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How to Invest in UITF (Unit Investment Trust Funds) - Part 2

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tyronesolee

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Hi po sa mga masters dito! I've been lurking for quite some time now in this forum and I  decided to register to ask for advice to the masters here.

I am 23 years old and I have 320k+ worth of savings na hirap kong inag-ipunan sa sobrang pagtitipid thru working for more than 2 years now now which is nakastock lang sa savings account (BPI Maxisaver and BDO), I realized na walang masyadong tinutubo ang pera ko and course inflation rates beats the interest rate of this savings account. So this time, I want to try investing naman and I want to try BDO UITF, Since first timer ako when it comes to investing, I would like to invest first 100k, 50k would be as lump sum sa BDO Equity Fund and I will park there siguro for more than a year than I'll just add up some funds pag nakita kong kumikita naman. Then the other 50k, I'll do cost averaging thru BDO -  Balanced Fund, siguro hulugan ko na lang ng 5k per month then if kumita naman dagdagan ko pa ng dagdagan even I surpassed my 50k budget since may emergency fund naman na ako. What can you advice po sakin na wala pang experience sa investing? My goal is to have atleast a decent house and lot and a car when I reach age 30 and kahit na 1million savings pwede na. Bata pa naman ako so ok lang siguro ang risk pero ayaw ko naman po na mawala bigla ang pinaghirapan ko. I save and planning to invest kasi ayaw kong maghirap pa since lumaki kami sa hirap. Any advice? Safe po ba ang UITF even equity funds? I know there is risk pero on the average? madami na ba nalugi and/or kumita sa UITF? Looking forward to your advice! Thanks po!

I salute you! Continue your savings habit and you're on your way to making your first million! :)

Be inspired with my TV guest interview at ANC On the Money below. I know you can do it bro! :)

http://www.youtube.com/watch?v=w7VWQ_xi5to


bors

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Question sirs: Are UITF's transferable? can I go to my bank and have the COP under my name transferred, for example, to my son or daughter? Thanks.


kobabear

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Question sirs: Are UITF's transferable? can I go to my bank and have the COP under my name transferred, for example, to my son or daughter? Thanks.

No. Redeem it first and re-invest under your child's name. If he/she is a minor, i believe you should be in joint account.


mxherr5

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As far as I know pag minor usually ITF(in trust for) ang gusto mong type of "ownership"(?) nung account.


Wadup

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Hi everyone, just introduce myself awhile ago and its nice to be here!
Anyway, i have an inquiry...may i know how much ang mga fees/charges etc. if magre-redeem? If it depends on the amount, pa sample na lang siguro so i have an idea.

Thanks in advance!  :thankyou:


GoodSteward

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Whats the matter with bdo bond fund? 5% drop??  1800 nalang Navpu!!!! Yari ako if thats not a typo on their site.........

https://www.bdo.com.ph/personal/investments/daily-net-asset-value


bj71

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Whats the matter with bdo bond fund? 5% drop??  1800 nalang Navpu!!!! Yari ako if thats not a typo on their site.........

https://www.bdo.com.ph/personal/investments/daily-net-asset-value

Also the bdo equity fund pa baba!

Balak ko na itigil yun EIP ko sa bdo equity until December na lang then mag open ako sa union bank large cap ba yun? Dun na lang ako mag invest monthly for the year 2014

What do you think mga partner?


mxherr5

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Whats the matter with bdo bond fund? 5% drop??  1800 nalang Navpu!!!! Yari ako if thats not a typo on their site.........

https://www.bdo.com.ph/personal/investments/daily-net-asset-value

A 5% drop would mean that you entered at around a NAVPU of 1,900
but the BDO Bond Fund's highest NAVPU in the last 5 years is just a
few points higher than 1,800 at 1,810...

Are you maybe mixing up BDO's Fixed Income Fund with the Bond Fund?
Because the Fixed Income Fund is at 1,888..


mxherr5

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Also the bdo equity fund pa baba!

Balak ko na itigil yun EIP ko sa bdo equity until December na lang then mag open ako sa union bank large cap ba yun? Dun na lang ako mag invest monthly for the year 2014

What do you think mga partner?

Big time sir, 100k per month yan kung itutuloy mo plano mo :D nkaka ingit


richpulubi

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I attended the BDO AMG investor's meeting in Manila Pen last Monday.  The BDO president Mr. Tan gave a speech, and the heads of Asset management gave their recommendations.

Basically, sell your bond funds.  Even at a loss.


GoodSteward

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A 5% drop would mean that you entered at around a NAVPU of 1,900
but the BDO Bond Fund's highest NAVPU in the last 5 years is just a
few points higher than 1,800 at 1,810...

Are you maybe mixing up BDO's Fixed Income Fund with the Bond Fund?
Because the Fixed Income Fund is at 1,888..

Holy, Big time apologies, Dont know what hit me, youre right mxherr. I was outside when I checked the NAVPU and I dont know why I kept thinking last bond fund NAVPU was 1900 and it actually bothered me and couldnt wait to get home to check...Whew....

@RP, this false alarrm has actually gotten my attention on my bond fund placements... Will consider to  redeem partially....Indeed, I have some thats on the negative... the problem is, if I redeem it, I dont know which investment vehicle I should put the funds to..

« Last Edit: Nov 14, 2013, 12:19 AM by GoodSteward »


freefront

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I attended the BDO AMG investor's meeting in Manila Pen last Monday.  The BDO president Mr. Tan gave a speech, and the heads of Asset management gave their recommendations.

Basically, sell your bond funds.  Even at a loss.

rp, the reasons daw?


richpulubi

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Well, basically they expect interest rates to start to climb, and when interest rates go up, bond funds go down.  If I remember my finance basics, every 1% increase in interest rate causes 10% decline in bond funds. 

Their basic recommendation is only buy equiity and money market. 

They'll be coming out with a gold fund, dividend yielding fund, focused equity fund.  I think they're all equity.

They also said to expect a good uptick cuz once SDA's are closed by end of novermber, P1.5 trillion pesos will look for a home...and some of that will end up in equity funds.


bauer

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I attended the BDO AMG investor's meeting in Manila Pen last Monday.  The BDO president Mr. Tan gave a speech, and the heads of Asset management gave their recommendations.

Basically, sell your bond funds.  Even at a loss.

I do not know how interest rates will rise in the next 2 years.  The FEDS guaranteed an interest rate of between 0 to 0.25% until 2015.

The monthly $85B FED buying program, which is suppose to end first quarter of 2014, is now deemed extended without a time limit.

Recently, the ECB lowered their interest by 0.25% from 0.50% due to the fear of 'deflation'.  Japan has already maintained a 0% interest for about a GENERATION.

If our local banks' see a rise in interest rates, maybe they see that our economy will experience a lower growth or that our private sector is already over leverage.  I do not see what they see at least for the next 2 years.

My conclusion......... Maintain a good mix of bonds, equity, and other financial instruments.  Worst case scenario, If bonds will fall 30% or more, then buy more bonds so your cost will be lower.  It will bless you a good number of years ahead in the future.


mxherr5

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@ freefront, I'm surprised you haven't heard about it.
There's been a lot of articles about it for a few years na
US based articles nga lang.

What with interest rates at historic lows.
But (in the US) it isn't as simple as that, as history(US)
has shown that short term interest rates are more volatile
than long term interest rates.
Yung long term interest rates don't move a lot daw.

And remember, when the interest rates rises, yung face value
lang ng bond ang nababawasan, same pa rin ang interest payments
at kung held to maturity, bale wala ang rise sa interest rates.

Had experience a somewhat similar scenario sa ABF Bond Fund.
Nag recalibrate sila ng bond prices which caused the NAV to go down
parang 3% the next day. Paper loss tuloy pero I just averaged down, back
to positive teritory ulit :D

@rp, actually its not -10%/1% rise in rates. You have to look at the duration
which is in both BPI's and BDO's fund fact sheet.

Whatever the duration is, that is how big of a loss the fund would experience
for every 1% rise in rates.

I'm excited about the new funds you mentioned.
I hope they keep with their usual practice of having low fees :D


 


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