially' that stock investing and MF investing are similar.

But they are not, stock investing, you are limited to the exchange publicly listed companies and some corporate debts/notes, depending on your broker functionality. MF investing is wider from TD,SDA,Corporate bonds, Treasury notes/bills (for MF fixed income type) to stock investing (for MF equity fund) and anything in between (MF balanced fund)

For ordinary investor like me, i cant probably reach all of those instruments due to my limited funds. I can use a MF (in exchange for fees) to access those markets.

[xyphrus]

baka ang tukoy mo na pinag uusapan ng mga investors ay target BUY and SELL lamang at hindi ito strategy.  kung ang mga investor ay may target BUY and SELL at a target PERCENTAGE PROFIT limitado lang ang pwede nilang gawin ang mag COST AVERAGING just to meet their goals.

I think yun na nga siguro yung pinag-uusapan nila, yung parang "buy and sell" style. But since mutual fund ito at hindi isang actual stock trading na pwedeng mag buy and sell, ang tinutukoy siguro nila is sort of WITHDRAW AND REINVEST. They will withdraw their funds if the mutual fund already hit their target profit (in percentage).

Gaya na lang nung sample ni Kithe. You can still monitor your investment by just computing the NAVPS kung kelan ka nag-start and then multiply your number of shares sa latest NAVPS. So for example ang target nila is 25% return, as of July 13, 2012 (using Kithe's example) na-hit na nila yung target nila, which means pwede na nila itong kunin, and then re-invest it again. That's what I heard from them if my memory serves me right. Ang di ko lang sure is kung yung buong fund ba mismo yung kukunin or yung 25% lang na kinita. I think ito yung gustong tumbukin ni TS..

BTW, in case na maging incompetent ang fund manager, shareholders can replace him with another one dahil regularly namang nirereview ang performance ng fund manager. So you as investor wont be left questionable(?)
This what GSIS MF's shareholder did previosuly, kung san lumipat sila sa Philam after not so good performance of their old fund manager.

Even though, shareholders dont have 'control' if the fund manager can make the fund profitable or not, they have 'control' to replace the fund manager to stay on the objective of the fund as per its prospectus.

So sir, in your own opinion, pwede na ba nating masabi na ang mutual fund is a safe investment instrument? What I mean "safe" is yung hindi maglalaho yung pera mo, which usually happens pag nagsara ang isang bangko or insurance company. Tama po ba?

Kase kapag ang bank at insurance company eh nagsara, there is a possibility na hindi mo na makuha yung pera mo. Or kung makuha mo man maaaring hindi na yung actual amount na inilagak mo. But in a mutual fund company kahit pa mag-sara ito, you and all other investors can appoint another mutual fund company. So yung nabili mong shares nandun pa din. Napalitan lang yung company, pero yung shares mo pinanghahawakan mo pa rin. Tama po ba ako sir? TIA..

[allanmm13]

So sir, in your own opinion, pwede na ba nating masabi na ang mutual fund is a safe investment instrument? What I mean "safe" is yung hindi maglalaho yung pera mo, which usually happens pag nagsara ang isang bangko or insurance company. Tama po ba?

MF are SEC regulated companies. So they will be subjected to same rules and regulation like a company na mababangkarote. What do I know they have special license from SEC (license to sell investments) as part ng kanilang pagiging MF company.

They are not still safe kapag nagsara, kasi sa bank you still have PDIC to cover 500k ng iyong inipon. But probably, using common sense investing, you would choose a reputable MF company backed by a stable finance institution for your own peace of mind.

Now, insurance company na nagsara? Wala pa ata ako narinig here sa Pinas na nagsara. Probably, you are referring to ”Pre-need” company na madalas mabalita na nagsasara or nagkaka-issue, recently.

[bauer]

Now, insurance company na nagsara? Wala pa ata ako narinig here sa Pinas na nagsara. 

Oo wala ngang napabalitang na bankrupt na insurance companies pero TALAMAK ang hindi nagbabayad ng insurance claims.