A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. It is essentially a diversified portfolio of financial instruments - these could be equities, debentures / bonds or money market instruments. The corpus of the fund is then deployed in investment alternatives that help to meet predefined investment objectives. The income earned through these investments and the capital appreciation realized are shared by its shareholders in proportion to the number of shares (NAVPS) owned by them. Thus, a Mutual Fund is a suitable investment for the common man as it offers an opportunity to invest in a diversified, professionally managed basket of securities at a relatively low cost. A mutual fund can make money in two ways: 1) the security can pay dividends and interest to the fund; or 2) A security can rise in value.
Net Asset Value is the market value of the assets of the scheme minus its liabilities. The per unit NAV is the net asset value of the scheme divided by the number of units outstanding on the Valuation Date.
The value or price at which investors could subscribe or redeem the shares of a mutual fund.
NAVPS is computed:
NAVPS = Total Value of Fund Assets - Total Liabilities
Number of shares Outstanding
The NAV is updated at the end of trading day. What this means is that your purchase will be based on the updated NAV at the end of the trading day, and published only on T+1. Because of this, you may not know the exact NAV at the time you subscribe or redeem your shares.
Mutual funds are a mix of bonds, stocks, and other financial instruments. When you buy or sell a mutual fund, you’re also buying and selling a combination of bonds, stocks, and other financial assets. Returns will depend on the condition of the markets represented by the mutual fund.
Mutual funds aim to reduce the volatility of returns by placing in different types of investment thus inherently balancing risk across various outlets. Investor of mutual funds, attain the benefit of diversification as mutual funds are invested in a wide range of securities.
Mutual funds are managed by professional fund managers who analyze the market which stocks and/or bonds to buy or sell in the portfolio of a fund on a daily basis. Your small investment is represented by the number of shares you hold in one of the many investors in the fund and the price for each share is called Net Asset Value Per Share (NAVPS).
Investors can sell their holdings in mutual fund investments anytime without worrying about finding a buyer at the right price.
There is no “Front – end” fee (fee that is being charged upon initial investment). Moreover,since mutual funds are a pool of money of many investors, the amount of investment made in securities is large and therefore can command a lower (fee) charge.
Prices of open ended mutual funds are declared daily. Regular updates on the value of your investment are available. The portfolio is also disclosed regularly with the fund manager's investment strategy and outlook.
Mutual funds are highly/well regulated by the Securities and Exchange Commission (SEC) and function under strict regulations designed to protect the interest of investors.
No. Mutual fund gains are exempted from taxes based on the Comprehensive Tax Reform Package. This was done to promote long-term savings in the country.
Funds which are invested in stocks listed in the Philippine Stock Exchange.
Funds composed of debt instruments issued by the Governemnt or Private Corporation.
Funds are allocated on both stocks and bonds.
Funds are invested in short-term time deposits, corporate bonds, treasury bills and government securities.
Minimum initial investment is at only P5,000.
Redemption price is the price received by the customer on selling units of an open-ended scheme to the fund. If the fund does not levy an exit load, the redemption price will be same as the NAV. Theredemption price will be lower than the NAV in case the fund levies an exit load.
Redemption must be settled to the respective clients account within T+7days. If you redeem within the holding period, you are subject for an early redemption fee this will be automatically deducted from your proceeds. Redemption fees are computed as follows:
Gross Proceeds = No. of Shares Redeemed x Navps
Net Proceeds = Gross Proceeds x (1 – Exit Fees)
Mutual fund charges a fee for portfolio management on an annual basis is calculated as a percentage of net assets under management.
*Note: Only Pending (status) Instructions can be Cancelled.
*Note: Only Pending (status) Instructions can be Modify.
The cut-off time in Subscription and Redemption orders is 11:00am. Any orders submitted 11:00am onwards shall be processed the next banking day.
Subscriptions or redemptions received on or before the cut-off period will be processed based on the NAVPS for that business day.
Orders placed within the cut-off period, confirmation of orders will be sent via email in the succeeding business day. Otherwise, orders submitted after the cut-off period will be processed in the next business day and confirmations from these will come the day after.