Pooled Funds - MF / UITF

Financial Planning Philippines
Mutual Funds, Insurance, Educational Plan, Stocks, Investments
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Investing in Pooled Funds
Mutual Funds / UITF

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WHY INVEST?

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RETURNS on your SAVINGS
Net of withholding tax
Rates as of Aug 2013
Savings Deposit Rates
Amount BDO BPI MBT
0.25% 0.25%-1.5% 0.25%
Gross of 20% Withholding tax
TD Rates - 364 Days
Amount BDO BPI MBT
1k < 10k 0.500% 0.375%
10k < 50k 0.500% 0.50% 0.50%
50k < 100k 0.625% 0.63% 0.75%
100k < 500k 0.750% 0.75% 0.88%
500k < 1M 0.875% 1.00% 1.00%
1M < 5M 1.000% 1.13% 1.125%
Gross of 20% Withholding tax

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KEEPING PACE WITH INFLATION
Today’s 1Mil will be worth 1.6Mil in 10 years.
If you want to maintain today’s cost of living
into the future, then you must keep pace with
inflation.
1,000,000
Today
1,628,895
in 10 years
Assumed annual inflation is 5%
100

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KEEPING PACE WITH INFLATION
The returns on your savings will
not keep pace with inflation.
Save 1,000,000
in 1.125%
(gross) TD
364days
You will need
1,628,895 in 10 years
to retain the same
value
But you can only
accumulate
1,118,370 in 10 yrs
1.125% gross

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HOW IT CAN HELP YOU

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INVESTING IN POOLED FUNDS

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ADVANTAGES IN POOLED FUNDS
 Professional Management
 Diversification
 Liquidity
 Safety
 Daily Pricing
 Potential Higher Returns

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TYPES OF FUNDS
1. BOND FUND – invests in government and high-quality
debt instruments
2. EQUITY FUND – invests in high-quality listed stocks
3. BALANCED FUND - invests in diversified portfolio of
bonds and equities
4. MONEY MARKET FUND – invests in short term
government securities (SDA), time deposits, short-
term deposit agreements

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POOLED FUNDS – MF VS. UITF
Mutual Funds vs. Unit Investment Trust Funds
Mutual Funds (MF) UITF
Regulators SEC BSP
You buy Shares (NAVPS) Units (NAVPU)
Sellers Agent / MF Company Bank Personnel / Bank
Fees
Entry Fee Trust fee
Early Redemption fee Early Redemption fee
Administration fee
You are called Shareholder Investor

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ADVANTAGES / DISADVANTAGES
 MF gains are tax exempt. UITF gains are
subject to 20% withholding tax (case to case)
 Most MFs have high entry fee. UITFs have no
or very low management fee/charge.
 MFs are more transparent with shareholder
rights. UITFs are less transparent, less
regulations

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Philippine Mutual Funds / UITFs
Mutual Fund Companies UITF
ATR Kim Eng Allied Bank
First Metro Asset Mgt Inc. (FAMI) Asia United Bank
Philam (PAMI) Bank of Commerce
Philequity (PEMI) BDO
ALFM (BPI) BPI
Sun Life (SLAMC) Land Bank
Cocolife Metrobank
Grepalife BPI Odyssey
MAA PNB
Prudentialife RCBC
UCPB
Unionbank
www.pifa.com.ph www.uitf.com.ph
http://www.bloomberg.com/markets/funds/country/philippines/

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MUTUAL FUNDS – Long Term Investment

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MUTUAL FUNDS
A Mutual Fund is an investment company that pools the
funds of many individual and institutional investors to
form a massive asset base.
The assets are then entrusted to a full time professional
fund manager who develops and maintains a
diversified portfolio of security investments.

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MUTUAL FUNDS
Equity Funds
 ATRKE
• ATR KimEng AsiaPlus Recovery Fund, Inc. $
• ATRKE Alpha Opportunity Fund, Inc.
• ATRKE Equity Opportunity Fund, Inc.
 First Metro (FAMI)
 Philam SGF (PAMI)
 Philequity (PEMI)
• Philequity Fund, Inc.
• Philequity PSE Index Fund Inc.
 ALFM
• Phil Stock Index Fund
• ALFM Growth Fund
 Sun Life Equity (Sun Life)
 United Fund, Inc (Cocolife)

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MUTUAL FUNDS
Balanced Funds
 Bahay Pari Solidaritas Fund, Inc. (ALFM)
 ATRKE
 ATRKE Philippine Balanced Fund, Inc.
 Optima Balanced Funds
 Cocolife Dollar Fund Builder, Inc.
 First Metro Save and Learn Balanced Fund
 Philam
 NCM Mutual Fund of the Phils., Inc
 PAMI Asia Balanced Fund, Inc. (USD$)
 PAMI Horizon Fund, Inc.
 Philam Fund, Inc.
 Sun Life
 Sun Life Prosperity Balanced Fund
 Sun Life Prosperity Dollar Advantage Fund

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MUTUAL FUNDS
Bond Funds
 ALFM
• ALFM Dollar Bond Fund, Inc. (USD$)
• ALFM Euro Bond Fund, Inc.
• ALFM Peso Bond Fund, Inc.
• Ekklesia Mutual Fund Inc.
 ATR KimEng Total Return Bond Fund Inc. (USD$)
 Cocolife Fixed Income Fund, Inc.*
 First Metro Save and Learn Fixed Income Fund,Inc.
 Grepalife
• Grepalife Bond Fund Corporation
• Grepalife Dollar Bond Fund Corp. (USD$)
• Grepalife Fixed Income Fund Corp.

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MUTUAL FUNDS
Bond Funds
 MAA
 MAA Privilege Dollar Fixed Income Fund, Inc. (USD$)
 MAA Privilege Euro Fixed Income Fund, Inc.
 Philam
 PAMI Global Bond Fund, Inc (USD$)
 Philam Bond Fund, Inc.
 Philam Dollar Bond Fund, Inc. (USD$)
 Philequity
 Philequity Dollar Income Fund Inc. (USD$)
 Philequity Peso Bond Fund, Inc.
 Prudentialife Fixed Income Fund Inc.
 Sun Life
 Sun Life Prosperity Bond Fund, Inc.
 Sun Life Dollar Abundance Fund, Inc. (USD$)
 Sun Life GS Fund, Inc.

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MUTUAL FUNDS
Money Market Funds
 ALFM Money Market Fund, Inc.
 First Metro Save and Learn Money
Market Fund, Inc.
 Philam Managed Income Fund, Inc.
 Sun Life Prosperity Money Market
Fund, Inc.

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HOW DOES IT WORK?
 You invest by buying shares or units (navps / navpu)
 Minimum Initial Investment P5,000.00 – P10,000
 Succeeding minimum investment P1k-P5k
• NAVPS / NAVPU – changes daily

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EXAMPLE
For example 1/4/2013
Equity Fund
P10,000 / P3.6598 (navps)
= 2,732 shares

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As of 2/26/2013
NAVPS is now P4.0375
2,732 shares x P4.0375 (NAVPS)
= P11,030.45
10.30% in 2 months

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SALES LOAD (CHARGES)
Most mutual funds automatically charge a fee of
2% - 3.5% upon placement.
For example – P10,000, charge is 2% = P200.
Total money invested is P9,800.00
If withdrawn within 1 year, some still charge an exit fee
of 1-2% of the total amount

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HOW ARE NAVPS/NAVPU COMPUTED

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FEES (UITF)
BDO BPI MBT UBP ODYSSEY
Trust Fee Trust Fee
Admin/Handling
Fee
Equity 1.00% 1.50% 2.00% 2.50% 2.00% - 2.50%
1.50% of
subscription
amount
Balanced 1.00% 1.50% 2.00%
2% on Gross Market Value of
Equity; 1.00% on Gross MV
of FI; 0.25% on total MV
1.50%
1.50% of
subscription
amount
Bond 0.50% to 1.00% 1.50% 1.00% to 1.50% 1.00% 1.00%
1.00% of
subscription
amount
Minimum
Holding
Period
30 days None 90 days 90 days
Early
Redemption
Charge
0.50% of original
participation
amount
50% of income
from redeemed
amount
0.25% of redeemed amount
or 500 whichever is higher

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FEES (MF)
Equity Funds
FEES FAMI
Philam
(PSGF)
Philequity Sun Life ATRKE ALFM
Entry Fee 2.00% 3.00% 3.50%
2% if Front End
2.24% 0.00%
0 if Back End
Exit Fee > 6 mos 1% > 6mos 2%
> 1 year = 2% 0 if Front End
5% 1% > 6 months1 year < 2 years = 1.50% 5%, 4%, 3%, 2%, 1%
> 2 years = 0 > 5 years = 0

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UNIQUE SALES CHARGE
ALFM (BPI) – No entry fee
Sun Life has 2 ways of charging. Either Front End (FE) or
Back End (BE) load.
FE – 2% entry fee. No holding period, no exit fee.
BE – No charges upon entry but with charges upon exit
depending on the years invested. Best for long term.
If withdrawn on
1st year - 5% 4th Year - 2%
2nd Year - 4% 5th Year – 1%
3rd Year - 3% 6th Years onwards - 0

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IN CASE OF DEATH OF INVESTOR
Documents needed to claim in case any one investor has died?
• The required documents include:
• Certified True Copy of the deceased’s Death Certificate
• The court order allowing the Will and distributing the estate of the
deceased to his heirs. If there is no Will: if applicable, a Deed of
Extrajudicial Settlement of Estate
• Affidavit of Publication of Notice to Creditors of deceased, if
applicable
• Marriage Contract, if claimant is the spouse
• Birth Certificates of children, if these are the claimants
• If Beneficiary is a minor, the court order appointing the guardian to
take the place of the deceased trustor or trustee

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TOP EQUITY FUNDS
Top Equity Funds as of August 16, 2013
Rank Mutual Fund YTD Gross Return
1 BDO Equity UITF 15.23%
2 BPI Phil Stock Index Fund (Equity) 14.21%
3 ATRKE Equity Opportunity Fund (Equity) 14.03%
4 Metro Equity Fund UITF 13.51%
5 Philequity PSE Index Fund Inc. (Equity) 12.56%
6 ATRKE Alpha Opportunity Fund, Inc. (Equity) 12.54%
7 Philequity Fund, Inc. (Equity) 11.70%

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TOP MUTUAL FUNDS YTD
Top 10 Mutual Funds as of August 16, 2013
Rank Mutual Fund YTD Gross Return
1 FAMI Bond Fund (Bond) 19.72%
2 Philequity Peso Bond Fund (Bond) 17.79%
3 Optima Balanced Fund (Balanced) 14.71%
4 BPI Phil Stock Index Fund (Equity) 14.21%
5 ATRKE Equity Opportunity Fund (Equity) 14.03%
6
ATRKE Philippine Balanced Fund, Inc.
(Balanced)
13.18%
7 Philequity PSE Index Fund Inc. (Equity) 12.56%
8 ATRKE Alpha Opportunity Fund, Inc. (Equity) 12.54%
9 Philequity Fund, Inc. (Equity) 11.70%
10 Philam Bond Fund, Inc. (Bond) 10.11%

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WHICH IS BETTER
MF / UITF
or
Direct Stocks Investment??

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Basic Steps to Financial Security

Pooled Funds - MF / UITF

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