Updated: May 12, 2017
Three years ago, I invested in BDO’s Peso Balanced Fund through their Easy Investment Plan (EIP).
If you don’t know what the BDO EIP is, it’s a service by the bank wherein they will automatically debit a fixed amount from your savings account and invest it in your chosen Unit Investment Trust Fund.
I chose to invest P5,000 every month in the BDO Peso Balanced Fund, which started back in September 2011 and is still ongoing today.
Today, I’m sharing you an update on that investment.
First, here’s a screenshot of the investment status taken from my online banking account. If it’s too small, then just click the photo to see the full size.
What are you seeing here?
I’m investing P5,000 every 15th of the month (13th or 14th if the 15th falls on a weekend) and I will only get a Confirmation of Participation (COP) every time the investment value reaches P10,000.
Each row in the table represents one COP (this column is not shown). The first COP, which is the first row, you will see that the invested amount is P15,232.39 and was placed in November 15, 2011. Meanwhile, the next COP (2nd row), the invested amount is P10,226.02 and was placed January 13, 2012.
The table below illustrates how this is happening:
The “Number of Units Bought” is P5,000 divided by the Net Asset Value Per Unit (NAVPU). Meanwhile, the “Total Units without COP” is the running total of units without COP. Lastly, the “Value of Units at Current NAVPU” is the running total of units bought without COP multiplied by the latest NAVPU.
Get a calculator if you want to confirm the computations. But if you can’t fully understand this, then it’s totally okay because this all happens automatically anyway. Personally, I just call my BDO branch and ask them if I have a COP.
This process just goes on and on, and the “Amount as of [DATE]” is the present value of the COP if I cashed out that specific COP.
The photo below is that first COP from November 2011, which according to the screenshot above, is now worth P20,710.39.
How’s the investment performing?
In a span of 33 months, I’ve already invested a total amount of P166,845.09 and if I cashed out all of my units last May 16, 2014, then I would have received P187,087.73 – and earned P20,242.64 for myself.
By using a Time Value of Money (TVM) Calculator, I am able to discover that my investment is currently growing at a rate of 8.73% every year.
Type this in Excel to confirm: =RATE(33,-5000,0,187087.73,1)*12*100
I’m happy with the current performance of my Balanced Fund, that’s why I’m continuing the BDO EIP.
Savings Account and Time Deposit
Assuming I did not invest the P5,000 every month and instead, just put it in a savings account or a time deposit. Then here’s what will happen to my money:
I’m sure glad that I put my money in a UITF Investment.
How about you, where are you putting your money?
This post is NOT sponsored by BDO, nor is it an endorsement of their Balanced Fund. You should know that I also have UITF investments in BPI, and other banks.