GDP Up but Fails to Stir Up the Market

Despite the First Quarter 2013 GDP report that grows with 7.8%, ahead of estimates, the market still fails to recover from it’s lost that started last week.


If you are like me who does not really understood what GDP means, except that I know it’s a country’s economic growth calculation, I have researched the meaning from as follow:

What is GDP?

The gross domestic product (GDP) is one the primary indicators used to gauge the health of a country’s economy. It represents the total dollar value of all goods and services produced over a specific time period – you can think of it as the size of the economy. Usually, GDP is expressed as a comparison to the previous quarter or year. For example, if the year-to-year GDP is up 3%, this is thought to mean that the economy has grown by 3% over the last year.

The market continues to goes down as of this writing. Nobody really knows until when will be this Philippine bullish market will end and bounce back.

As a long term investor, don’t panic. I still believe that it is just a market correction and still not a market crash.

Did you remember that the market started the year at 5,860.99 which is actually a record high on that time, and market closed today at 6953.35 which is 18.63% higher than it’s opening price also known as YTD.

The percent gain or loss that the portfolio has achieved over the Year To Date (YTD) period. Refer to the “as of” date to determine the exact period.

Since I am in the stock market for almost 1.5 years, I don’t have this problem of panic, I know it’s just part of the market cycle.

For investors, this is really a good time to buy since the market is down and there is really a good chance that the market will bounce soon. Investors have 2 option if they have money to buy more stocks.

1.)   Buy on stages ( aka Peso Cost Averaging)

2.)   Buy until the market is on it’s lowest price.

Number 1, is easier because you will be doing cost averaging. On number 2, nobody really knows when it will be up or until when it will be bullish. Yes there is Technical Analysis, but when the market is affected by outside force, nobody knows what might happen.

I have read a news about “BASE III” but I still need to understand the effect of this to Philippine Economy or I can say Global Economy. Read More about BASE III here and here

For research purpose, I have copied some information in the net about this article:

What is BASE III

“Basel III” is a comprehensive set of reform measures, developed by the Basel Committee on Banking Supervision, to strengthen the regulation, supervision and risk management of the banking sector. These measures aim to:

  • improve the banking sector’s ability to absorb shocks arising from financial and economic stress, whatever the source
  • improve risk management and governance
  • strengthen banks’ transparency and disclosures.

The reforms target:

  • bank-level, or microprudential, regulation, which will help raise the resilience of individual banking institutions to periods of stress.
  • macroprudential, system wide risks that can build up across the banking sector as well as the procyclical amplification of these risks over time.

What is BIS?

As shown in Wikipedia:

The Bank for International Settlements (BIS) is an international organization of central banks which “fosters international monetary and financial cooperation and serves as a bank for central banks”.[2] As an international institution, it is not accountable to any single national government.

The BIS carries out its work through subcommittees, the secretariats it hosts and through an annual general meeting of all member banks. It also provides banking services, but only to central banks and other international organizations. It is based in Basel, Switzerland, with representative offices in Hong Kong and Mexico City

All I can say is that stay with your plan, if you cannot handle the loss then make a cut loss, and if not just close your online broker account and watch some movie. Do some research. For long term investor, like those people in Equity Mutual Fund, relax and wait for the rebound.

Always remember the Higher the Risk the higher the possible Returns, The Lower the Risk the Lower the possible returns. So it’s up to you on which investment path will you go.

The best thing to do is to study first. Remember that you don’t have to be emotional when it comes to stock market movement.

For OFW, Our exchange rate today is Php 42.36 : 1 USD, good for us.

Happy to report that after the closing today I still have 19.5% Gain YTD.

Philippine Stock Exchange On Sale Today Due to Japan

Forums and different Facebook groups became busy today, checking on what happen in the stock market. Some ask if this is the start of the long correction. Or is there any other Coup D’ Etat in place, or even is there any mutiny who would like to overpower the President and more. The real story is shown below.

Asian stocks had been affected as Japanese NIKKEI 225 shares fall today at 7.32% down. Reports says that Japan’s trading was halted today.Today’s market halt happened in Japan last March 15, 2011, in the immediate aftermath of Japan’s earthquake, tsunami and nuclear disaster.

 Nikkei 225 May 23

The Philippine stock market has been affected by this fall as more investors goes profit taking in fear of continues fall of the stock market, However the market recovered immediately after few minutes of panic, we saw investor buying at low price. The Philippines Day Range is: 7,218.34 – 7,388.39. It only shows that more and more investors believe that it is more fun investing in Philippines.

Philippine stocks Exchange May 23

Actually this is the best time for those with extra amount in their account. In time like this it will be best to buy at low and take profit later on.

On the other hand, SMPH holding investors felt different today, SMPH close at 2.90 per share gaining a 2.90% increase on its share after breaking it’s support at 2.7.

Here is some notable decliners today in the Philippine Stock Market

  • Asia United Bank Corporation (AUB) -4.61%
  • First Gen Corp (FGEN)       -3.35%
  • Energy Development Corp (EDC)            -3.28%
  • Universal Robina Corp (URC)      -3.10%
  • Belle Corp (BEL)      -2.69%
  • Metropolitan Bank & Trust COM (MBT) -2.54%
  • Bloomberry Resorts Corp (Bloom)            -1.54%

Will the Market Recover?

Well nobody knows, I am not an expert to say but really nobody knows what will happen in the stock market. Yes, there is Technical Analysis (TA) and Fundamental Analysis (FA) but those are just analysis but nobody can foretell the future.

All I can say is that if you are a long term investor and if you do cost averaging, now is the best time to buy in the market. There are lots of opportunity now compared the last few days.

Knowing the Philippine market stability, we are for a long haul in the stock market, I believed that we are still in a bullish market.

Congrats to those who bought some position during the Market sale today. Anyway if you are in the market for a long term, you don’t have to bother yourself about this news and just increase your position. Happy Investing and it’s really more fun investing in the Philippines.

Some related news from Bloomberg here

Cost of Ignorance vs Financial Literacy

They say that Financial Literacy Seminar and Financial Investment is too expensive for people to start and I say it is more expensive to be ignorant than to get Investment portfolio such as Insurance , Mutual Funds and other investment.

Let me explain my point.

Most people when asked about their savings and investment, they will just reply, “I don’t have investment, it is only for the rich”. It is the reason why our society needs to be educated about financial literacy.


Saudi OFW who goes back to Philippine with Final exit normally gets End of Service Benefits (ESB) from his employer. This is worth 50% of his/her monthly salary per year for the first 5 years and 100% of monthly salary for the next year of the total service rendered. The problem; whenever an ofw goes to Philippines without any financial literacy, chances are this money will only last for few months and end up being poor while in Philippines. It is also the reason why many old aged ex Saudi want to go back to Saudi to work again.

I can give you an example, let say an OFW earns 5,000 riyals per month (assuming it is his latest salary), and he stayed on his company for 15 years. This will be his computation:

  • First Step : 5,000 x 0.5 x 5 years = 12,500
  • Second Step : 5,000 x 1 x (15-5) years = 50,000
  • Total take home = SAR 62,500 = approx. Php 675,000

Imagine working for 15 years in Saudi Arabia who have no knowledge in Philippine Business, put his ESB in business and ended up of becoming bank craft.

Financial Literate OFW will definitely think of something on how he can grow his money, taking into consideration different risk that he will face on his venture on investment while,

An OFW without any Financial Literacy Background will definitely spend 10% or more for “Pasalubong”, then after arriving in Philippines “Painom” and more. This is just to tell everybody that he came back from overseas work. His friends will approach him to open a business and gives his money with no proper feasibility study. So what do you think will happen to this OFW? Will he enjoy his retirement?

Financial Literacy is important for all of us. Ignorance is the most expensive things in the earth as well as ignorance can also be equated to gambling. Any business without proper study will have high chances of business failure.

Learning Financial Literacy does not mean you don’t have faith in the Lord. Financial Literacy is preparing for your future and having faith that the Lord will help and guide you in your plan.

I always believe in If You Fail to Plan, You Plan to Fail.

Proverbs 22:3 ESV

The prudent sees danger and hides himself, but the simple go on and suffer for it.

Be wise on your hard earned money.

Suze Orman advises Filipinos to invest in Philippines

Suze Orman, American author, financial advisor, motivational speaker, and television host, in the United States advises Filipino to invest in the Philippines. She firmly believe in Philippine economy and she even suggest investing through mutual funds. It was also mentioned in the interview that one should not be engage in Credit Card debt bondage, and if ever engage with it you need to get out as soon as possible. She also discuss the importance of having an emergence fund and then investing after reaching the goal of having an emergency fund.

ABS CBN even twitted quoting Suze Orman that she will invest in Philippines.

suze orman

Meanwhile, Philippine Stock Index have again reach an all-time high at 7392.20, today.

You may see the interview of Suze Orman in the embedded YouTube video below.

PH Stock Index All Time High at 7,313.46 breaches 7,300 for first time in history


PH Stock Index All Time High at 7,313.46 breaches 7,300 for first time in history

Once again PSEi set a record of an all-time high at 7,313.460 a day after the election. It only means that investors have trust on the recently concluded election. In addition a new intra-day high was likewise hit at 7,349.95. It is 30th record breakout for the year and the 91st under the Aquino administration.

This sign is really good for investors because they could see gains from their investment. People who are not yet investing will not really feel the effect of the economy.

I believe that it’s high time for people to go to Investment. If you don’t know how to read graphs, and if you do not understand how the stock market works, I believe that is now high time to learn about this things. If you want to start you can go to banks or Mutual Fund Company and ask about equity funds.

Equity funds performance depends on the stock market movement. Just make sure that you know the risk that you will face in going to stock market.

Investing in stock market could give you a really high profit but likewise it could also give you a very high lost. The higher the Risk the Higher the possible gain and the lower the Risk the lower possible gains.

Your investing appetite will determine the type of investment that you will push through.

If you invest in equity funds, you will not bother about fundamental analysis and technical analysis of a certain stocks. But likewise you will not also have any part in decision making about which stocks to pick or to sell.

The beauty in stock market is that you control your investment but if you do not know this things better go to equity funds then learn about stock market.

Happy investing and I hope that many OFW will start investing and not just waster their money in gadgets and useless wants.

IMG Now Offers Philam Term Life Insurance for Members

Good news for IMG (International marketing Group) members who believes in BTID, IMG now offers Philam Term Life Insurance exclusive for IMG members at an affordable price. Just recently Philam conduct a seminar at IMG office in Manila. I have also been informed that this policy gives triple A protection (Anywhere, Anytime and Any Cause of Death).

About Philam Life

Philam Life is the largest life insurance company in the Philippines and the market leader for over 65 years now.

Philam Life ranks first among life insurance companies in the Philippines in terms of;

  • Assets
  • Investments
  • Net Income
  • Net Worth
  • Paid-up Capital*

Philam Life is a member of the AIA Group Limited, the largest independent publicly listed pan-Asian life insurance group in the world.

The AIA Group Limited has wholly-owned main operating subsidiaries or branches in 16 markets in Asia Pacific – Hong Kong, Thailand, Singapore, Malaysia, China, Korea, Philippines, Australia, Indonesia, Taiwan, Vietnam, New Zealand, Macau, Brunei and Sri Lanka and a 26 per cent joint venture shareholding in India.

AIA Group Limited is listed on the Hong Kong Stock Exchange.

What is BTID

Upon reading about different investment article, I believe by now you have encountered the word BTID. BTID means, Buy Term and Invest the difference. This is a common philosophy in investing as opposed to getting whole life insurance or VUL.

What is Term Life Insurance?

According to

A policy with a set duration limit on the coverage period. Once the policy is expired, it is up to the policy owner to decide whether to renew the term life insurance policy or to let the coverage end. This type of insurance policy contrasts with permanent life insurance, in which duration extends until the policy owner reaches 100 years of age (i.e. death).

These types of policies provide a stated benefit upon the death of the policy owner, provided that the death occurs within a specific time period. However, the policy does not provide any returns beyond the stated benefit, unlike permanent life insurance policies, which have a savings component that can be used for wealth accumulation.

As an example if you buy a term life insurance that covers from January 30, 2012 with a Php 1,000,000 insurance coverage,  you will then be protected by insurance for a year up until to January 29, 2013. After those dates what you have paid will not be recovered since it’s a payment for your protection for that year.


  • All bonafide members of IMG;
  • Actively performing the normal chores of life;
  • Ages 18 – 64, renewable up to age 70

What are the Benefits?

  1. Group Yearly Renewable Term Insurance (GYRT)
  2. Accidental Death, Dismemberment & Disablement Benefit (ADD&D) rider
  3. Terminal Illness Benefit (TIB) rider

OPTIONAL RIDER: Critical Illness Benefit (CIB)

How much is the Policy?

The rates provided by Philam to IMG is really affordable, as an example at the age of 36 years old, I only need to pay Php 3,630 for basic insurance + Php 2,900 for Critical Illness Benefits (CIB) with a total of Php 6,530 (This is only for this year, It will be adjusted as I increase my age). There is an insurance package up until 70 years old.

But again, this offer is only applicable to existing IMG member. If you want to be a member and you want to know more about IMG you may fill up your details below and I would be happy to give you more details about the company.


AXA and Metrobank Card launch MSwipe

Today, AXA Philippines and Metrobank  launches MSwipe, the country’s first mobile insurance payment system. MSwipe allows AXA customers to make real-time credit card payment transactions using mobile devices such as smartphones or tablet devices, giving them an innovative, convenient and secure means of paying their life insurance premiums anytime, anywhere according to a report made by GMA Network.


Photo Credit: AXA Philippines

This new innovation called, MSwipe will enable AXA financial advisors to use their registered smartphones and tablets to receive credit card payments for their customers’ premiums.

A good news for AXA customers since they will not need to carry cash or checkbooks in paying. But credit card users, needs to make sure that they will have to pay their credit card payment on time or else, this system will make them into debt if not handled properly.

It always good to have a new technology but users need to be aware on how to use it properly.