Jump to content

Recommended Posts

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?

 

What made you think that Filipinos are not financially sophisticated . Do not generalize that Filipinos lack financial knowledge. Do you even know what you are talking about? With cost averaging, buying more shares when prices are low and buying less shares when prices are , what you get is nothing ..zero. Assuming a flat fluctuation of +2 and -2, you get zero returns. If the market is going down, you are in fact averaging down, which is a financially suicide, and the usual advice given by stupid financial advisors to amateur investors.

 

What you must do is wait for a market rebound and when indicators confirm an uptrend, average up. Meaning buy high, and sell higher.

 

Another piece of advice to fellow forumers, if you want to learn stock trading. You should buy the shares directly and not the mutual fund. There will be pains but you gain the experience and knowledge to succeed in the stock market. Read books on stock markets ( Expensive if new, butI usuallly buy them at second hand booksales).

Link to comment
What made you think that Filipinos are not  financially sophisticated .  Do not generalize that Filipinos lack financial knowledge. Do you even know what you are talking about? With cost averaging, buying more shares when prices are low and buying less shares when prices are , what you get is nothing ..zero. Assuming a flat fluctuation of +2 and -2, you get zero returns. If the market is going down, you are in fact averaging down, which is a financially suicide, and the usual advice given by stupid financial advisors to amateur investors.

 

  What you must do is wait for a market rebound and when indicators confirm an uptrend,  average up. Meaning buy high, and sell higher.

 

Another piece of advice to fellow forumers, if you want to learn stock trading. You should buy the shares directly and not the mutual fund. There will be pains but you gain the experience and knowledge to succeed in the stock market. Read books on stock markets ( Expensive if new, butI usuallly buy them at second hand booksales).

 

your thoughts are appreciated, thank you for your insights. dca is a long term tool to "minimize" or "average out" the fluctations of the market. It is true that if the market is down and you are averaging down, but the key point is that if you invest regularly over the long term, you would have lessened your losses and maximized you gains compared to just investing one time and watch it over the years. If you want to learn about stocks, yes do your research and educate yourself about stoccks. And if you want to learn about mutual funds, find out and educate yourself about mutual funds.

  • Like (+1) 1
Link to comment

A MUTUAL FUND is a fund that pools all the investors money(investments) to a "mutual" or common goal-which is to make more money. How?A professional FUND MANAGER invests the money in different investment vehicles(whether stocks, bonds, t-bills, notes,etc.). The set of all investment vehicles inside the fund compromise the PORTFOLIO of the fund and the fund manager also decides how many or how much he will allocate the money of the investors to achieve the "mutual" goal.

 

 

The mutual fund being a money-making entity is also a company and issues shares so more people can invest. You buy a share of it at price of how much the mutual fund is worth at the time you invest. The price of a mutual fund share is its net asset (total assets less total liabilities) divided by the number of shares outstanding. This figure computed and published daily, is the mutual fund’s Net Asset Value Per Share (NAVPS).

 

 

The mutual fund itself does not mature and has no term, nor does it earn iterest. BUT the PORTFOLIO(bonds, t-bills, notes, etc.) inside it does(depending on the maturities of the bonds,t-bills,notes, etc.). GAINS/EARNINGS are measured by YIELDS (1-yr.3-yr,5-yr returns..) The yield measures how it has gained over time. The yield is NON-GUARANTEED. Meaning, it is NOT a fixed rate. BUT on the other hand, the yield is TAX-FREE under the Comprehensive tax Reform Package. This is to encourage Filipinos to invest in mutual funds. The real measure of the performance of the fund depends on how good the FUND MANAGER is. The historical performance of the fund over the years tells you if you really can entrust your money to the fund manager. But remember that past performance is not indicative of future performance.

 

 

What is the catch? Since you have the expertise of a fund manager to monitor the portfolio for you, buy and sell the securities, do the investing, make sure that the fund is actually earning, the fund manager is paid through the SALES LOAD. The sales load is the cost of managing the fund, cost of marketing, and other expenses that are needed maintain the mutual fund company like any organization. It is a percentage (%) of you investment and depends on what kind of fund you want to enter.

 

In the Phil. there are 3 basic types of mutual funds.

1. Equity Fund-portfolio is mostly Phil. stocks or equities

2. Equity and Bond Fund(commonly called "BALANCED" Fund)-portfolio is combination of stocks and bonds(corporate and gov't)/government securities

3. Bond Fund-mostly government securities.

 

People who enter or invest in mutual fund have the following INVESTOR PROFILES:

1. Aggressive-people who are risk takers

2. Moderate-people who can tolerate a moderate risk

3. Conservative-people who are risk averse

 

 

I hope this helps.... IF you have any further questions or if you want to set an appointment for a FREE presentation, you can send me a PM or email me at jem.bacalzo@philamfinancials.com

Link to comment
@financial advisor

 

how much does philam charge in a mutual fund account?

 

 

THere is no annual charge or maintaining fees in a mutual fund account, but there is however a SALES LOAD or ENTRY FEE whenever you invest. For the Strategic Growth Fund Fund it is 5% of your investment(both initial and additional), the Balanced Fund is 3% and Bond Fund 2%. The sales load is the cost of managing the fund. The Strategic Growth Fund has stocks in it that is why it has a higher sales load.

Link to comment
Guest VO2_Max
THere is no annual charge or maintaining fees in a mutual fund account, but there is however a SALES LOAD or ENTRY FEE whenever you invest. For the Strategic Growth Fund Fund it is 5% of your investment(both initial and additional), the Balanced Fund is 3% and Bond Fund 2%. The sales load is the cost of managing the fund. The Strategic Growth Fund has stocks in it that is why it has a higher sales load.

 

taas naman ng charging mo ah....i was able to get from somebody sa Philam at a lower charge than what your are presenting....

Link to comment
taas naman ng charging mo ah....i was able to get from somebody sa Philam at a lower charge than what your are presenting....

 

 

The sales load decreases as you increase your investment. When you total investments reaches the next bracket, you qualify for the corresponding "lesser" load. For example, if you have 50k and open an BOND FUND account now, the sales load is 2%. If after a month you added another P50k, this additional 50k will get the 1.5% sales load because you have reached the P100k level. Meaning, it is cumulative. :)

 

 

Philam Bond Fund Sales Load/Front Load

Php5,000-Php99,999 2.00%

Php100,000-$499,999 1.50%

Php500,000-$1,999,999 1.00%

Php2,000,000 & above 0.50%

 

 

Philam Fund(Balanced) Sales Load

Php10,000-Php99,000 3.00%

Php100,000-Php249,999 2.00%

Php250,000-Php999,999 1.5%

Php1,000,000 and above 1.0%

 

 

Philam Strategic Growth Sales Load

Php10,000-Php99,999 5.00%

Php100,000-Php999,999 3.00%

Php1,000,000 and above 2.00%

Link to comment

Mutual Funds are a good balanced investment for the patient investor. You do not need a broker, you can invest and save money, why pay a middle man when you do not need to. the 20% a month, if it sounds to good to be true then it is. This is probably something illegal or close to it. I would say stay away from scams.

I have been investing in funds for many years and there are no funds doing 20% a month.

use your brain, use the internet, don't use brokers or those who say they are market smart and can beat the market because over all no one is that good.

Link to comment

brix....look at offshore funds.....the fees quoted below are astrinomical compared with other more realsitic ones.......1-2% max even for the more extravagent funds.....only accept a one off up front one time fee as well....

 

THere is no annual charge or maintaining fees in a mutual fund account, but there is however a SALES LOAD or ENTRY FEE whenever you invest. For the Strategic Growth Fund Fund it is 5% of your investment(both initial and additional), the Balanced Fund is 3% and Bond Fund 2%. The sales load is the cost of managing the fund. The Strategic Growth Fund has stocks in it that is why it has a higher sales load.

Link to comment

:uc: Money that is hard earned must be placed in a secure instrument such as time deposites. :thumbsupsmiley:

Philam Financials office, the Financial Advisory Group, is at 5F Salustiana T. Dy Bldg. in Paseo cor Perea(where you have the Philam Savings Bank). The Philam Asset Management office is in 5F Philamlife L.P. Leviste St. Salcedo Vill(near the sports club).

Link to comment
  • 2 weeks later...
:uc: Money that is hard earned must be placed in a secure instrument such as time deposites. :thumbsupsmiley:

 

 

saturn, there are many ways to invest and there are investment tools out there that suits each INVESTMENT OBJECTIVE of a person. Time deposits is one, and so are mutual funds and uitfs. Some offer higher yields, higher risk. Now you may be a conservative investor but there are people out there who want to beat inflation and can tolerate a certain level of risk in return to earning a better yield than time deposits. And mutual funds are on of them. :)

Link to comment
Mutual Funds are a good balanced investment for the patient investor. You do not need a broker, you can invest and save money, why pay a middle man when you do not need to. the 20% a month, if it sounds to good to be true then it is. This is probably something illegal or close to it. I would say stay away from scams.

I have been investing in funds for many years and there are no funds doing 20% a month.

use your brain, use the internet, don't use brokers or those who say they are market smart and can beat the market because over all no one is that good.

 

 

In the U.S, there are types of broker's who charge commissions for the products that they recommend(if the investor gets it) AND/OR they charge a fee for simple consultation. In the Phil, the latter is not really applicable. Whether you open an mutual fund account directly with the mutual fund company or thru a representative(broker/advisor/salesperson..), the same applicable sales load will be charge to your investment. In other words, all costs of managing the fund, including commissions, have already been inputed to the sales load. Brokers of mutual funds don't actually manage the fund. They just act as salesman or distributors. The fund manager on the other hand is the one who actually do the trading of securities and as you say, "beat the market".

Link to comment
@financial advisor

 

what does market to market valuation mean? and how will it affect philam's mutual funds?

 

 

To comply with the International Finance Reporting Standards(IFRS, formerly known as International Accounting Standards), all mutual funds with fixed-income portfolio must value or price the funds AT THE MARKET/CURRENT MARKET PRICE/"MARKED-TO-MARKET".

 

IFRS conversion is a global trend intended to bring about

1) higher degree of transparency

2) comparability in financial reporting(uniformity to global standards)

 

Marked-to-market valuation asseses assets on the current market price or closing market rate for that instrument. Basically, an asset is determined by the market price plus accrued interest. Any profit or loss is "booked" and the funds will start the next day with a net position This type of valuation takes into account the MOVEMENT OF INTEREST RATES IN THE MARKET. The INTEREST RATES CHANGES over time BUT the COUPON RATE(for ex. a P10,000 bond issued at 10% per annum coupon rate, 5 years maturity--->it pays a fixed 10% or P1k annually) remains FIXED after the bond is issued.

 

What is the effect of this? The key price or net position of a fixed income instrument(inside the portfolio of a mutual fund) is the relation of its COUPON vs. CURRENT MARKET OR INTEREST RATES. Meaning, when the going rate is LESS than the coupon rate, the bond's price will INCREASE above its par value. Consequently, when the going rate is MORE than the coupon rate, the bond's price will DECREASE below its par value. THESE CHANGES HAPPEN EVERYDAY and the process of pricing them daily is simply called "MARKED-TO-MARKET".

 

How does this affect the Philam mutual funds?

The Strategic Growth Fund, Balanced or Philam Fund are already currently marked-to-market because these two have equities and we all know that equities are valued at the market close. On the other hand, the Peso and Dollar Bond Fund are in preparation to be valued at the market. The tentative deadline given by SEC to all financial institutions is on Sept. 2006.

Link to comment
@ finanacial_a

 

Aside from entry fee, what other charges do you apply?

 

 

Mutual funds are really intended for midterm(2-5 yrs) and long term(5 yrs up) investors. That's why short term trading is somehow not encouraged(if you are into short term, just invest in stocks or bank products).

 

For the Philam $ and Php Bond Funds, if you redeem/sell/get partial/full of your investment LESS THAN 1 YEAR, there is a redemption fee of 1%. 1 year up, you can redeem any time w/o charges.

 

For the Strategic Growth and Philam Fund, if you redeem/sell/get partial/full of your investment LESS THAN 1 YEAR, the redemption fee is 1%. IF LESS THAN 2 YEARS(but more than 1 year), it is 0.5%. 2 years up, you can redeem any time w/o any charges.

 

Why does mutual funds, in general, charge sales load or entry fee?

The sales load is a fee paid to an investment company by a buyer of shares in a mutual fund. This covers the cost of managing the fund since you have a professional fund manager who handles the trading inside the fund's portfolio. In return, investors are entitled to investment advice from the assigned broker/advisor/agent on which fund is best for them.

Link to comment
Hi financial adviser,

 

Last year the equity market is really doing well in the Philippines but this year it is kind of just maintaining.  I notice that equity market is really doing well in the asian market.  Could you give

me some advice on what equity market will perform well

 

thanks

 

 

are you interested to invest offshore?i usually don't give investment advice or solicitation thru the internet. i set up appointments w/ clients and we discuss it. anyone who is interested to invest offshore or globally, just send me a PM. Only to those serious investors. :)

Link to comment
To comply with the International Finance Reporting Standards(IFRS, formerly known as International Accounting Standards), all mutual funds with fixed-income portfolio must value  or price the funds AT THE MARKET/CURRENT MARKET PRICE/"MARKED-TO-MARKET".

 

IFRS conversion is a global trend intended to bring about

1) higher degree of transparency

2) comparability in financial reporting(uniformity to global standards)

 

Marked-to-market valuation asseses assets on the current market price or closing market rate for that instrument. Basically, an asset is determined by the market price plus accrued interest. Any profit or loss is "booked" and the funds will start the next day with a net position This type of valuation takes into account the MOVEMENT OF INTEREST RATES IN THE MARKET. The INTEREST RATES CHANGES over time BUT the COUPON RATE(for ex. a P10,000 bond issued at 10% per annum coupon rate, 5 years maturity--->it pays a fixed 10% or P1k annually) remains FIXED after the bond is issued.

 

What is the effect of this? The key price or net position of a fixed income instrument(inside the portfolio of a mutual fund) is the relation of its COUPON vs. CURRENT MARKET OR INTEREST RATES. Meaning, when the going rate is LESS than the coupon rate, the bond's price will INCREASE above its par value. Consequently, when the going rate is MORE than the coupon rate, the bond's price will DECREASE below its par value.  THESE CHANGES HAPPEN EVERYDAY and the process of pricing them daily is simply called "MARKED-TO-MARKET".

 

How does this affect the Philam mutual funds?

The Strategic Growth Fund, Balanced or Philam Fund are already currently marked-to-market because these two have equities and we all know that equities are valued at the market close. On the other hand, the Peso and Dollar Bond Fund are in preparation to be valued at the market. The tentative deadline given by SEC to all financial institutions is on Sept. 2006.

 

Pare, I have an investment with Philam Dollar Bond fund. I want to encash it. Should I go to the Philam main office? I got this from a broker before.. so I'm not sure how to encash it. It's been with me for 2 years.. good returns. :)

Link to comment
Pare, I have an investment with Philam Dollar Bond fund. I want to encash it. Should I go to the Philam main office? I got this from a broker before.. so I'm not sure how to encash it. It's been with me for 2 years.. good returns.  :)

 

 

Yes, you can go to the Philam office in L.P. Leviste St. or if you want I can help you. My office is at 5F Salustiana T. Dy Tower in Paseo(corner Perea). You will have to fill out redemption form and it takes T+3 days for settlement. Check issued under your name and you can encash it at Philam Savings Bank. If you want my assistance, send me a PM. If not, it is :) still the same process.

Link to comment

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

×
×
  • Create New...