Mutual fund assets grow to P86.4B as of April

The assets under management (AUMs) of the country’s mutual fund industry has reached P86.4 billion as of end-April from P75 billion at the start of the year.

The bond mutual funds (peso and US dollar) remained the biggest, amounting to a little over P63.16 billion, followed by the balanced funds at P12.37 billion, equity funds at approximately P10.35 billion and money market funds at over P603 million.

Based on data from the Investment Companies Association of the Philippines (ICAP), the size of the net assets proved that investors’ appetite remain strong.

The largest individual fund remains the ALFM Peso Bond Fund (formerly the Ayala Life Fixed Income Fund), with P35.59 billion, managed by the Bank of the Philippine Islands’ asset management group.

The next biggest bond fund is the Philam Bond Fund amounting to P8.23 billion, followed by the Philam Dollar Bond Fund at P6.4 billion. The fund manager of the two funds is Philam Asset Management Inc. (Pami).

Other top band funds are the Sun Life Prosperity Bond Fund with P4.97 billion and the ALFM Dollar Bond Fund worth P5.24 billion. Sun Life Asset Management Corp. (SLAMC) is the asset manager of the Sun Life Prosperity funds while the BPI group takes care of the ALFM funds.

Most peso-denominated bond funds experienced slight declines from previous levels as investors continue to migrate to the equity funds or foreign currency denominated funds.

The largest balanced mutual fund, the Sun Life Prosperity Balanced Fund is worth P5.8 billion while its dollar balanced fund reached P1.35 billion. The GSIS Kinabukasan fund stood at P2.4 billion while the Philam Fund amounted to P1.94 billion. Both funds are managed by Pami.

The largest equity or stock fund is the Philippine StockIndex Fund with assets reaching P2.82 billion while the P2.16-billion managed assets of the PhilEquity Fund is the second biggest.

The Philippine Stock Index Fund is managed by the BPI group, while the PhilEquity Fund is managed by  Philequity Management Inc.

Mutual funds are growing in popularity in terms of alternative investment instruments.  Mutual funds are extremely popular investment tools in Europe, North American and Asian countries.A mutual fund is an investment company, registered with the Securities and Exchange Commission (SEC), whose objective is to make money by investing and reinvesting in securities and other financial instruments. An investor (individual or institutional) can participate in the investment company or mutual fund by buying the shares of the fund, thus becoming shareholders.

The fund is managed by an asset management company (AMC) run by full-time investment professionals.

There are five basic types of mutual funds:  bond funds, equity or stock funds, index funds, money market funds, and balanced funds.