What is your investment style?

Before you start investing, it is best to first gauge the investment style befitting you and your financial goals. That way, you can approach your investing in a more disciplined and organized manner.

Your investment style will typically be determined by the following factors:

  • Your temperament (i.e. your patience, the amount of effort you are willing to put in, the amount of risk you are willing to stomach)
  • Your profile (i.e. your age, income, wealth)
  • Your financial objectives

Discerning and articulating these very personal factors is a fantastic first step for any investor. What answers you reach from your discernment will guide you in finding the best investment style for you.

We broke down the most commonly practicable ones here for your consideration.

Active vs. Passive

An active investor picks his own stocks. A passive investor typically buys shares in an index fund such as BPI’s Philippine Stock Index Fund or the ATRAM Philippine Equity Smart Index Fund, effectively outsourcing the whole stock selection process. The active investor believes in his own ability to pick stocks to outperform the market. The passive investor believes that the most efficient way of producing long-term returns is by investing in the market as a whole.

The active investor bypasses the investment management fees charged by investment funds and stands the chance of finding great investment opportunities ignored by the market. The passive investor bypasses all the heavy research conducted by active investors which is not necessarily always fruitful.

Growth vs. Value

In terms of stocks, a value investor looks for companies selling at below their intrinsic value, preferably with a significant margin-of-safety. A growth investor looks for companies offering the possibility of above average growth, regardless of price in relation to intrinsic value.

Some famous value investors include Warren Buffett, Benjamin Graham, and to an extent Peter Lynch (although his style often also verges on the growth investing side). Some famous growth investors include Thomas Rowe Price, Jr. and Philip Fisher.

Investors could also consider investing in companies promising “growth at a reasonable price”. This approach blends elements of value investing and growth investing. In effect, the investor hopes to find stocks that may deliver above average growth but are not too expensive in relation to their intrinsic value.

Market Report: January 28, 2022

Top Stories

  • Philippine Gross Domestic Product (GDP) expanded by 5.6% in 2021, beating most estimates.
  • MREIT, Inc. (MREIT) aims to acquire ₱20-Billion worth of office properties in 2022.
  • Citicore Energy REIT Corporation (CREIT) cuts offer price by 19% to ₱2.55/share.

Market Indices

IndexLast CloseYTD1W4WP/E
PSEi7,251.971.82%(0.57%)1.82%22.41
All Shares3,856.080.99%(0.34%)0.99%17.26
Financials1,694.895.52%2.17%5.52%11.28
Industrial10,616.982.05%1.93%2.05%20.63
Holding Firms7,063.073.76%(1.77%)3.76%19.07
Property3,126.00(2.91%)(1.65%)(2.91%)25.39
Services1,952.96(1.68%)(1.02%)(1.68%)44.36
Mining & Oil10,189.026.12%(3.25%)6.12%10.82

Weekly Top Price Gainers

RankStockLast CloseChange (%)
1KPHB₱8.0029.03%
2ATN₱0.7728.33%
3SPNEC₱2.1725.43%
4MJIC₱1.3616.24%
5EMP₱22.3015.07%
6FCG₱0.8510.39%
7OPM₱0.0138.33%
8CNPF₱28.008.11%
8PHR₱0.808.11%
10WLCON₱29.757.40%

Weekly Top Price Losers

RankStockLast CloseChange (%)
1X₱0.4318.87%
2ABS₱11.5018.21%
3MACAY₱5.5117.14%
4HTI₱1.2814.67%
5MM₱1.8614.29%
6GREEN₱1.9411.82%
7FERRO₱2.9211.52%
7LPZ₱2.9211.52%
8RLT₱0.1911.21%
10ROX₱1.0010.71%

Upcoming Dividends

StockType of SecurityType of DividendDividend RateEx-Dividend DatePayment Date
Megawide Construction CorporationMWP2ACashPhP1.1875January 31, 2022February 28, 2022
Megawide Construction CorporationMWP2BCashPhP1.4375January 31, 2022February 28, 2022
Union Bank of the PhilippinesCommonCashPhP2.80February 9, 2022March 2, 2022
Petron CorporationPRF3ACashPhP17.17825February 28, 2022March 25, 2022
Petron CorporationPRF3BCashPhP17.84575February 28, 2022March 25, 2022

A Quick Guide to Basic Stock Terms

After Hours is an editorial column more loosely covering our thoughts on a variety of topics in finance.

What is a stock?

A stock is a security (a tradable financial asset) representing a share of ownership in a business. A stock is sometimes also called a “share” or “equity”.

A person who buys shares of stock in a business is a “stockholder” of the business. Through his equity stake, the stockholder gains a say in a business’ operations and claims on its residual cashflows (essentially whatever money is left after expenses and debts have been paid).

Businesses need money to operate. Businesses need money to grow. Although, in theory, businesses can choose to get this money from their own operations, they can also choose to raise money through debt financing (by taking out loans or issuing bonds) or equity financing (by offering shares of stock).

What is debt financing?

Debt financing is when a business borrows money from banks (through a loan) or investors (through a bond issuance). The business promises to pay back the money he has borrowed plus interest. Sometimes, the business is also asked to put up some of its own assets as collateral in case it defaults. If a business is having trouble paying down a loan, lenders could potentially run after its assets to cover what they lent out. However, when a business takes out a loan, it sacrifices nothing in terms of ownership and it is only expected to pay back the principal on the loan plus interest.

What is equity financing?

Equity financing is when a business sells shares of its own stock to investors. A business is then able to raise money from the new capital put up by new investors. A business is not liable to pay back equity investors in the event of a collapse. However, what equity investors sacrifice in terms of safety of capital can be richly rewarded when a business does well. This is because equity investors gain a claim on a business’ residual cashflows in exchange for the capital they put up.

In raising money from equity investors, businesses can offer common stocks or preferred stocks.

What is a common stock?

A common stock is a stock in its most traditional sense. An investor who buys common stock gains ownership in a company and the possibility of dividends (when a business distributes a part of its profits to equity investors). In effect, common stocks allow for full participation in a business’ success but also full participation in the event it fails.

What is a preferred stock?

A preferred stock is a sort of cross between a common stock and a bond. An investor who buys preferred stock is paid a more secured and predictable dividend than one who buys common stock (assuming of course that the company has enough cash to do so). This is because a preferred stock investor is paid his cashflows before the common stock investor. (Although the company must, of course, pay lenders before preferred stock investors.) However, preferred stock investors do not gain any real control of a business and they usually don’t earn anything beyond the dividends promised to them. A business is also not necessarily required to redeem (buy back) its preferred stocks to cover the capital put up by preferred stock investors.

How do I use a stock screen?

After Hours is an editorial column more loosely covering our opinions on a variety of topics in finance.

The ugly truth is that it is impossible to go through the financial statements of all available companies in the world’s stock exchanges. There is just not enough time. And although the potential for reward could be higher if you sift through each and every one, that would still mean sifting through a lot of dirt.

This is where stock screening comes in. It’s just easier and more straightforward. You pick a few criteria, making sure none are too restrictive, and then you exclude any stocks that do not meet this criteria. It is neither the most graceful practice nor the most thorough, but it quickly cuts down your universe of stocks to a smaller, more manageable group.

We have adapted some criteria borrowed from Chapter 14 (“Stock Selection for the Defensive Investor”) of Benjamin Graham’s The Intelligent Investor to serve as a starting point for any who wish to employ stock screening into their investment research process.

  1. Debt-to-Equity Ratio must be less than 1.0.
  2. Total Debt-to-Net Working Capital Ratio must be less than 1.0.
  3. Current Ratio must be more than 2.0.
  4. Company must have consistently paid out annual dividends over the last ten (10) years.
  5. Net Income must have grown by at least 33% compared to ten (10) years prior.
  6. Price-to-Earnings Ratio must be less than 15.0.
  7. Price-to-Book Ratio must be less than 1.5.

GInvest Fund Guide: ATRAM Philippine Equity Smart Index Fund

GCash’s GInvest allows users to invest in a wide selection of stocks and bonds via investment funds for as low as PhP50.00. In this article, we break down all you need to know before investing in the ATRAM Philippine Equity Smart Index Fund (ATRAM PESIF).

For a step-by-step run-through detailing the process of buying shares of investment funds through GInvest, see our guide: How to Invest in Mutual Funds with GCash.

For all you need to know about mutual funds, see our article: What is a Mutual Fund?

Fund Description

Like BPI’s Philippine Stock Index Fund (PSIF), the ATRAM PESIF is an index fund which mirrors the composition of the Philippine Stock Exchange Index (PSEi).

Based on the ATRAM PESIF’s Key Information and Investment Disclosure Statement (KIIDS), the minimum initial investment required is PhP50.00 and PhP50.00 for each succeeding addition.

Management Fees

Summarized below are the fees charged by ATRAM PESIF amounting to 1.64% charged as a percentage of the average daily net asset value (NAV) of the fund for each quarter.

Trustee Fees1.50%
Custodianship Fees0.03%
External Auditor Fees0.01%
Other Fees (Transaction Fees)0.10%

Redemption

The ATRAM PESIF has no minimum holding period and no early redemption charges.

Investment Considerations

Merits

  • The ATRAM PESIF lets you enjoy the returns of the Philippines’ most dominant companies.

Risks

  • BPI’s PSIF may be a better option as it charges a 1.00% compared to ATRAM PESIF’s 1.64%.
  • As with any investment, returns are not guaranteed and research is very much necessary.

GInvest Fund Guide: ATRAM Peso Money Market Fund

GCash’s GInvest allows users to invest in a wide selection of stocks and bonds via investment funds for as low as PhP50.00. In this article, we break down all you need to know before investing in the ATRAM Peso Money Market Fund (ATRAM PMMF).

For a step-by-step run-through detailing the process of buying shares of investment funds through GInvest, see our guide: How to Invest in Mutual Funds with GCash.

For all you need to know about mutual funds, see our article: What is a Mutual Fund?

Fund Description

The ATRAM PMMF mainly invests in a portfolio of highly liquid fixed-income instruments with average maturities of one (1) year or less. The fund aims to produce higher returns than the regular bank deposit but will likely produce lower returns than a regular bond fund such as the ATRAM Total Return Peso Bond Fund (ATRAM TRPBF).

Based on the ATRAM PMMF Key Information and Investment Disclosure Statement (KIIDS), the minimum initial investment required is PhP50.00 and PhP50.00 for each succeeding addition.

Management Fees

As with any feeder fund, investors must consider the fees of both the feeder fund and the target fund it invests in.

Summarized below are the fees charged by ATRAM PMMF amounting to 0.71% charged as a percentage of the average daily net asset value (NAV) of the fund for each quarter.

Trustee Fee0.70%
External Auditor Fees0.01%

Redemption

The ATRAM PMMF has no minimum holding period and no early redemption charges.

Investment Considerations

Merits

  • The fund lets you invest in a basket of liquid fixed income securities with an extra focus on capital preservation as opposed to sharp returns.

Risks

  • Investors may find a bond fund such as the ATRAM TRPBF more interesting if they can harbor the marginal increase in risk of the bond fund compared to a money market fund.
  • As with any investment, returns are not guaranteed and research is very much necessary.

GInvest Fund Guide: ATRAM Global Consumer Trends Feeder Fund

GCash’s GInvest allows users to invest in a wide selection of stocks and bonds via investment funds for as low as PhP50.00. In this article, we break down all you need to know before investing in the ATRAM Global Consumer Trends Feeder Fund (ATRAM GCTFF).

For a step-by-step run-through detailing the process of buying shares of investment funds through GInvest, see our guide: How to Invest in Mutual Funds with GCash.

For all you need to know about mutual funds, see our article: What is a Mutual Fund?

Fund Description

Like the ALFM Global Multi-Asset Income Fund (ALFM GMIF), the ATRAM GCTFF is a feeder fund which is a fund that invests its capital in a larger investment scheme known as a “target fund”. The ATRAM GCTFF invests in a target fund that maintains a portfolio of global stocks predominantly engaged in the design, production, or distribution of consumer products and services. The target fund of ATRAM GCTFF is the Invesco Global Consumer Trends Fund (IGCTF).

Based on the ATRAM GCTFF Key Information and Investment Disclosure Statement (KIIDS), the minimum initial investment required is PhP1,000.00 and PhP500.00 for each succeeding addition.

Management Fees

As with any feeder fund, investors must consider the fees of both the feeder fund and the target fund it invests in.

Summarized below are the fees charged by ATRAM GCTFF amounting to 1.17% charged as a percentage of the average daily net asset value (NAV) of the fund for each month..

Trustee Fee1.15%
Other Fees (Transaction Fees)0.02%

On top of this, investors must also consider the annual management fee of 1.50% charged by IGCTF, notwithstanding an entry charge of up to 5.00% depending on ATRAM GCTFF’s agreement with IGCTF.

Redemption

The ATRAM GCTFF has no minimum holding period and no early redemption charges.

Investment Considerations

Merits

  • The fund is a fast and convenient way of investing in a basket of GLOBAL companies.

Risks

  • Investors technically shoulder two (2) fees: the target fund’s (IGCTF) and the feeder fund’s (ATRAM GCTFF).
  • As with any investment, returns are not guaranteed and research is very much necessary.

GInvest Fund Guide: ATRAM Total Return Peso Bond Fund

GCash’s GInvest allows users to invest in a wide selection of stocks and bonds via investment funds for as low as PhP50.00. In this article, we break down all you need to know before investing in the ATRAM Total Return Peso Bond Fund (ATRAM TRPBF).

For a step-by-step run-through detailing the process of buying shares of investment funds through GInvest, see our guide: How to Invest in Mutual Funds with GCash.

For all you need to know about mutual funds, see our guide: What is a Mutual Fund?

Fund Description

The ATRAM TRPBF is a long-term bond fund which mainly invests in a selection of Philippine government bonds and corporate bonds.

Through bonds, investors can lend money to the government or to companies in exchange for repayment of the principal plus interest by the borrower. Bonds are thus also known as “fixed income” securities as the repayments are usually done in the form of coupons paid out on a regular basis.

The ATRAM TRPBF requires a minimum subscription amount of PhP50.00 and a further PhP50.00 minimum amount for succeeding subscriptions.

Management Fees

The ATRAM TRPBF is an actively managed bond fund. The fund’s fees are broken down below. The fees are charged as a percentage of the average daily net asset value (NAV) of the fund for each quarter.

Trustee Fees1.14%
Custodianship Fees0.02%
External Auditor Fees0.01%
Other Fees (Transaction Fees)0.01%

Redemption

The ATRAM TRPBF has no minimum holding period and no early redemption charge.

Investment Considerations

Merits

  • The fund provides a convenient way of investing in a basket of bonds from the Philippine government as well as from companies.

Risks

  • Although potentially more “stable” than stocks in terms of price fluctuations and cash flows, bonds also usually have lower potential returns than stocks.
  • Bonds may also face the threat of default if the borrower proves unable to repay his debt.
  • As with any investment, returns are not guaranteed and research is very much necessary.

GInvest Fund Guide: ATRAM Global Technology Feeder Fund

Through GCash’s GInvest, users can now invest in a basket of global technology stocks via the ATRAM Global Technology Feeder Fund (ATRAM GTFF) for as little as PhP1,000.00.

For a step-by-step run-through detailing the process of buying shares of investment funds through GInvest, see our guide: How to Invest in Mutual Funds with GCash.

For all you need to know about mutual funds, see our guide: What is a Mutual Fund?

Fund Description

Similar to the ALFM Global Multi-Asset Income Fund (ALFM GMIF), the ATRAM GTFF is also a feeder fund. Its target fund, which is the fund it invests its capital in, is the Fidelity Funds – Global Technology Fund (FF-GTF). As such, the ATRAM GTFF effectively mirrors the performance of the FF-GTF.

The ATRAM GTFF provides investors with the opportunity to invest in a basket of technology stocks from around the world. Investors can now enjoy the returns for stocks of top tech companies like Facebook, Apple, and Google. Based on its October 29, 2021 Key Information and Investment Disclosure Statement (KIIDS), 99.47% of the fund’s capital is invested in the FF-GTF.

Based on the fund’s prospectus, the minimum subscription amount is PhP1,000.00.

Management Fees

The ATRAM GTFF charges a 1.11% trustee fee. This is not too far from the fees charged by BPI’s Philippine Stock Index Fund. However, investors should take into account the fact that the ATRAM GTFF is a feeder fund which means that the fund also absorbs the fees of the target fund.

Summarized below are the fees charged by ATRAM GTFF amounting to 1.13% of the total fund. The fees are charged as a percentage of the average daily net asset value (NAV) of the fund for each month.

See ATRAM GTFF’s website page for more information.

Trustee Fee1.11%
External Auditor Fees0.01%
Other Fees0.01%
Total1.13%

As per FF-GTF’s Key Investor Information factsheet, the fund only charges 1.04% for “ongoing charges”.

Investment Considerations

Merits

  • The fund lets you invest in a basket of top global tech stocks like Facebook, Apple, and Google.
  • The fund has lower costs compared to the ALFM GMIF.

Risks

  • Investors still technically shoulder two (2) fees: one for the ATRAM GTFF and one for the FF-GTF.
  • As with any investment, returns are not guaranteed. Research is still necessary.
  • Tech is a fast-moving industry so the investor must be aware of the changes that may happen to the companies the fund invests in.

GInvest Fund Guide: ALFM Global Multi-Asset Income Fund

GCash’s GInvest allows users to invest in a wide selection of stocks and bonds via investment funds for as low as PhP50.00. In this article, we break down one fund which more recently spiked in popularity after some serious marketing efforts from several brokers: the ALFM Global Multi-Asset Income Fund (ALFM GMIF).

For a step-by-step run-through detailing the process of buying shares of investment funds through GInvest, see our guide: How to Invest in Mutual Funds with GCash.

For all you need to know about mutual funds, see our guide: What is a Mutual Fund?

Fund Description

The ALFM GMIF is a feeder fund relying on the active management of its appointed target fund: the BlackRock Global Multi-Asset Income Fund (BGMIF). In effect, the ALFM GMIF invests the money you place under its care into BGMIF and thus “feeds” off of BGMIF’s performance.

Based on ALFM GMIF’s prospectus, the minimum subscription amount is USD100.00 or its Peso equivalent and a further USD20.00 or its Peso equivalent for succeeding additional subscriptions. However, investing in the ALFM GMIF through GInvest allows investors to buy shares in the fund for as little as PhP1,000.00.

It should be noted that the ALFM GMIF also regularly distributes a dividend to investors unlike BPI’s Philippine Stock Index Fund or most other index funds today for that matter. As per ALFM GMIF’s prospectus, the dividends can come in the form of cash or additional shares on a monthly basis or whenever practicable.

Management Fees

The tricky thing with feeder funds is that their fees can look misleadingly low given that they are passively managed like index funds. However, since they usually feed off of the performance of an actively managed fund which charges an appropriate active management fee, the investor actually has to pay for the fees charged by the feeder fund and the fees charged by the actively managed fund.

Summarized below are the fees charged by ALFM GMIF amounting to 1.00% of the total fund per annum.

Management Fee0.475% p.a.
Distribution Fee0.475% p.a.
Transfer Agent Fee0.050% p.a.
Total1.00% p.a.

However, the returns after fees received by ALFM GMIF investors come only after the fees charged by BGMIF which are further summarized below.

Management Fee0.600% p.a.
Administration Fee0.250% p.a.
Custodian Fee0.0024% p.a.

Redemption

Investment funds usually charge a penalty for early redemption of shares. This is to prevent investors from withdrawing their funds all too quickly and harming the fund’s liquidity. ALFM GMIF charges a 1.00% early redemption fee if units are redeemed before the minimum holding period of 180 days.

Holding PeriodEarly Redemption Fee
Less than 180 days1.00%
More than 180 daysNone

Investment Considerations

Merits

  • The fund is a fast and convenient way of investing in a basket of GLOBAL companies.
  • Dividends declared by the fund provide regular cashflow.

Risks

  • Investors technically shoulder two (2) fees: the target fund’s (BGMIF) and the feeder fund’s (ALFM GMIF).
  • Investors may be better off just investing in an index fund like the PSIF.
  • As with any investment, returns are not guaranteed and research is very much necessary.