At last, the Philippine Stock Exchange offered to the public on December 2, 2013 the country’s first listed ETF or Exchange Traded Fund with the First Metro Philippine Equity Exchange Traded Fund, Inc. (FMETF).
After waiting for several months from the time First Metro Asset (FAMI) and PSE announced their planned ETF offer, I finally got to invest a few FMETF shares early this morning before things got busy at the office.
For investors with existing stock trading accounts, now’s the chance for you to avail the country’s first equity ETF (Exchange-Traded Fund) through their respective Philippine stockbrokers.
For first time investors and OFW’s based abroad, if you are interested to invest in ETF’s, you need to open a stock trading account to participate and buy shares.
What is an ETF or Exchange Traded Fund?
An Exchange Traded Fund (ETF) is a publically traded fund that is built to track or closely mirror the performance of a basket of securities, assets, or benchmark index.
It is actually a mutual fund or a collective investment scheme whose shares can be traded in a stock exchange.
The Fund aims to provide returns which would reflect the performance of the Philippine equities market by investing in a basket of securities which are included in the PSEi of the PSE. The portfolio of the Fund is to be rebalanced and reconstituted every six months in order to adjust to the current composition of the PSEi.
What are the Advantages of Investing in ETFs?
Immediate exposure to the whole market by buying one security
• Performance closely resembles that of its tracked Index
• Auto-Diversification as the fund owns various shares of stock
• Lower fund management fees than Mutual Funds
• Can be bought/sold throughout the day
For new investors, investing in ETF’s would make things easier for them. When investing in the ETF, it’s like investing in all 30 top Philippine stocks composing the PSE index minus the headaches and worrying which stocks to invest in because it already mirrors all of them in just one fund.
Here are the top 10 out of the 30 stocks that FMETF is invested in:
How To Start Buying ETF Shares?
For experienced stock investors, no need to open a separate ETF account. An investor will just have to place an order similar to buying regular/common shares. He/she just have to type the stock code FMETF when buying shares.
FMETF has a minimum boardlot of 10 shares.
For new investors, investing in ETF’s is easy.
First, you need to allocate funds that you want to invest. REMEMBER: Your minimum investment will depend on the price of the ETF and the PSE minimum board lot (10 shares).
Second, register with any of the 134 PSE brokers such as FirstMetroSec, COL Financial, BPI-Trade, Philstocks, etc.
Third, start buying and selling the ETF shares.
To understand more about ETF’s, watch this video from Investopedia:
Continue receiving more updates about investment vehicles and financial instruments in the Philippines by subscribing to BurnGutierrez.Com for FREE.
Rock your way to abundance!
P.S. 1. Bro. Bo Sanchez has appointed me as a coach for our young and new investors at the TrulyRichClub social site. It’s a fun, learning family with the purpose of “helping good people become rich”. I’m inviting you to join the TrulyRichClub too and email me at firstname.lastname@example.org if you have any questions. Click here to join!
P.S. 2. My co-author/illustrator Des Feliciano and I have just launched our “The Adventures of Pepot Kuripot and Dora Gastadora” comic book! It’s arguably the first and only personal finance-influenced comic book in the Philippines. Order your copy now from our website http://pepotanddora.com and have it delivered right at your doorstep. Or you can grab your copy yourself at The Pantry at 07 in Makati City and ilovemilktea in Las Pinas City. Now available also in Australia, Saudi Arabia, and the USA! Email email@example.com for more details.
P.S. 3. If you are based abroad or just outside of Metro Manila and has been itching to learn more on how to jumpstart your business dreams, join me and my friend, serial entrepreneur Ginger Arboleda, as we take you through a series 2-hour webinars (for 11 Saturdays) that will help you focus on the technical skills and specific things that you have always wanted to know about in order to grow your business. We have come up with 10 sessions with 11 expert lecturers (with 1 FREE session if you enroll in the full program) that will make you a stronger and better entrepreneur. Register here to join the Enter Entrepreneurship Webinar Program now!
P.S. 4. Are you an OFW who’s been looking for a investment placement where your money could grow higher than your time deposit accounts? Are you outside of Metro Manila and would like to start investing in mutual funds but have no personal advisors to help you out? Click here so I can help you open a mutual fund account NOW! .
More from my site