Bank Equities

[eischied_21]

^ same sentiment here. Kahit gusto magsubscribe sa BDO Equity I can't kasi medyo hassle maginvest sa kanila.

[mxherr5]

@ beach

Good, I thought you were saying that just because
a fund has a lower NAV/price its automatically a better
choice than one with a higher NAV/price

@entwife, let me try to explain it further

Basically, the net asset per share(or unit) is just
the fund's net asset divided by the number of shares
or units. I'll refer to it as NAV as that is what most
people are used to.

I'll give you a semi realistic example and to make
it simplier I'll ignore the taxes and fees so that
means there's no liabilities.

Let's say there are two index funds called
ALFM PSIF and BPI Index Fund whose objective
is to invest in one stock called TEL.

ALFM PSIF has Php 10,000 to invest
BPI Index Fund has Php 0 to invest and is still trying to raise money


Date: Month 0

TEL has a price of Php 100.00

ALFM PSIF invested Php 10,000 and received 100 shares
of TEL

ALFM PSIF now has:
Asset: Php 10,000(100 TEL shares x Php 100)
NAVPS: Php 10,000/10,000 shares = 1.00

BPI Index Fund has nothing yet


Date: Month 1

TEL now has a price of Php 200.00

ALFM PSIF now has:

Asset: Php 20,000(100 TEL shares x Php 200)
NAVPS: Php 10,000/10,000 shares = 2.00

GOOD NEWS!
BPI Index Fund was able to raise Php 10,000
And invested it all in TEL.
It received 50 shares of TEL.


BPI Index Fund now has:
Asset: Php 10,000(50 TEL shares x Php 200)
NAVPS: Php 10,000/10,000 shares = 1.00

Date: Month 2

TEL now has a price of Php 400.
Wow, it doubles every month LOL

ALFM PSIF now has:
Asset: Php 40,000(100 TEL shares x Php 400)
NAVPS: Php 10,000/10,000 shares = 4.00

Whereas

BPI Index Fund now has:
Asset: Php 20,000(50 TEL shares x Php 400)
NAVPS: Php 10,000/10,000 shares = 2.00

And that's it for the mutual funds.
Now let's go check the investors

****************************************************

There are 2 investors named beachpatrol and entwife
and on Month 1, they were mulling which fund to invest in.

beachpatrol believes BPI Index Fund is better since
it has a smaller NAV and it just opened! Take advantage
of the low price right?

entwife on the other hand went with ALFM PSIF citing
its longer history(by a month LOL :p )

So on month 1,

beachpatrol has Php 1,000 to invest
and puts it all in BPI Index Fund
She receives 1,000 shares

beachpatrol Investment Account: 1,000 (1,000 shares x 1.00 NAV)

entwife invested Php 1,000 in ALFM PSIF
and receives 500 shares

WHOA!!! She has less shares than beachpatrol!
Is that bad or good?

entwife Investment Account: 1,000 (500 shares x 2.00 NAV)

After a month, which is month 2 haha

beachpatrol has
beachpatrol Investment Account: 2,000 (1,000 shares x 2.00 NAV)

while entwife has
entwife Investment Account: 2,000 (500 shares x 4.00 NAV)

GASP!!! WHAT??!! How could that be?
They came out even

Well, like I said the current NAV doesn't matter.
What matters is how fast the NAV moves(hopefully upwards)
and what influences that? Why its the fund's underlying
investment

@ entwife, I hope that made it clearer for you

[bratinella08]

finally, i opened my bdo equity yesterday, 425 level. as usual, mataray uli staff nila, pero kiber na. So sad, bumaba bpi index fund, but its okay, long term investment ko naman sya... next mbt equity... 

[ampere]

^ gusto ko i-try yun. kaya lang i will need to enrol again for UITF. kasi sa MF lang ako ng BPI enrolled. di ko pa napagsabay before. sa mga mag-oopen pa lang ng investment account with BPI, isabay nyo na application para isang submission na lang at nang wag kayo matulad sa akin 

sis ilang days bago nag-appear sa BPI Port mo yung MF accnt investment mo? kasi nagsubscribed ako last Wednesday till now wala pa din sya sa port ko yung UITF nag-appear agad after 24 hours after i subscribed.


sayang yung BDO sa June 10 pa mag-umpisa yung EIP ko sana pala mas inagahan ko na lang yung date

[leelou]

^sis mga 1-2 days lang yata. nabigyan ka na ba ng MF investment account no.?

[ampere]

^meron na sis kinuha ko kahapon yung copy ko. baket kaya till now wala pa din    pwede bang ako na lang mag-enroll if ever di pa din sya mag-appear after how many days, no need na ba to activate in their ATM machine if i-enroll ko kasi balik na ako SG bukas.

[mxherr5]

^
You only need to activate EOL via ATM initially naman sis.

I'm sure may BPI savings account ka o kung wala, then
pina open ka nila para may settlement account ka so pwede
yun gamitin mo pang enroll muna.

Pero kung may EOL account ka na, no need to activate
any future additional accounts via ATM.

[leelou]

@ampere sis i remember kasi ni-text sa akin ng friend ko yung investment account number ko pero nakita ko na sya activated online.

[ampere]

^thank you for your replies, will just enroll it myself if ever  

[entwife]

mxherr5, thank you.

Now I understand how it works and that lower Nav does not exactly mean a better option.

[pret_ty68]

Na ka decide na ako mag invest sa bdo equity fund. Tanong ko lang regarding sa holding period. Nabasa ko kasi 30 days ang holding period. After 30 days ba kailangan mo magpunta sa bank para mag renew?  or ok lang na  hayaan mo lang ang investment kahit abutin nang mga ilang taon?

Pag mag wi withdraw ka na pala nang investment pwede bang partial? or kailangan i withdraw mo yung buo for example 100 ang shares mo pwede ba na yung equivalent lang nang 40 shares ang kunin mo and itira yung equivalent nang sa 60 shares?

[mxherr5]

@entwife, no problem

@pretty, no, you don't have the renew.
The holding period pertains to how long
you have to hold it in(LOL) before you can
redeem your investment without charges.

So, in BDO's case. if you redeem within
30 days then you'll pay the appropriate charges,
if its after 30 days then its free of charge.

Redemption in BDO's funds is on a per COP(certificate of
participation). Technically, if you have a COP worth 30k,
you can redeem all of the 30k then just put the 20k back in.
Somewhat simulating a partial withdrawal. But no, officially
you cannot do partial withdrawals.

[pret_ty68]

^
Thanks a lot sis mxherr5 Ok lang pala kahit after mga after a year na ako uli pumunta nang bank in case gusto ko nang i withdraw.

[ann08]

I have the perception na the lower NAV the better, pero it should not be the case pala. Mas
better understanding na after reading mxherr explanation. Thanks a lot.

Question, when is the best time to
top up sa investment na mutual fund and UITF? May best time ba or dapat peso cost averaging din?
May timing din ba dapat? Thanks

[soumy01]

tama, wala sa nav yun nasa performance yun ng fund.
para sa akin maganda yung peso cost averaging , hindi naman natin alam kung kelan biglang baba yang nav na yan. katulad ngayun nung mga nakaraan buwan lang  flying high ang psei tapos biglang ngayun nagpupulahan. tapos kung may extra money talaga na naitatabi pa maganda kung may  nakareserve pang bili kung biglang bumaba ang nav.

pero syempre iba na usapan kapag trader na sa stock ang kakausapin mo.

sana nga yung bdo gawin nilang mas madali katulad sa bpi. ang tendency tuloy namin sa bpi maglagay kasi masmadali mag transfer sa bpi. kahit na mas maganda performance ng bdo. pero naglalagay din kami sa bdo hindi nga lang consistent.

[mxherr5]

@ann08, common financial wisdom states that market
timing mutual funds would result in you getting lower returns
than the fund you are in.

Dilbar's studies show that people tend to redeem out of
bad fund performers and will reinvest in the hot performing
fund.

Cost averaging is the way to go.

If you do want to time the market in a somewhat scientific way.
You can look up value averaging. Its an improved version of cost averaging.
I tried it but didn't have the patience to follow thru.

[fortunecat8]

ampera, sis why di ka pinayagan? 

I opened a BDO Equity and sa BPI, equity kasi 'magalaw' ngayon eh.

[fortunecat8]

Yung  FAMI Equity Fund ko naman lagi ako nakasubaybay sa pag up & down. lol

[pret_ty68]

Halimbawa po i redeem ko yung bdo equity fund ko tomorrow june 14 before 12 am alin bang NAVPU ang gagamitin yung NAVPU nang june 13 o yung navpu nang june 14?

[mxherr5]

@pret,

I'm assuming the 12am was a typo and you meant 12pm?
12am = 12 midnight, 12pm = 12 noon

You'll get the Jun 14 NAV.
Knowing the NAV you'd get when you redeem would lend
to market timing so when you invest or redeem, you would
always either get the NAV on that day if its before the cutoff
or the NAV the next day, if its after the cutoff.
But bottomline is, you won't know the NAV until after the fact.