INVESTING FOR THE FUTURE

• When Is the best time to invest?

  As soon as possible.
• General Types of Investments that Attract Investors

  BSGIRLT

  Bank Products

  Stocks and Bonds

  Government Funds

  Investment Funds

  Real Estate

  Life Investments

  Tangible Assets
• Remember that investment not only takes money. It takes time as well. Delaying plans to invest is precious time going down the drain. But that doesn’t necessarily mean diving in right away. It still takes some research and planning to fully commit to chosen investments
• Bank Products - These are the most common type of investments there is. One basically deposits a sum of money and it will be held securely and limits withdrawal.
• 2 count as bank products

  Savings Accounts, Certificates of Deposit (CDs)
• Stocks are units of ownership in a corporation. To put it simply, when one buys stock from a certain corporation, he technically “owns” part of the company. Depending on the type of stock or “equity” purchased, some other perks come with it such as being part of the decision-making of the company. The higher the amount invested, the more power one has over it.
• T OR F

  The higher the amount invested, the more power one has over it.

  T
• units of ownership in a corporation

  Stocks
• Aside from dividends, another way to profit from an equity investment is through capital gains or capital appreciation.
• Capital gains (or loss) is simply the difference between the price at which a security is sold and the price at which it was originally purchased.
• T or F

  If an equity investment has been actually sold but has increased in price or value over its original cost, such increase is called capital appreciation.

  F
• The difference between the market value and the cost is also referred to as

  unrealized gain (or loss) or paper profits.
• T or F

  Stock is an easy form of investment. One should educate himself by attending trainings and seminars. But there are also online investment courses one can avail so that he can learn more about investing even at the comforts of his home.

  F
• Bonds are a lot more complex than stocks, mostly because they’re a lot tougher to comprehend.
• A bond is a debt security. Basically, if one buys a bond, he would be called a creditor.
• When corporations, agencies, organizations, and even the government need funding, they turn to _____.

  bonds
• So as a creditor, it would be as if they’d be borrowing money and return it with interest.
• As fixed income instruments, corporate bonds give fixed interest income for a specified number of years. The rate is usually higher than that offered by government securities or bank deposits.
• T or F

  Bonds come with risk. That means the lower the interest rate offered, the higher the risk as well that the company will default on payments.

  F
• If the company folds up, it may end up not paying its bond investors. Unlike bank deposits, bonds are not guaranteed by an insurance company like ____.

  PDIC
• These are relatively safe since they are guaranteed by the Philippine government.

  Government Securities
• provide steady and regular income every year.

  Government securities
• T or F

  Most of the government securities can be liquidated by selling to other investors or by selling back to banks that offered the product.

  T
• Examples of government securities

  Retail Treasury Bonds, Pag-ibig Housing Bonds, and Treasury Bills (T-Bills)
• Since the investment is guaranteed, the yield is minimal. Although higher than traditional savings and current accounts, interest earnings from government securities may still be lower as compared to other investments.
• This is the capital sourced from different investors.

  Investment Funds
• count as investment fund

  Mutual Funds and Unit Investment Trust Fund
• a type of investment where one joins other investors and corporations to form a massive fund which will be handled by an expert/professional who is called fund manager for diversified portfolios of stocks, bonds, securities, money markets and other mutual funds.

  Mutual Fund
• T or F

  In Mutual Funds, the investor buy shares of the investment company thus that makes him a shareholder and gives him shareholder’s right including voting power and opportunity to receive dividends.

  T
• In Mutual Fund, the investor buy shares of the investment company thus that makes him a shareholder and gives him shareholder’s right including voting power and opportunity to receive dividends.
• is also a type of investment where one joins other investors and entities to form a Trust Fund which will be handled by Trust expert/professional for diversified portfolios of stocks, bonds, securities, money markets and other funds.

  UITF
• In _____, the investor buys units of investment in the fund thus he will earn from the gain or loss resulting from the fund performance. Unlike MF, it won’t make him shareholder of the company.

  UITFs
• In UITFs, the investor buys units of investment in the fund thus he will earn from the gain or loss resulting from the fund performance. Unlike MF, it won’t make him shareholder of the company.
• T or F

  Both Mutual Fund and UITF are pooled and open-ended investments meaning they are pooled by different kinds of funds, people and companies to be invested and diversified to other investments like stocks, bonds, securities, money market and other mutual funds and trust funds. They are open-ended investments meaning one can buy or redeem anytime he wants


  T
• Both Mutual funds an UITFs are managed by fund managers who are already experts about investment fund growth, strategies and meeting target performance.
• T or F

  Only UITFs investments are risky in nature however they can give higher returns and can yield amazing money and capital growth.

  F
• Mutual Funds and UITFs usually offer the following types of funds and investments:

  • Money Market Funds –moderate risk; short term
  • Bond Funds – moderate risk; long term
  • Equity Funds – aggressive; long term
  • Balanced Funds – aggressive; long term
• T or F

  Both funds are insured by the PDIC because they are not deposit accounts

  F
• T or F

  In mutual fund, one can open an account by talking to a licensed mutual fund agent first so he’ll know the different types of MF available for him according to his risk tolerance (risk appetite), capacity to invest and his investment goal. In UITF one can open an account by talking to a trust representative of a bank. Banks usually have special representatives (not tellers) for Trust Investments and related products. If one can’t find one at the bank, talk to the bank manager. They will always be glad to assist


  T
• Mutual Funds are regulated by SEC (Securities and Exchange Commission) while UITFs – are regulated by the Bangko Sentral ng Pilipinas (BSP)