Mutual Funds Money Market Philippines

Truly Rich Club Review Bo Sanchez Mentoring Club [SlideShare Presentration

Do you want to be rich? Let me repeat that, with a twist... Do you want to become truly rich? I apology for asking that silly question, I know you may ask me… “Are you insane? Of course, I want to be rich!”

Below is presentation I created using MS PowerPoint and SlideShare.net [PLEASE READ] Truly Rich Club Review Bo Sanchez Mentoring Club. [DISCLAMER] Just a sort of disclaimer. For honest to goodness disclosure....You will see links pertaining to the TrulyRichClub website below [http://bit.ly/BoTRC or http://rdenal.trulyrichclub.com]. Since I am a member of this club, I want to clarify that if you signed up using those links, I will get a little monetary income as a bonus.

Truly Rich Club Review Bo Sanchez Mentoring Club from Red Denal

In his book, Bo Sanchez mentioned that… “As shocking as this may sound, it’s true. Externally, we seem to want to be rich, but internally, we’re deeply conflicted in our unconscious desires. Because our distorted core beliefs about ourselves, plus our crazy religious beliefs about money, chain us to the prison of poverty.”

I totally agree and it hits me. I am guilty with what he said, sometimes we’re being conflicted on the thing we want. Maybe because of fear and negative thinking plus some wrong ideology about money until I discovered this private mentoring club called The Truly Rich Club. Little by little this changes my mindset about money and about living a life with abundance mentality. I am telling you there are more that you can learn inside the club.

Mutual Fund Philippines Related News: Industry Assets

Industry Assets

by. HANNAH M. MURALLA, Special Features Assistant Editor

To quote a young trader in Oliver Stone’s new “Wall Street” flick, “If it weren't for people who took risks, where would we be in this world?”

Not everyone is willing to make a gamble, especially not in the financial ring, which only recently suffered from the global credit crunch. But the market’s inherent risks can be controlled, as shown by local fund managers who’ve managed to dodge the bear’s debilitating effects.

The Philippine asset management industry remained largely isolated from the global meltdown, thanks to widespread conservatism carried from the 1997 Asian financial crisis. “We’ve been quite cautious in the way we deal with the business. There were, of course, some ripples but not on the asset management sector...banks’ exposure have been relatively small compared to the size of the whole industry,” explained Rafael Ayuste, Jr., first senior vice president and trust officer of the PNB Trust Banking Group.

“Investments were focused primarily in local assets and there was little exposure, if any, to the US subprime sector,” added Michael Ferrer, managing director of ATR KimEng Asset Management. Although the assets under management of the mutual fund and unit investment trust fund (UITF) industries fell by 36% in 2008, Mr. Ferrer noted that no Philippine fund had to suspend redemptions due to lack of liquidity.

Understanding risks

Local fund managers, however, still had to reassure clients of their investments’ status. Maria Theresa Marcial-Javier, senior vice president of the BPI Asset Management and Trust Group (AMTG), recalled how the bank had to explain what was then transpiring in the financial markets and what its implications were on the global economy. “The first order of the day was to communicate how their investments were performing and that these remained safe,” she said.

These talks seemed to have worked. Ador Abrogena, executive vice president of BDO Trust and Investments Group, says that this time, clients kept still. Back in 2006, during the so-called UITF crisis, investors pulled their money out as soon as the market went down.

“Now it’s a totally different behavior; people were even placing more money as the market plunged. So when it went up, they were cashing in. We’re glad because they now know that the opportunity to make money is when the market is down,” Mr. Abrogena shared.

“Investors in general have also become more conscious of structures and the risks they’re taking. They have paid more attention to leverage levels and liquidity,” added Ms. Javier.

Take it on trust

But in the wake of the downturn, it’s not only their money that investors are tracking. According to professional services organization Ernst&Young, “the public is keeping a much closer and more skeptical eye on the financial services industry as a whole, and more particularly, on trust managers. Institutional investors are watching much more warily than was once the case.”

But if the results of a survey by financial services group ING are any indication, it appears that local fund managers still have their clients’ confidence, despite the persistent pessimism in the US economy. The quarterly poll found Philippine-based investors among the most upbeat in Southeast Asia, scoring 157 on the ING Investor Dashboard Survey, the fifth consecutive period that the Philippine index is in the black. Fifty seven percent of the 321 respondents believe the local economy improved in the third quarter, 60% are confident that the stock exchange will rise in the next quarter, and 77% think returns on their investment would increase.

“The Philippines, along with many emerging market economies, is becoming more resilient to external developments. Record-high overseas Filipino workers remittances and the strengthening of the peso against the US dollar have made a strong case for consumption-driven growth,” ING said.

Despite these bright signs, Mr. Ferrer noted that investors should expect lower dividends due to slow global growth and very low interest rates. The biggest challenge for today’s fund managers, he said, is how to deliver good returns while managing risks closely. “But there are always opportunities, such as new asset classes like commodities and currencies,” he said.

Mr. Abrogena shares this sentiment, noting how pre-crisis growth levels are becoming clearer on the Asian front. “Emerging Asia is the favorite [of investors] because all the other regions are not expected to grow as much anymore. The US and Europe’s populations are not increasing, they’re drawing on their savings while Asia has a younger population and a lot of economic activity going on to support the growth and the emerging economic power of the middle class,” he noted.

Amid shifting market conditions, Ernst&Young suggests that asset managers capitalize on new opportunities offered by communications and information technology. PNB’s Mr. Ayuste agrees, saying that the local sector has not been able to push technology to serve its clients better.

BPI appears to be making a head start: Mario Miranda, AMTG vice president for wealth management, earlier said that the bank is looking at allowing clients to access their investment accounts on the Web, a more convenient method than having them go to a bank branch for the same task.

Source: http://www.bworldonline.com/main/content.php?id=20164

Mutual Fund Money Market News: FAMI Bullish Over Stronger Equities

FAMI Bullish Over Stronger Equities
By TPT (The Philippine Star) Updated October 26, 2010 12:00 AM

MANILA, Philippines - The First Metro Asset Management Inc. (FAMI) is bullish in the long-term prospects of higher equity prices as the Philippine and regional economies remain strong.

FAMI is the asset management unit of the First Metro Investment Corp., a wholly owned subsidiary of the Metrobank. FAMI is the fund manager of four mutual funds.

The Metrobank Group of Companies believes that the country’s gross domestic product (GDP) in the second semester will expand by 5.5 to six percent. Robust growth will be experienced in exports, manufacturing and business process outsourcing (BPOs), private construction, mining, and of course, remittances.

“The strong Philippine economy coupled with growing optimism over the new government, is supportive of higher equity prices as it attracts more funds and improves business conditions in the country,” Hector C. de Leon, executive vice president and chief operating officer of FAMI, said.

Longer-dated fixed income securities will continue to be more attractive than shorter tenors because of the country’s better-anchored inflation record and inflationary expectations. A low interest rate environment will persist until the end of the year and probably through the first half of next year.

Domestic firms are expected to continue tapping the debt market for capital, rather than take the riskier route of going public via the initial public offer (IPO), given the low interest rate environment.

Institutional and individual investors meanwhile are looking for more investment options other than the low-yielding special deposit account (SDA). One is the mutual funds managed by reputable fund managers.

FAMI manages four mutual funds invested in the equity or stock market (Save & Learn Equity Fund), the bond or fixed income market (Save & Learn Fixed Income Fund), the money market (Save & Learn Money Market Fund), and the combination equity and fixed income (Save & Learn Balanced Fund).

As expected, the yields of the equity fund has been growing by 62 percent since its inception five years ago. Its annual average yield stood at 28 percent. And the second best performer is the balanced fund, since a portion of the fund is placed in the equity market.

The balanced funds year-to-date yields stood at 59.79 percent since its formation three years ago. Thus its annual average yield is 21.22 percent.

The fixed or bond market has recorded a year-to-date yield of 8.63 percent, or a 7.24 percent yield growth since 2005. Finally, the year-to-date yield of its one-year old money market fund stood at 1.18 percent.

A mutual fund is a pool of individual and institutional investments managed by a fund manager. Initial investments can start as low as P2,000 to P5,000, making it a popular investment option for retail and institutional investors.

So far, there are 44 mutual funds, managed by nine licensed fund or asset managers. It has a counterpart investment tool in the trust funds managed by a licensed trust department of a commercial or thrift bank. The most popular trust fund tool is the unit investment trust fund.

Source: http://www.philstar.com/Article.aspx?articleId=624192&publicationSubCategoryId=74

Home Development Mutual Fund (Pag-IBIG Fund) News: P600 Advance Payment Benefitting OFWs — Binay

By MADEL R. SABATER | October 25, 2010, 6:02pm

MANILA, Philippines — The advance payment of P600 to the Home Development Mutual Fund (Pag-IBIG Fund) by departing Filipino workers may have been suspended, but Vice President Jejomar Binay said overseas Filipino workers (OFWs) should be convinced that it will be beneficial to them in the long run.

“Yung P600 na yun, kung hindi ito ang pinakamaliit, isa sa pinakamaliit na babayaran ng aalis nating kababayan [The P600 initially required among OFWs is one of the lowest, if not the lowest, amount that a Filipino worker leaving the country would have to pay],” Binay said.

He, however, said he acknowledged that the problem with implementing the compulsory payment of P600 among Filipino workers set to leave the country had become a burden because they were also concerned of other expenditures before going abroad.

He said he will continue to explain the positive effect of OFWs’ advance payment to Pag-IBIG Fund in his upcoming dialogues with Filipino migrant organizations.

Binay ordered the suspension of Memorandum Circular No. 06 Series of 2010 in August that required OFWs a six-month advance payment to Pag-IBIG as a precondition to their departure.

Binay said that it would be more convenient to them in the long run, as he reminded OFWs that it is now compulsory that they become members of Pag-IBIG Fund. Membership to the Fund used to be optional among OFWs. “Food, education, and shelter are the essentials being dreamed of by our OFWs while they are working abroad,” Binay said.

Philippine Overseas Employment Administration Administrator (POEA) Jennifer Jardin–Manalili, in a briefing to the Vice President, assured that OFWs can continue paying their Pag-IBIG membership in Philippine Overseas Labor Offices (POLOs) abroad under the Kabayanihan Program.

The program integrates various social protection services for OFWs such as access to services of Pag-IBIG Fund, Social Security System, Philhealth and POEA. The one-stop transaction system has been set up at POLOs abroad.

“Makakapagbayad ang ating mga kababayan para ma-continue nila ang membership nila [OFWs abroad can continue paying for their membership there],” Manalili said.

Source: http://www.mb.com.ph/articles/284147/p600-advance-payment-benefitting-ofws-binay

Mutual Funds Philippines Related News: PAMI-managed mutual funds reach P18 billion in August

By Ted P. Torres (The Philippine Star)

MANILA, Philippines - One of the leading fund managers for mutual funds is extremely optimistic that 2010 and 2011 will be a great year.

Philam Asset Management Inc. (PAMI) executive vice president Gina Goco-Morales said that 2010 and 2011 would record major gains for both PAMI and the country’s mutual fund industry.

Morales noted that the strongest quarter for mutual funds is the last three months of the year.

“We are already doing P3.8 billion better and it is still the third quarter, it will be a great year,” she said.

PAMI is an asset management company that manages, distributes and provides investment advisory to seven mutual funds. It is a subsidiary of the Philippine American Life and General insurance Co. (Philamlife), the country’s leading life insurance and financial company.

PAMI reported assets under management (AUMs) of the seven mutual funds it oversees are worth P18 billion as of end August 2010. At the end of 2009, the assets were worth P15.53 billion.

The biggest asset volume managed by PAMI was worth P21.91 billion recorded in 2007. The country’s mutual fund industry also reported a record P86.19 billion worth of AUMs.

One major factor for a stronger 2011, is the ability of the Aquino administration to curb or reduce corruption, and get the private public partnership (PPP) program off the ground and rolling into 2011.

“The program allows the private sector to do their stuff, and we need more foreign investments, too!” the PAMI senior executive said.

Net foreign portfolio investments surged 385 percent in the first eight months of 2010 pumping more into the local securities and equities markets $883.4 million, or about $701 million higher than the net inflow of $182.2 million in the same period last year.

“A lot of the foreign investment inflows are entering the equities market, where a lot of the securities are still under their price to equity (P/E) ratios,” Morales added.

The country’s gross domestic product (GDP) zoomed by 7.9 percent in the first six months of 2010, compared to the 1.2 percent in the same period in 2009.

But one of the major challenges is to seduce investments locked in special deposit accounts (SDAs). It is estimated that P900 billion is sleeping in low-yielding (between 2.5 to three percent) albeit secure SDAs.

Investors had become risk-averse after 2008, and it is taking time to entice them into higher-yield investments like mutual funds, trust funds, or the capital markets. Business is hoping that the bullish equities market can lure the funds.

Also adding to the industry’s woes, is government’s penchant of offering retail treasury bonds (RTBs), which lured billions of pesos away from private-run fund.

Nonetheless, PAMI executives said that they will introduce another fund in the next few months to prepare for the entry of domestic and foreign invest-ments.

The seven mutual funds managed by PAMI are: Philam Strategic Growth Fund
Inc. (PSGF), Philam Fund (PFI), GSIS Mutual Fund (GMFI), Philam Bond Fund (PBFI), Philam Dollar Bond Fund (PDBF), Philam Managed Income Fund (PMIF), and NCM Mutual Fund of the Philippines Inc. (NCMMFPI). It is also the local fund manager for the AIG Global Bond Fund Inc.

As of end August, the net asset value per share (NAVPS) of the PSGF stood at 403.47, or a year-to-date (YTD) return of a whopping 27.84 percent and a one year return of 31.12 percent, or a five-year return of 16.39 percent.

The YTD of the PFI stood at 24.07 percent with a NAVPS of 10.5647, while the GMFI reported YTD expansion of 22.31 percent.

The PBFI reported YTD gains of 4.87 percent or a one-year return of 6.12 percent.

The PDBF displayed a NAVPS of $1.1769 with YTD growth of 1.58 percent, a one-year return of 2.18 percent, and a three-year return of 2.6 percent.

Source: http://www.philstar.com

Home Development Mutual Fund News for OFWs

I came across inquirer.net and saw this news about Home Development Mutual Fund (HDMF) commonly known as PAGIBIG.

OFWs Slam 6-month Advance Payment to Pag-IBIG

MANILA, Philippines—Overseas Filipino workers and their recruiters alike are up in arms over the compulsory six-month contribution OFWs are now forced to make to the Home Development Mutual (Pag-IBIG) Fund even before they could leave to start work abroad.

The OFW group Migrante International described the mandatory contribution as another form of “legalized kotong (unjust exaction) as well as “bawal na pag-ibig (forbidden love),” puns on the original, and still popular, name of the fund, which was “Pagtutulungan sa Kinabukasan: Ikaw, Bangko, Industriya at Gobyerno.”

“This added burden is unfair, unreasonable and we question its real intent,” said Migrante chair Garry Martinez in a statement.

Martinez called on the government to stop the implementation of Republic Act No. 9679, saying that “if the President has the interest and welfare of OFWs at heart, he should first conduct consultations with OFWs before imposing more questionable and onerous fees.”

Martinez said they also plan to bring the OFWs’ opposition to the attention of Vice President Jejomar Binay, chair of the Housing and Urban Development Coordinating Council.

The Philippine Overseas Employment Administration recently issued a memorandum compelling OFWs to pay, upon registration and deployment, an initial membership contribution of P600 for six months as a prerequisite to the issuance of their Overseas Employment Certificate.

The circular became effective on Aug. 1 as a result of RA 9679, or the Home Development Mutual Fund Law of 2009, which places informal sectors under mandatory Pag-IBIG coverage.

Martinez said RA 9679 states the fund should come from the “mandatory contribution support of the employers.”

It also states that “failure or refusal of the employer to pay or remit … shall not prejudice the right of the covered employee to the benefits.”

He said the law became “muddled and misleading” in its implementing rules and regulations.

“These irregularities once again entail the virtual passing on of fees meant for the employers to the OFWs. Despite what is clearly stated in the law, the government unfortunately has no soundproof mechanism to ensure that the employers would pay their share. Moreover, can we really count on the employer to pay the contribution of the OFW since, sometimes, the employer would not even pay wages?” he said.

For its part, the Philippine Association of Service Exporters Inc. said it had no objection to the mandatory Pag-IBIG membership for OFWs but to the implementing rules.

Pasei president Victor Fernandez Jr. said Pag-IBIG was a way for OFWs to save for the future, build assets and provide a tangible “sense” or reason for working overseas and making worthwhile their sacrifice of being away from their loved ones.

What Pasei objects to is why overseas employers are being used as membership implementors and why the compulsory contribution is tied to the processing and documentation of OFWs' travel papers, he said.

"Why will the OFWs be deprived of their right to employment if they do not pay before their departure? Why can’t they just be made a member before departure and be made to pay when they are onsite?" he said.

Fernandez also wondered how the six-months advance payment figure was arrived at. "Why not three months? Why not one year in advance? Why not payment depending on the duration of the contract? Why not monthly paid by beneficiaries instead?" he said.

He said the law did not specifically provide for the advance compulsory contribution "because it was not intended" to be that way.

"There is a cosmetic agenda here," he said.

Furthermore, Martinez said, the OFWs were being forced to make contributions when they were not even assured of receiving housing benefits. He cited a section of the law that states that only members with the “ability to pay” would be granted housing loans.

“How will the fund’s board of trustees determine if OFWs have the ability to pay? It now appears that not all who pay can avail of a housing loan. What if you’re just an OFW with small earnings or a contractual employee and cannot afford the monthly amortization? You’re paying for nothing. This is really an illegal exaction,” Martinez said.

Source: Jerome Aning of Inquirer

How do mutual funds work?

A mutual fund is a company that pools investors' money to make multiple types of investments, known as the portfolio. Stocks, bonds, and money market funds are all examples of the types of investments that may make up a mutual fund.

The mutual fund is managed by a professional investment manager who buys and sells securities for the most effective growth of the fund. As a mutual fund investor, you become a "shareholder" of the mutual fund company. When there are profits you will earn dividends. When there are losses, your shares will decrease in value.

Mutual funds are, by definition, diversified, meaning they are made up a lot of different investments. That tends to lower your risk (avoiding the old "all of your eggs in one basket" problem).

Because someone else manages them, you don't have to worry about diversifying individual investments yourself or doing your own record keeping. That makes it easier to just buy them and forget about them. That's not always the best strategy, however -- your money is in someone else's hands, after all.

Since the fund manager's compensation is based on how well the fund performs, you can be assured they will work diligently to make sure the fund performs well. Managing their fund is their full-time job!

Mutual funds can be open-ended or closed-ended. But many people consider all mutual funds to be open-ended, while putting closed-ended funds in another category.

"Open-ended" means that shares are issued in the fund (or sold back to the fund) whenever anyone wants them. With closed-ended funds, only a certain number of shares can be issued for a particular fund, and they can only be sold back to the fund when the fund itself terminates. (You can sell closed-ended funds to other investors on the secondary market, though.)

Load refers to the sales charges added to a mutual fund when you purchase it. The load charge goes to the fund salesperson as a commission and payment for their research services. Load charges can be up to 8.5 percent of the selling price and can be figured in as a front-end load (meaning you pay it when you buy the mutual fund) or a back-end load (meaning you pay when you sell the mutual fund).

Many mutual funds are no-load funds. Yes, that means there is no sales fee charged and the fund is direct-marketed so you can buy it without the help of a salesperson. With the wealth of information on the Internet today, it is certainly easier to make smart choices yourself to save money.

In addition to no-load funds, there are also funds that charge up to 3.5 percent as a sales fee. These are called low-load funds and can still be a good deal.

Mutual funds fall into three categories:

Equity funds are made up of investments of only common stock. These can be riskier (and earn more money) than other types.
Fixed-income funds are made up of government and corporate securities that provide a fixed return and are usually low risk.
Balanced funds combine both stocks and bonds in the investment pool and offer a moderate to low risk. While low risk may sound good, it is also accompanied by lower rates of return-meaning you risk less, but your investment won't earn as much. You have to decide how much risk you're willing to take on before you invest your money.

If you have invested in a college savings fund or a 401k account, chances are good that already own a few mutual funds. Mutual funds are great for long-term investments like these. You can also buy mutual funds directly from a mutual fund company.

Most of these offer no-load funds (or sometimes low-load funds). You can find lists of mutual fund companies on the Internet and purchase shares by simply filling out an application and mailing a check. Once you are a shareholder, you will receive statements telling you how the fund is doing as well as how much your own investment is growing. You can also set up monthly bank transfers to automatically buy more shares every month.

Remember to do your research and select a mutual fund that fits the level of risk you are willing to take with your hard-earned cash. Then just sit back and hope for the best!

For more information on investing and financial planning, check out the links on the next page.

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Here's another article about the subject:

How Mutual Funds Work

Every mutual fund has a goal - either growing its assets (capital gains) and/or generating income (dividends) for its investors. Distributions in the form of capital gains (short-term and long-term) and dividends may be passed on (paid) to shareholders as income or reinvested to purchase more shares. For tax purposes, keep track of your distributions and cost basis of purchased/reinvested shares.

Like any business, mutual funds have risks and costs associated with returns. As a shareholder, the risks of a fund and the expenses associated with fund's operation directly impact your return.

Returns

As an investor, you want to know the fund's return-its track record over a specified period of time. So what exactly is "return?"

A mutual fund's return is the rate of increase or decrease in its value over a specific period of time usually expressed in the following increments: one, three, five, and ten year, year to date, and since the inception of the fund. Since return is a common measure of performance, you can use it to evaluate and compare mutual funds within the same fund category. Generally expressed as an annualized percentage rate, return is calculated assuming that all distributions from the fund are reinvested.

Since average returns can sometimes "hide" short-term highs and lows, you should evaluate returns for a time period of several years-not just one year or less. A fund that has a high return in one year may have experienced losses in other years-these fluctuations may not be apparent in its average return. While a fund's return shows its track record, keep in mind that past performance is no guarantee of future results.

When using returns to compare funds, always use net returns. Net returns are the true returns of both load and no-load funds after deducting all costs and expenses.

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