FINANCIAL experts recommend maintaining a diversified portfolio to protect and grow one’s wealth, especially in today’s volatile environment.
Andrew Caw, ATR Asset Management Inc.’s managing director and chief marketing officer, advised first-time investors to avoid putting their hard-earned money into a single investment instrument.
He said that by investing in a mix of assets, investors can safeguard their money from significant losses. If one investment performs poorly, the impact on the overall portfolio is minimized because other investments may perform well.
“When you say investments, you don’t put everything there. The only way to reduce risk is by having a diversified portfolio,” said Caw, in a media briefing on July 12, 2024.
“Don’t worry about if it’s the right time to invest… Focus on what those products that you’d like to be investing in,” Caw added.
First Metro Securities Brokerage Corp. (FirstMetroSec) brought Caw and three other financial experts—Imelda Estrada, vice president and VisMin branch head of First Metro Asset Management Inc.; Dominic Yatco, vice president and head of institutional business of BPI Wealth; and Zed Matubis, vice president and head of wealth sales of Manulife Investment Management and Trust Corp.— to Cebu to discuss the various financial opportunities available in the market through FundsMart.
FundsMart is an investment funds supermarket that empowers one to invest in the country’s top peso-and dollar-denominated mutual funds and Unit Investment Trust Funds (UITFs). It gives the public over 130 mutual funds and UITFs to invest in from the country’s leading investment providers.
Matubis said now is the best time to invest. He advocates for portfolio investing over single-fund investing, noting that a well-diversified portfolio can capture gains from various investments, some of which may outperform others.
“The minimum (requirement) is so low anyway. You can actually do it and you should be investing regardless of market cycles,” he said.
One can already invest for as low as P1,000.
Matubis explained that investing is essential to prepare for the future, especially in light of inflation.
“Inflation is always going to be there and if you’re doing nothing, if you’re just saving and not investing, you’re basically hurting yourself because your future ability to spend money will be hurt by inflation,” he said.
Yatco added that it also helps to know one’s risk appetite and purpose before investing but taking a diverse portfolio approach is key to managing risks.
“You have to be clear with your financial goals added,” Estrada added.
She urged first-time investors to map out their financial plans and goals to determine which type of investment tool is ideal for achieving them.
Outlook
Asked about the market outlook, Matubis said there is a potential slowdown in global economic activity because of the existing high interest rate environment, and a moderating but sticky inflation.
“But inflation is slowly going down, which is good news, but it is still too slow for comfort but the opportunities are also there,” he said. “We are all expecting rate cuts by the central bank and this paves the way for lower interest rates for the future and also increased economic activity and consumption for people which translates to success in the market.”
Caw added that for long-term investors, market volatilities are less of a concern, as opportunities can still emerge even during downturns. Market volatility often presents opportunities to buy quality assets at lower prices and benefit from potential future gains.
“There is so much happening right now, the tensions in the West Philippine Sea, the upcoming US Elections, among others. Opportunities and risks will always be there,” he said.
Caw said that investing even during volatile times can position investors to benefit from the eventual market recovery and long-term growth.
Financial literacy
Andoy Beltran, vice president and business development and market education head for FirstMetroSec, said that the FundsMart roadshow in Cebu aims to promote financial literacy among Filipinos and lure them to invest in the country’s healthy economic growth story.
“Recognizing the limited access to diverse and sound investment instruments for many Filipino investors, FirstMetroSec, through FundsMart emerged as a response to address this critical gap. There is a prevailing belief that investing is exclusive only for the rich and we sought to change this narrative through FundsMart,” he said.
“We are making it a mission to empower every investor regardless of his financial experience, regardless of his financial knowledge and regardless of budget by providing the right tools and resources to shape his financial journey.”
FundsMart currently has 31,000 customers, a huge jump from the 1,400 count in 2016. / KOC