I Invested in Banco De Oro’s Easy Investment Plan (EIP)

Posted by Fitz Villafuerte under In Focus, Investing on September 10, 2011

I’ve been assessing my investments recently and saw that some low-risk investments which I placed several years ago have already grown significantly over the past few years.

Consequently, I thought that perhaps, it’s time to rebalance my portfolio and diversify more.

Incidentally, I’ve been studying the performance of BDO’s Unit Investment Trust Funds for several weeks now and personally, I think that some of their products are a good fit for my investment objectives.

And that is why last week, I went to the BDO branch near our home and opened an Investment Account with them.

BDO UITF I Invested in Banco De Oros Easy Investment Plan (EIP)

BDO was one of the sponsors of the Steps To Financial Peace Seminar I attended last month and it was there that I learned about Banco De Oro’s Easy Investment Plan or EIP.

The product works much like Citiseconline’s EIP for the stock market where you invest a fixed amount at regular periods over a good length of time.

Everything works automatically, because upon enrollment, BDO will just debit your decided amount from your BDO deposit account continuously until you give a stop order.

This allows you to conveniently practice Cost Averaging in your investment. It’s also affordable because the minimum investment is only P1,000 per month.

BDO EIP I Invested in Banco De Oros Easy Investment Plan (EIP)

For the BDO EIP, you have three products where you can invest: the Peso Fixed Income Fund (low to moderate risk), the Peso Balanced Fund (moderate to high risk) and the Peso Equity Fund (high risk).

Interestingly, almost exactly a year ago, I wrote a post analyzing BDO’s Peso Balanced Fund and I said that if the NAV goes above 2,627.61, then it’s most likely to go up more. A year after, it’s now at 2,799.13 (as of Sept. 9, 2011).

This means if I invested P10,000 last year when the NAV reached 2,627.61, then my money would have been worth around P10,652.76 today. No savings account, nor time deposit interest, can earn you that much from just P10,000 – that’s around 6.52% increase in your money.

While it’s important to note that historical performance is not a guarantee of future fund performance, the risk becomes manageable if you have a long investment horizon.

Since I could afford at least two years without touching this new investment, I decided to invest in the Peso Balanced Fund under BDO’s EIP program with a P5,000 per month investment for 24 months. Now I’m excited to see what would happen with my money after 2 years. icon biggrin I Invested in Banco De Oros Easy Investment Plan (EIP)

If you do have some savings you can afford to invest for at least a year or two, then maybe you can join me in this investment?

But if you are you still in the process of learning (and saving), then it’s really not a problem. Investing in knowledge does come first and it’s actually more important.

If so, then perhaps maybe you’d like to read this article next: Mutual Funds and Unit Investment Trust Funds, What’s the Difference?

I guess that’s it for now. Please don’t forget to subscribe to Ready To Be Rich to receive more investing information like this in the future.

Update:
Here’s a follow-up post on this: An Update on My BDO EIP Peso Balanced Fund Investment

Disclaimer: The information above should not be taken as financial advise from an expert. This article is merely for educational purposes. Please consult a wealth manager or a certified financial planner before making any major investment decision.


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89 Responses to “I Invested in Banco De Oro’s Easy Investment Plan (EIP)”


  1. Manix and jumel says:

    Fitz,

    Been a reader of your blog for quite sometime now and I am convinced that we should also go for bdo uitf. We would like to know the exact investment fund that you’ve placed your money. We will do the same? Did you go for the bdo peso balanced fund? Pls let me know.

    Thank you,
    Manix and Jumel

  2. Ram says:

    Thanks for this article fitz. I also invested in BDO EIP since it’s very easy on the budget.

  3. Erwin says:

    Hi Fitz –

    Thanks for sharing. If you can still remember, I won a ticket for this seminar. Unfortunately, my wife couldn’t make it.

    Anyway, is there a way for me to invest on this even if I’m overseas?

    I can’t seem to find the answer to this from the BDO site.

    Thanks!

  4. Fitz says:

    @Manix and Jumel – yes, I invested in the Peso Balanced Fund, my budget is P5,000 every month for two years.

    @Ram – care to share which fund you invested on? :D

    @Erwin – this is a fairly new product by BDO, I’ll ask the wealth manager of my branch regarding OFW investments and I’ll let you know if I have some info :-)

  5. Mark says:

    Hi Fitz,

    I’ve been reading your posts everyday and I learned something new everyday. Thanks for sharing your thoughts.

  6. dada says:

    Hi Fritz,

    I myself invested in the BDO UITF just last month. I’m so excited with it that i visit BDO’s website daily to check on the NAVPU. I plan on holding on to my investment for at least three years so I invested in the Equity Fund.

    I had a similar earlier investment – about 5years ago – with BDO, but I needed the money within a year of investing so it didn’t grow much, however, I didn’t lose money, either.

    I think UTIFs are good investments.

  7. Carl says:

    Hi Fitz and Erwin,
    I have a investment with BDO’s EIP even I am living and working here in Dubai.

    Download and Fill up the below forms and send it to your BDO branch via courier. You could email investments@bdo.com.ph for more clarification, they usually reply to your queries in 1-2 days.
    http://trust.bdo.com.ph/trustwebsite/personal-page.asp?pid=812
    Easy Investment Plan Form
    Client Investment Suitability
    Investor Profile Questionaire
    Risk Disclosure Statement

  8. emmie says:

    hiFitz,

    Almost a year when i read your article about mutual fund and Uitf in bpi.i invested in mutual fund min:50k last dec.23 low risks investment only. my money now increase to 51,250.thanks for the article.i learned a lot.

    next time, i try to invest UITF high risk investment either BPI or BDO.

  9. Sam says:

    You might also try Union bank’s UITF. Their last year’s YTD was 109%…yep…thats double your money in a year hahahah. see http://www.pinoymoneytalk.com/philippine-uitf-2010-returns/

    Regards,
    Sam

  10. Jp says:

    I really love reading your posts :) Been studying BDO’s offers as well the past couple of weeks. I’ll give it a shot, risk is something one should take if they want to learn/earn.

  11. dada says:

    Hi Fritz, do you think the NAVPU will have a steady decline in the coming days/weeks/months like in 2008 when the market crashed?

  12. Lianne says:

    Hi kuya Fitz,
    Wow. Awesome. I would like to invest in the EIP as well. Balanced Fund, too, I think, for my brother’s college fund. I think I can hold it for 4 years. Do you need to give an initial investment of 10,000 and then give additional for as low as 1,000 per month, or can you just enroll and give 1,000 instead of giving an initial of 10,000? Thank you so much!

  13. Fitz says:

    Hi Lianne, you can start with just 1,000 – but you will get your certificate and can redeem your fund 30 days after it reaches 10,000. Which means if you start with 1,000 a month – you will be able to sell your units only after 11 months.

  14. Alex says:

    I am here in Bangkok, and applied to BDO’s EIP by mailing the forms needed to my branch of BDO. All ofw can do this, if they have a Savings account in any of the BDO branches. All I did was called the Marketing officer of my branch and follow his instructions. You can find BDO branches telephone numbers on their website.

  15. asia says:

    hello..can i ask…how will i know id my money is makinga profit and how will i be able to get my profit…

  16. jm says:

    Hi Fitz, this is the first time that I will post in your blog. I must admit that you have awaken some sense in me that Im wasting some of my time not saving and investing. Now Im taking my time to invest in myself first , learning about investing, reading all I could find about financial management..Thank you for helping me get started on my financial literacy.
    I have a question about UITF, I try to read all I could find about the subject. Is it indeed that this fund have like a 20% Final Withholding Tax ? And also in one of my readings, its says that the bank will also invest the money in some investment that will yield a highter interest rate. Do you think it would be wise, if I bypass the bank and invest in mutual funds directly instead ?

    Your advice and the readers advice will be highly appreciated..

    Thank you.

  17. Fitz says:

    Hi JM, as far as I know, the 20% witholding tax is applied to the net earnings and not on the total investment – so you’ll still end with 80% of your net earnings.

    And yes, you can surely “bypass” the bank, invest the money yourself and create your own investment portfolio.

    If you have the time and investment knowledge, this is a possible option. But if you just like to just “sit back” and let other qualified investors do the investing decisions and monitoring for you, then getting a UITF or investing with a mutual fund company is a sound choice.

  18. jm says:

    Thanks Fitz for the sound advice., Another Question, I read somewhere here in your blog, that its okay to invest your emergency fund ? I review some of the details you shared in other entry about what you called the ” age formula ” Im 32 now and single and still dont have an investment . Im still trying to increase my emergency fund to 6 months worth of my salary (P120,000). Now if it happens, would it be wise to invest that emergency fund ? Or just continously increase it and save another fund for investment so that the emergency fund will remain intact ?

    Thank you again Fitz.,

  19. Fitz says:

    Hi JM. My personal opinion, keep 3 months of your EF in a savings account. Then invest the rest in a 90-day time deposit, or other special high-interest deposit product.

    This way, you have 3 months ready cash when you need it. And the rest, in a near-cash, zero-risk investment that earns a little more than a regular savings account.

    When you’ve accomplished this. The next step is to save money for medium to high risk investments which earns much higher over time such as mutual funds, UITFs, stocks and others.

  20. jm says:

    Thank you so much Fitz for sound advice. I will do that and continuosly educate myself about financial literacy.

  21. Franz Steven says:

    Hi Fitz,

    I too am a subscriber to BDO’s Easy Investment Program (Peso Balanced Fund), and so far I’m very impressed, I mean with the less knowledge I have about investments and everything in between. I’m subscribed at 1000 per month since I’m a new employee (being less than a year in my company now). I really find it very convenient since I don’t have to rush to the nearest BDO branch (though the nearest one is in the Ground Floor of our building, lol) just to deposit funds. And you’re absolutely right, no Savings Account can give me that much gain. Well of course, I have yet to study about these kinds of products or I would like to join a warfare without any ammo. But for now I’m happy with the fact that I’m a step closer to my dreams.

  22. ann says:

    “This means if I invested P10,000 last year when the NAV reached 2,627.61, then my money would have been worth around P10,652.76 today. No savings account, nor time deposit interest, can earn you that much from just P10,000 – that’s around 6.52% increase in your money.”

    ********

    Hi, Fitz. I have question, can I just withdraw the profit of my money and leave the capital? like for your example, you’ve earned 652.76, can you withdraw only that amount and leave the 10,000?

    and

    Is there a holding period for this kind of investment, peso balanced fund? is this like a time deposit or SDA that after a month, someone from the bank will call me and ask if I will roll over the amount? thank you. More power to you and to your blog. :)

  23. Fitz says:

    Hi Ann,

    Think of investing in UITF like “buying and selling” something, in this case, you are buying “fund units” which you will sell when its value goes higher.

    To make it simpler, here’s an example of how UITF works at the most basic level.

    NAVPU (net asset value per unit): P1,200.00

    If you want to invest P10,000 – then that means you will be buying 8.3333 units of the fund.

    Usually, the holding period is 30 days. After that, you can redeem any number of units.

    So let’s say after a month, the NAVPU is P1,300.00 – this means your 8.3333 units is now worth, P10,833.33 (NAVPU price x units owned).

    If you want to withdraw the P833.33 “earnings” – then you have to sell 0.6410 units. If you do, then you will be left with less units invested.

    8.3333 units (original) minus 0.6410 units (redeemed) equals 7.6923 units

    There is no “roll over” because after the 30 day holding period, you can redeem your units anytime and the number of units that you own do not change, unless you buy more units or sell some of it.

    The investment earns because the price per unit (NAVPU) changes over time. And the rate of change is generally higher than a time deposit – that’s why it’s better to put your money in a UITF because your money grows faster.

    However, do note that the NAVPU can also go down – this really depends on the economy. This is where the risk comes in. Let’s say the NAVPU goes down to P1,000 in the example above and you need money, then you have no choice but to sell units at a much lower price than the amount you bought it.

    =====

    The best analogy that I can think of is collecting stamps.

    When you’re investing in UITF, it’s like you’re buying old stamps. The value of those old stamps can go up or down over time. But since it’s a collectible, the value will generally go up.

    When the time comes that you need money, then you can go back to your stamp collection and sell any number of the stamps. If the value of the stamp has increased, then you earned money. But if the value of the stamp went down, then you lost money.

    I hope my explanation is clear.

  24. JR Rosales says:

    Fitz,

    Can you explain the “spin-off” concept, further for example I will invest 5k monthly?

    Thanks.

  25. Fitz says:

    Hi JR, spin-off means that you already bought at least P10,000 worth of units, which qualifies you to receive a “Confirmation of Participation”.

    For the first month, you will buy P5,000 worth of units. Those units are “floating”… it means they are already yours at the price you bought but you can’t sell it because as per BDO, the “actual” minimum investment required is P10,000.

    For the second month, you will buy another P5,000 worth of units. Since you have now P10,000 worth of units, then a “spin-off” will happen, and you will now receive the “Confirmation of Participation” and be able to sell those units after the holding period.

    For the third month, you’ll again have P5,000 worth of “floating” units… and so on.

    After two years, expect to have 12 of those confirmation papers, which are actually your proof that you own the specified number of units.

    Moreover, to my understanding, you can sell your units in one “Confirmation of Participation” separately from the others, just in case you need money.

    I hope I was able to explain clearly. Thanks!

  26. Franz Steven says:

    Hi,

    Can I just add something about the spin-off thing? Just for everyone’s information. According to the guys at BDO-TIG, when you want to redeem your placements and your placement amount is less than the spin-off amount (P100,000 for Money Market or P10,000 for other UITFs) you will be the charged an Early Redemption Fee of 1/2 of 1% of the invested amount. That’s mainly the reason the trust institution encourages diligence in saving among the Fund enrollees.

    I’m not sure if this makes anyone excited, but from what I heard BDO has this Rewards thing that when your trust placements reach P500,000 or so you get to earn points. How does rewards points sound? Haha. :)

    For those still asking and are interested about the EIP, you can always attend the free seminars held by BDO-TIG.

  27. Tina says:

    Hi,
    about the seminar held by BDo-TIG, i tried asking the employee handling my aplication for EIP(its my first time and i’m realy not well informed about this, all i know is that the money i’d invest is something i’m willing to risk losing)… and this employee said that it is only given to BDO employees, if for some reason she was wrong and i could attend, where and when?also,will i need to apply for a registration somewhere?
    i’d like to learn more about this investment thing. thnx.

  28. Franz Steven says:

    Hi Tina,

    Just to clarify, according to the guys at the BDO-TIG, the EIP was once offered to the BDO employees for like 2 years as of 2011 when I first attended the seminar (they told us the EIP was only opened to the public on November 2010).

    Frankly speaking, that employee you inquired to is awfully wrong. The only proof is in the publishing of this article by Mr. Villafuerte.

    About the seminar, check out BDO-TIG’s website (http://trust.bdo.com.ph/trustwebsite/personal.asp) for seminar announcements, and from what I’ve checked as of April 16 the upcoming seminar is on May 5 (Saturday). Don’t worry, you’d learn a lot from their seminar. Trust me, I got in there thrice. And the seminars are fun and interactive at the same time.

    For registration, you can visit any BDO branch and go to the New Accounts section; tell the Client Officer that you want to enroll for the EIP. But prior to that, you should have fully understood the seminar how-to’s and all so that you’ll make the most of your UITF. :)

    Hope that helps, that’s only coming from a satisfied EIP member. :)

  29. lioncityrebel says:

    Hi Fitz,

    I was digging your archives to kill time–which is a productive way to do so!–and stumbled on this article.

    How’s your BDO investment thus far? Still happy?

    How does this fare with BPI’s Asset Management (RSP, PERA)? I have difficulty comparing the two because I find BPI’s a bit complicated. BDO has a more upfront product offering. Or maybe it’s just me.

    This is a long shot but I hope there is a system for this to reach you.

    Thanks in advance!

  30. Fitz says:

    @lioncityrebel
    Hi, thanks for reading through my archives. :D

    Currently, after 9 months, my BDO EIP fund value is 20.7% UP. Yay!

    I also have a BPI RSP, it’s been going for almost 2 years now. Currently, it’s 6.7% UP. Yay too!

    The one I have in BPI is a low-risk UITF (that’s why the “income” is smaller) and the one I have in BDO is a moderate-risk UITF (that’s why the “income” is bigger).

    Also, personally, I observed that from past performance – BDO gives higher % yields (but only by a few points) when you compare same-risk funds with BPI UITFs.

    But my advise, why choose when you can invest in both, right? A good way to diversify too. :D

  31. Enzo says:

    Hi Fritz,

    I have already started investing directly to the stock market using peso cost averaging method and only buys shares of blue chips companies in different industries. My objective is for retirement, time frame is at least 25 years from now (I am 24 years old), and risk tolerance is aggressive. However, I am also setting aside part of my savings for future “big” spending such as down/full payment of house and lot, wedding, insurance. That would be my next objective. Time frame would be 6 to 8 years from now and my risk tolerance is from low to moderate. I am considering investing in the mutual fund/UITF to further diversify my investments. My question would be:

    1. Am I still diversifying if I am already directly investing in the stock market but will also invest in mutual funds/UITF using the Equity fund program?
    2. Given my investment objective, time frame and risk tolerance, where will you personally suggest to place my savings?

  32. Fitz says:

    Hi Enzo,

    Thanks for the comment. Here’s my brief opinion regarding your questions.

    1. Yes, you’re still diversifying. MF / UITF equity funds have speculative stocks in their portfolio, which you don’t have in your personal stock portfolio.

    2. I’d say you have it right by choosing a low to moderate risk MF or UITF. Personally, I’d choose a moderate-risk fund.

    Wishing you all the best in your investment. Be sure to always monitor them, and continue to grow your emergency fund as your monthly expenses increase over the years.

  33. Enzo says:

    Thank you so much Fitz! =) Correct me if I’m wrong, but I’ve also realized that what is good about investing in the equity or balanced fund is that, since these are pooled fund, even though you contribute only 1k per month, you still get to benefit from the growth of other big companies in the fund manager’s portfolio that are really expensive to buy (i.e. PLDT, who has a board lot of 5 BUT stock price averaging at 2,700, meaning you need at least P13,500 to buy their stocks!).

    Anyway, that’s it, I’ve decided to choose balanced fund for my big spending in the future! yipee! I will either invest through UITF (BDO EIP – since I have a savings account there) or mutual fund (FAMI). Help me on this, Fitz! =)

    Thanks in advance!

  34. nica says:

    Hi fritz,

    ur blog is really great…i wish i had started investing 3 yrs ago..
    by the way, im 28 and my investment objective is really to put up a business or just be done with employment after two years..after that, i want to focus on volunteer work kaya nga as much as possible, i want to save a lot so i can resign from my job and have enough for my personal needs while i have the freedom of time to spend on humanitarian stuff..
    i am not sure if 2 years is enough…im saving 10k a month..
    my question is, is it better sa online stock market maginvest or sa uitf..i work sa gabi so from 8 am to 2pm,(sleeping time) eh may time ako to monitor my investments if ever..when it comes to education, im crunching on blogs and would like to attend free seminars about stock market, can you recommend one? and yun nga im thinking of opening an account sa citisec…what are your thoughts? pls i need guidance and i couldnt find one in my workplace kasi although we help people invest, (i work ina call center and we handle US stockmarkets for retirees), people there are very into employment and all they want is to get promoted…but i don’t see my future there..anyway..pls give me some tips, really dont know where to start…thanks a lot and more power!

  35. Fitz says:

    Hi Nica,

    First of all, there really is no better investment – and both stocks and uitf investments have their pros and cons.

    What I usually recommend, diversify and invest in both.

    Since you’re able to save 10k a month (which is a lot!) – then why not divide them and invest 5k in stocks and 5k in a uitf.

    You can do cost average investing through Citiseconline’s EIP (for stocks), and BDO’s EIP or BPI’s RSP (for UITF). Don’t know if other banks offer the same service as well though.

    In any case, 2 years for me is a bit short as a time horizon for stock investments, but it is still a viable option – just be sure to only buy blue chip companies and you’ll do fine in my opinion.

    As for UITF, you might want to get moderate-risk products because their high-risk / equity funds (which invests in speculative stocks) might not suit your 2 years investment horizon.

    Moreover, you’ll be glad to know that with such products, there’s really no need to monitor them constantly – once or twice a month is usually more than enough.

    Lastly, Citiseconline offers free stock market seminars – if you’re interested, just email me and I will help you get in touch with my account manager there.

    All the best,
    Fitz

  36. Annie says:

    Hi Sir Fitz,
    With full of sincerity, I wanna thank you for the Ready to be Rich website as I am one of your subscriber and it serves me as a BIG EYE OPENER to Financial Literacy which I am longing for, for the longest period of time. I have learned a lot from your blog and in time I know I will be financially free.

    I am interested in Investment, browse the net on how to compute compounded interest, in reality since I am a newbie, still hesitant but no matter what I have to start.

    I still don’t know where to invest but I am already checking some banks and some online broker to help me decide which investment to take. However, I would gladly take your advise on what investment to take that you’ve think will fit for me as I am new to this.

    Again, thank you very much

  37. nica says:

    hi, thank you for such a prompt response…sorry to have follow up questions.

    first, can you give me examples of blue chip stocks in the phils? is ALI one of them? MBT, BDO, SM, FGEN?

    next, i ma really interested in attending a seminar to get me started…i just noticed that they don’t have schedules on weekends,..im a call center agent and it’s hard for me to have it during weekdays..should i just continue reading online materials?

    thank you so much FITZ..(got ur name right this time)..hehe
    i also read some of yoUR ARTICLES about blogging, you must be a very busy person which makes me appreciate more the fact that you were able to answer questions as basic as mine before…

    thank you is not enough i know, but hopefully i can hit the donate button next time..(once i have something to donate);p

  38. Fitz says:

    Hi Nica,

    For a list of recommended companies in the Philippines, you can check out this post.

    Attending their seminar is not a requirement but would certainly help, although reading online materials would certainly give you the same information – you just have to be diligent about self-studying.

    Lastly, thanks for being willing to hit a donate button – on my end, helping me spread this blog’s reach is always more than enough. :D

  39. vicky says:

    HI! Im so thankful for this thread.
    I was nearly into getting an expensive pension plan and during my learning process, i’ve learned about mutual funds until i came to UITF (HERE).
    Been reading your blogs… pls helP!
    I already have Emergency fund, life insurance, and will be getting educational plan for my daughter.

    Now I am planning for retirement. Im only 28 years old and so willing to invest continuously. Can you give me advice pls?
    Thank you so much.

    Very important Question: How much money is the safest to invest, where? i want moderate to high risk investments for higher returns

  40. Fitz says:

    Hi Vicky, there’s no one formula that a person can follow when it comes to investing. Each person is different.

    But in my personal opinion, you should invest whatever amount you think you can afford to invest regularly.

    This means, asking yourself, how much “extra money” do I have every month? That amount is the amount you invest.

    For a retirement fund, it’s always recommended to put it in an equity fund and continuously invest for several years in it.

  41. Vicky says:

    Thanks! Now I just read BO Sanchez’ book called “My maid invests in the Stock Market”

    Now, its very convincing to invest in Stock Market instead.. Can you help me decide? which will give me higher returns?

    Thanks!

  42. Fitz says:

    Hi Vicky, both equity funds and the stock market are good retirement fund investments – returns are almost the same because they after all, invest in the same instrument… publicly listed companies in the Philippines.

    My advise, invest where it would be convenient for you. If it would be easier for you to go to BDO, then invest there. If it’s more convenient to invest with another bank, or with a stock broker, then invest there.

    Lastly, my recommended stock broker is Citiseconline, and their office is in Ortigas. If you’re interested in opening an account with them, you can call them anytime at 6515888, tell them you’re interested with their Easy Investment Program and tell them I referred you to them.

    Thanks,
    Fitz

  43. Vicky says:

    Thanks Fitz!
    I was really considering Mutual Funds before Stocks after I read this.
    http://www.perakoto.com/2012/08/disadvantages-of-mutual-fund.html

  44. Ernst says:

    Hi Fitz,

    I just opened an EIP account with citiseconline and I knew that it will grow through stocks. I haven’t yet read the whole detail of BDO’s EIP, so I would like to ask you if you could give me some background about BDO’s EIP. Like How will it grow? Is there a chance of getting loss?

    Thank you.

  45. Fitz says:

    Hi Ernst, the concept is very, very similar.

    Instead of shares of a company, you are buying “units” of a fund (which you will choose) in BDO’s EIP. All the mechanics is the same.

    You will earn (or lose) money depending on the NAVPU (net asset value per unit) of the fund you bought.

  46. Pen says:

    Have UITF as well with BDO, and recently opened EIP as well for “forced savings”. Was advised though that the money will only start earning once it reaches the investment minimum (e.g. PHP10k), which means the amount invested monthly (e.g. minimum PHP1k) will not yet earn until the 10th placement. Is this your experience as well?

    bulbsandbubbles.blogspot.com

  47. Fitz says:

    Hi Pen.

    You will receive an investment certificate once the amount reaches P10k. The price per unit in that certificate will be the retroactive value of the past months while you are accumulating that P10k.

    Which means, you are already earning as soon as the 1st placement, but you won’t be able to redeem it, and have an official certificate of the investment, until you reach P10k.

    For example, if you’re investing P5k a month. And on Month 1, the NAVPU is P1. Then you’ll have 5,000 units. Then on Month 2, the NAVPU becomes P1.25. Then you’ll have 4,000 units.

    You will not receive a certificate at the end of Month 1. But you will receive one at the end of Month 2 because you already reached P10k.

    When you receive your certificate, you’ll see that your original principal is P10k which represents 9,000 units.

  48. Pen says:

    Thanks Fitz for the clear explanation. Actually invested in EIP precisely to take advantage of cost averaging even if with small amounts only and as soon as month 1. Now your explanation confirms this.

    Regards,
    Pen (www.bulbsandbubbles.blogspot.com)

  49. JAYPEE says:

    pwede ba magenro sa uitf kung wala akong savings account sa bdo?

  50. Fitz says:

    Hi Jaypee.

    I think they’d require you to have a savings account with BDO because that will be your nominated account where they will deposit your money once you redeem your units.

    But I could be wrong, and you better ask the bank regarding this – particularly if you just plan to invest one time in their funds.

    Although if you plan to do the EIP, I believe it is required because that’s where they will take the monthly investment amount.

  51. josephine says:

    i started investing in bdo equity fund aug 2011 with 4kmonth,based on their yield calculator my 66k grows to more than 90k so i have a 20k plus earnings,yehey!

  52. Nina says:

    Hello Fitz!

    It’s dawn and I am still here so engrossed with your blog and investing. You are very helpful!

    I would like to ask:

    1. Say you have 500K or more and you won’t need to touch it for at least 5 years, is it wise to invest it in for example, BDO’s Equity Fund?

    2. Is it better to start with a lower amount even if you could invest more?

    3. If you have invested a big amount already, is it okay not to add more to your initial investment/ not deposit additional funds to it and just let it grow?

    Thanks a lot!

    Nina

  53. Fitz says:

    Hi Nina. I’m glad you like my blog. To answer your questions:

    1. Yes, it’s wise to invest it. BDO’s Equity Fund is just one of the many products you can choose from.

    Invest where it will be convenient for you and where you already have an account. Other commercial banks have their own equity funds as well. Personally, I recommend BDO, BPI and FAMI (through Metrobank) – not necessarily in that order.

    Look into mutual fund companies as well, which also have equity funds, notable companies are Philequity and Sunlife – but there are also others.

    Also, depending on your investment objective, you can likewise choose to invest in a lower risk instrument such as a balanced fund – all the banks and MF companies have them as well.

    2. Personally, I like investing only in small amounts, but regularly, over a long period of time. Doing so makes investing a habit for you and not just a “one-time task” – which is important when it comes to establishing a “wealthy mindset”.

    Moreover, cost averaging works for me as an investing strategy, and that’s why I highly recommend it.

    3. That depends on where it is invested and if that instrument can achieve your objectives. But in general, if the investment is doing good, then it’s okay to just let it grow.

    Let’s say you have P500k invested in a fixed income fund, which has been growing by 5% a year. Ask yourself, what are you going to do with that money?

    If it’s to buy a P1.5M condo 5 years from now, then you will not be able to achieve your goal.

    So it would be better to take out the money, and then re-invest it in an equity fund (for example) which earns at a much higher rate (around 18% per year average, but recently, because the Philippine economy has been on an uptrend, it’s been more than 30% per year).

    But if the money is to for a business you plan to put up in 3 years, and you just need to put the money now in a “safe place”, then you can leave it there. A fixed income fund is a relatively low-risk investment, which ensures at the very least, you’ll have the full P500k plus some income, when you withdraw it.

    Hope I was able to help.

  54. Nina says:

    Thank you Fitz, very helpful insights! I have decided to split my money and invest half of it on a fixed fund that earns 4.75% interest p.a. and half of it on equity funds.

    Regards!

    Nina

  55. nica says:

    hi fitz, if u cud remember.i posted here last year asking where to invest my m0ney.ar0und aug.i did open an account and made several purchases back then until my gross contributi0n reached 50k.aftr oct.i wasnt able to add anythng to it bc0z of s0me unexpectd expenses.ryt n0w,its up to 62k! Thats more than 20% unrealized gain.im still w0ndrin if u have heard anythng bout how d market will perform this year.or in d next few m0nths,gven r political situation ryt now.r u going to make any drastic m0ve with ur stocks?lyk selling them for n0w?nd wait til d election is over?

  56. Fitz says:

    Hi Nica, congrats on the 20% unrealized gains. And don’t worry if you’re not able to add to that – you can always start investing once you can afford it again.

    Unfortunately, nobody can ever really predict where the market will go and the best thing you can do is to monitor your investment.

    Personally, I’m not doing anything because I believe the economy will still continue to grow until the next presidential elections.

    Prices will definitely stall or go down a little because of the upcoming polls, but if nothing goes wrong during and after the elections – which would most likely be – then growth will continue for the country.

  57. raki says:

    Hi Fitz, I’m a newbie here and I just want to know more about UITFs like BDO EIP. I noticed on the BDO website that their NAVPU for Balanced fund is already at 3,7++ and what will happen if I will invest starting at 1k only? Obviously my 1k is not enough for the current NAVPU. Will BDO wait for my money to reach 3,7++ before they will consider my contributions? Thanks in advance. :)

  58. derick says:

    good day mr. fitz, im a newbie and very interested in the program on investing even for a small amount, do you had any idea or suggestion? i want to be an investor same like a mutual fund that could start in amount of P10,000. i hope you could help me, by the way im an ofw. thank you.

  59. derrel says:

    hi,Fitz

    im am also a newbie, i just want to ask is there a way that we can manage our investment online w/ BDO EIP, i want to do it in my own picking up stocks. do we have an option to select our stocks in bdo eip?
    thank you.

  60. Fitz says:

    @raki, you will get a fraction of a unit at current price for your 1k. Then when the sum reaches P10k, you’ll get a certificate containing the total units you own for that “lot”.

    @derick, being an investor means you have to do it regularly. You have to choose an amount that you can afford to invest monthly (or quarterly) for many years, and then choose a mutual fund which can help you grow that money so you can reach your financial objectives.

    @derrel, UITF’s are designed so that you, as the investor, won’t have to study the market – investment funds are handled by expert fund managers who do all the investing decisions. If you want control and pick your own securities, open and invest with a stock broker instead because you don’t have that choice with BDO’s EIP.

  61. edmund lao says:

    a comment from my colleague , Wency Chavez :

    Sir Edmund and I attended this last February.. I really find it helpful…

    By the way, there is another upcoming seminar by BDO…
    Seminar details:

    Date: April 13, 2013 (Saturday)

    Time: 9:30 AM (Registration)
    10:00 AM – 12:00 Noon (Seminar Proper)
    Venue: Officers’ Lounge, 22F South Tower, BDO Corporate Center, 7899 Makati Avenue
    corner H.V. dela Costa St. Makati City.

  62. derrel says:

    thanks for the info.

  63. Christian P. says:

    Hi Fitz

    Been reading through your post for quite sometime now, and I find very educational and informative for us newbies in the investment world.

    Well for my question,

    1.i have invested in BDO peso bond fund since I thought it would be safer for me to invest in government fund with moderate risk, and plan to stay with the program for atleast 3 years do you think it is a sound investment..?

    2. Though thru this post I’ve read that BDO equity fund does have better gains, do you think it would be better if transfer the investment (bond fund) to equity? Or better to have a separate investment for BDO equity fund?

    Thanks Sir Fitz Moore power to you!

  64. Christian P says:

    Hi Fitz

    Just wanna ask, I put my on BDO’s peso bond fund, I think it is safe since it deals with govt bonds… However do you think it is a sound investment?

    Also which do you think has better growth the bond fund or equity fund?
    Since as per this posting I’ve read through the comments that equity fund generate more gains…. Do you think it’s better former to transfer the investment or stay with it and invest a little also in equity? So it will be diversed.

  65. Fitz says:

    Hi Christian,

    What is your investment objective? What is the money for and when do you need it?

    Answer these questions for me first because that will determine which fund you should put your money in.

  66. Christian P. says:

    Hi fitz

    Im planning to use the possible gains for another bussiness venture and most likely planning wedding also I will not be needing the money in the next 3-4 years…what do you think?

    Btw been an avid fan of your articles very Informative and educational…

  67. Fitz says:

    Hi Christian, for that purpose, you can safely invest in a balanced fund. Then on the 3rd year, perhaps rebalance your portfolio and lock in your unrealized gains and funnel your investment to a low-risk money market or fixed income fund. I recommend equity fund only if the investment horizon is more than 5 years.

  68. Christian P says:

    Thanks for your insight

    In which case do I have to transfer my investment into BDO balanced fund? Or it is ok to stay on the BDO bond fund?

  69. Christian p. says:

    Do you think 50k under equity fund is already a sound investment and let it stay there 5-8 years?

  70. CEB says:

    Thanks for the tip… planning to put up a small investment sa bdo today, pero they don’t accept pala on weekeneds… will try ulit sa monday… will try muna yung Equity Fund.

  71. arnel says:

    im recently enrolled in BDO EIP,can i enroll EIP in online banking of bdo???i want to monitor the funds that have been deducted in my settlement account.ill be waiting your answer??thanks

  72. Fitz says:

    Hi arnel, yes it’s inside your account. You can see all your Trust Investment activities, including current value, there.

  73. vin says:

    Hi Sir! Is there a way to monitor the performance of my contributions daily?

  74. arnel says:

    thanks sir,how can i enroll my eip account in online banking??

  75. Fitz says:

    @vin
    Apply for online access to your account.

    @arnel (and vin)
    Just go to your branch and tell the manager you want to apply for online access.

  76. jamin says:

    Sir I invested in bdo equity fund on april 16 2013 and bought the unit per share amounting P412, and when i checked the NAVPU today i saw that it went down to P359/unit. does that mean that my investment has already been wiped out? I need clarification please..

  77. dang_newbie says:

    Hi Sir Fitz,

    Sir need your advice, I am a newbie in stocks and I want to join Citiseconline? I dont know if this the best option for me right now. I also read about your BDO EIP article and got also interested. But I don’t know what’s the best for me. I am currently in a 12k salary monthly but no dependents. Thank you and hoping for your advice.

  78. Shielahgrace Reyes says:

    How can i apply in UITF if im here in UAE and I have no chance of going home to philippines even after next year?

  79. Allen says:

    Hi Fitz,

    Thanks for this post. I recently opened an EIP last month.
    By the way, I am curious on how trust fees are computed. Do you have idea on this?

    Thanks in advance!

  80. anna says:

    I just opened an initial account of 10k for peso balance of bdo, ask ko lang how much ung iddebit nila sa kin monthly?

    thanks

  81. Nikolai says:

    magkno ung minimum initial investment interesado ksi ako e

  82. Mel says:

    Hello! It’s been 2 years since this post, may we get an update what has happened with your BDO EIP? Thanks so much!

  83. Fitz says:

    Hi Mel, thanks for the question. I’ll do that now. :D

  84. yen says:

    Hi Fitz,

    I really don’t know where to park my efund. Can you give me some recommendation on where possibly could I deposit my efund? I can only afford 1K per month for efund savings.

  85. G says:

    Hello. I’ve a question. What do you think about high yield time deposit? Say, I would invest 50K for five years, tax Free, that means more gain and No losses right?

  86. wilson belen says:

    Hi Fitz,
    I’m ofw and i want to invest in bdo with 50k per month,so what will be the best option suited for it ?Where in there’s a high interest returns annually?And what if i have 500k and i want it to grow up on a year in just one time investing.?Can you give me a better suggestion with that two scenario…thank you :)

  87. Jonas says:

    Hi Sir Fitz,

    I learned a lot from your blog, by the way, do you know BDO Sustainable Dividend Fund? Would you advice investing on it?

    Thank you

  88. Beth says:

    Thank you for explaining those different kind of investment whereas can gain more compare to ordinary savings acct or time deposit…
    I have a time deposit amounting to 500K for abt 2 years now. But it gains for 9k only.
    If I knew and read this blog earlier I will put that money on equity or peso balanced fund

  89. richard D Re says:

    Hi fitz i plan to apply BDO EIP in balanced fund 10k/mnth. it means i receive COP/mnth?

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