MANILA, Philippines - The Philippine National Bank (PNB) has introduced a trust product designed for the bullish equities market, which has continued to hit new highs in the past week.
The PNB Enhanced PSEi Reference Fund is the first and only peso-denominated model-driven fund in the equities market. It invests in a select basket of stocks, which are highly correlated to the Philippine Stock Exchange index (PSEi).
Using an enhanced index reference approach, the reference fund allows investors to ride the gains during a market bull run while providing them a safety net from losses during a bear market by shifting its portfolio to fixed income instruments. It is ideal for aggressive investors who understand the risks associated with equities investment.
“But it reduces the risk by staying out of the equities market and investing in the relative security of fixed income securities during a market downturn,” PNB said in a press statement. Minimum initial participation in the new fund is only P25,000.
Meanwhile, the PNB Mabuhay Prestige Fund is a peso-denominated balanced fund invested in a mixed portfolio of equities and fixed income instruments.
The equities portion of the portfolio is also model–driven. Listed companies with large market capitalization serves as its stock universe. These stocks are more liquid and generally stable.
The fixed income portion is invested in marketable instruments such as deposits, government securities and corporate bonds. The PNB Mabuhay Prestige Fund offers the best of both worlds: the high growth potential of the equities market, and the security and income-generating capability of fixed income instruments. Participation in the Fund is available for a minimum investment of P100,000.
“As one of the pioneers in the trust banking business, PNB continuously provide its retail, corporate and institutional clients with a wide array of trust banking product options anchored on sound investment strategies and professional expertise,” it said.
PNB’s Trust Banking Group is currently embarking on a major re-alignment of its products and services to cater to the changing needs of its customers. The two new trust funds usher the Group’s revitalized product lines.
Earlier, PNB Trust Banking Group head Rafael G. Ayuste said total assets under management (AUM) expanded by 28 percent in the first three months of 2010, as a direct result of an organizational restructuring.
“Based on its first quarter results, PNB Trust Banking is on track to achieve its targets in 2010,” Ayuste added.
PNB Trust offers UITFs designed especially for overseas Filipino workers (OFWs).
The peso and dollar Punla UITFs for OFWs, has very low initial participation to encourage OFWs to save a portion of their earnings for their future needs. The funds are placed in investment instruments that provide better returns than regular time deposits that have minimal marked to market risks.
It has products for investors with short investment horizons of less than one year and also for those with long-term horizon, and prefer to avail of tax-exempt benefits.
PNB has the Mabuhay Unit Investment Trust Funds (UITF), which are denominated in pesos and come in three variants.
The Mabuhay Prime invests in short-term investment instruments and is suited for conservative clients. The Mabuhay Plus is an intermediate bond fund for the moderate investor while Mabuhay Prestige, a balanced fund invested in both fixed income and equities, is designed for the moderately aggressive client.