SOUND BOARD: ALFM GLOBAL MULTI-ASSET INCOME MUTUAL FUND

NEW MUTUAL FUND ALERT!

 

Snapshot of COL's Overview of ALFM Global Multi-Asset Income Fund

I have just noticed today that there is a new mutual fund listed in COL Financial. It's the ALFM Global Multi-Asset Income Fund, with fund code XALGMIF. It was launched last June 01. 

It caught my attention because (1) XALGMIF is multi-asset, meaning, it invests in bonds and other investment vehicles, not just equities, (2) it is income paying, hence, dividends can be expected of the fund, (3) it is global because the target fund (of the feeder fund) invests in assets found outside the Philippines, where economies are so much better; and (4) it is relatively affordable because it is a feeder fund, which requires a minimum initial investment and minimum additional contribution of Php 5,000.00 and Php 1,000.00, respectively. A feeder fund is a pooled-investment fund that will allow us to invest in a relatively "expensive" target fund like Blackrock's BGF Global Multi-Asset Income Fund, with just a min. initial investment of Php 5,000.00, compared to USD 100,000.00 if we are to directly invest in the target fund without going through the feeder fund. The discussion on feeder fund and target fund, however, deserves a separate blog entry.

In other words, XALGMIF is like a Balanced Mutual Fund only that you are invested in the global market instead of the Philippine market. It becomes possible for us to afford investing in global market because of the feeder fund.

I only peeked at its Fund Fact Sheet and will study it thoroughly after I finish all my deadlines at work. (Hehehe!)

Sneak peek: the  asset allocation of the target fund of XALGMIF is comparable to that of ATRAM Global Multi-Asset Income Feeder Fund. The latter, however, is a UITF and therefore not available in COL. Neither is it available in Seedbox and GInvest, making XALGMIF the more accessible fund to invest in for COL account holders like me.

To do: I am quite excited to dive deeper into multi-asset income paying feeder funds like XALGMIF. Unlike equity feeder funds, which are high-risk high-reward investment,  multi-asset feeder funds provide us diversification and a certain level of stability. Thus, it is something worth studying. Maybe, it is worth my longer Think Piece!  

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You may want to check the news report about ALFM Global Multi-Asset Income Mutual Fund at 

BIMI launches feeder and income-paying mutual fund

SOUND BOARD: Etoro Social Investing Update

WOW! 

It's been a while since I have updated this blog. Today is November 30 and it's Bonifacio Day, a holiday, a non-trading day in the Philippines. This is a very special day so I want to celebrate this day by updating this blog. What a weird way to celebrate! Hehehe.

Anyway, I am just happy to share with you that the traders I copied in Etoro are now making profits after experiencing volatility in US stock market. There has been a renewed optimism in the market after news of potential vaccines against COVID-19 came out. 

I will be doing a separate blog on what led me to social investing in Etoro and what led me to "copy trade" Miyoshi, jianswang and MarianoPardo, so please watch out for that.

I started to copy trade Miyoshi in May, and jianswang and MarianoPardo in October. So far, jianswang's cumulative performance in just one month is superb at 14.19%. 

My profits from my initial investment in Miyoshi has always been steady at 4% to 8% since May, but I hope that it will still improve in time for the yearend. Meanwhile, my profits from MarianoPardo are now climbing up and starting to pick up the pace after I suffered a paper loss of at least 4% early in November because of him. Good thing, my investment horizon for social investing is long-term, thus I am not rattled by that temporary drawback in my portfolio. 

In any case, I trust that the trio would be able to sustain their profitable performance given any market condition because they are skillful traders --- precisely that is why I chose to copy trade them. They know what to do!

Etoro Portfolio as of 30 Nov 2020

Etoro newsfeed as of 30 Nov 2020

SOUND BOARD: Yay! PSEi was up but why?

1. The Philippine Stock Exchange Index (PSEi) is a capitalization-weighted index composed of stocks representative of the Industrial, Properties, Services, Holding Firms, Financial and Mining and Oil Sectors of the Philippine Stock Exchange (PSE) [Bloomberg]. It  was up on 29 May 2020 because we had a net foreign buying of 955.39 Million Pesos; that means, foreign investors were buying shares of stocks in the PSE more than they were selling, which drove the PSEi up by 4.82% or 268.62 points from 5570.22 to 5,838.84 level. The proximate cause could be that there is some level of certainty now that businesses in the Philippines will open and operate come June 01, prompting foreign investors or traders to come in.

Net foreign buying of 955.39M catapulted PSEi above its 50-day Exponential Moving Average 

2. The role of foreign investors or traders in the PSEi is important as they add volume and liquidity in an otherwise thin market; simply put, they have the money that could instantly impact the performance of the PSEi. Absent foreign investors or traders participating in the stock market, PSEi would have no momentum to rally and breakout from its resistance level as what happened to PSEi in the past two and a half months.

The encircled green long column signifies large buying volume which can be primarily attributed to net foreign buying.

3. It is actually only the second time since March 16 that we had net foreign buying. The first time was on 05 May 2020. All other days, we had net foreign selling, which suggests that foreign investors are pulling out their money from the market and placing it somewhere else. If we "follow the money" as the saying goes, we will probably end up in the global market where there is volume and liquidity. That's why some popular traders or investors have also focused their attention to the global market. I just follow suit and am starting to learn more about trading and investing in the US stock market for diversification.  Of course, it is always recommended to invest or trade in our own stock market to help our economy recover or grow faster.

SOUND BOARD: What to expect because of the MSCI rebalancing

Image courtesy of https://fee.org/articles/the-law-of-supply-and-demand/

Expect the price of $PGOLD to go up and expect the price of $SECB to go down.

This is because fund managers who track the MSCI as its benchmark and mimic MSCI's basket of stocks will have to remove $SECB in their portfolio by selling $SECB, thereby driving the stock price of $SECB down. Supply up + demand down -> Prices down.

On the other hand, fund managers will update their portfolio by buying $PGOLD thereby driving the stock price of $PGOLD up. Demand up + supply down -> Prices up.

The Law of Supply and Demand in play! 

$PGOLD is expected to go up

When the news broke out that $SECB will be removed, its stock price immediately went down. 
You could see a gap.

[Note: This post may need prior knowledge on what happened in MSCI rebalancing. You may read it @ https://business.inquirer.net/297215/psei-loses-0-45-in-thin-trade]

SOUND BOARD: Effects of ABS-CBN shutdown on other businesses

[This is raw]

70 Congressmen killed the franchise of ABS-CBN, the Philippines' largest network, because of their own personal vendetta against ABS-CBN. They put their personal interest first, ahead of  the interest of the Filipino people, their constituents. 

Instead of helping each and every Filipino and business to survive the crisis brought by COVID-19, the Congressmen chose to put an end to ABS-CBN's franchise at the expense of a lot of employees and other businesses. 

Effects:

- 11,000 people lost their jobs.

- Advertising companies lost their clients after losing half of the audience in TV market. See https://business.inquirer.net/296787/ad-companies-feel-impact-of-network-shutdown

- Investors lost confidence in the Philippines, seeing how the government can adversely affect the operations of businesses without regard to due process of law. See https://www.bworldonline.com/forced-closure-of-abs-cbn-may-hurt-investor-confidence/

- Domino Effect on other industries rendering services to ABS-CBN. See 

https://www.rappler.com/voices/thought-leaders/analysis-how-abs-cbn-exit-will-hurt-philippine-economy

- Research firm lost biggest client, ABS-CBN. See https://business.inquirer.net/306434/abs-cbn-shutdown-aftermath-research-firm-ad-agencies-also-cutting-jobs

- Less exposure of sports events. See https://cnnphilippines.com/sports/2020/7/17/ABS-CBN-Sports-retrenchment.html?fbclid=IwAR3Geb4kl6m-OyTIk8aFzmXM0V_Uj63X3xdezK-XtQLdc5XdzWfPUarGIWA

Given the adverse effects of the ABS-CBN shutdown to a lot of people, I can't help but think if the 70 Congressmen have conscience. 

This is indeed a very very sad episode in the history of the Philippines. 😞😢😟