THE Sun Life Asset Management Co. Inc. (Slamci) reported assets under management (AUM) having exceeded the revised P75-billion target for the year amounting to P84 billion.
Slamci President and CEO Valerie N. Pama told the BusinessMirror the company had already breached its AUM target of P53 billion for 2017 within the first four months of the year.
That’s why the company had to revise its target AUM for the whole year, Pama said.
She said one of the drivers for the growth in Slamci’s AUM was the money-market fund, wherein investors continue to show preference in the instrument. Market appetite was also seen in terms of the firm’s Sun Life Prosperity World Voyager fund and the Dollar Wellspring fund.
Documents provided by Pama explained that the Sun Life Prosperity Money Market fund invests in special savings accounts. While the instrument presents the least of risk among all funds, it also yields the lowest possible returns. On the other hand, the Prosperity World Voyager fund gives investors access to global equities to help them grow and diversify their portfolios.
Slamci’s Prosperity Dollar Wellspring fund was designed to generate a regular stream of income and capital growth, providing potentially higher yields for a US-dollar investment as opposed to traditional accounts in financial institutions like banks.
Campaign
WHILE Slamci posted an AUM of only P48 billion last year, the company maintains its position as the largest nonbank asset-management firm in the country.
Earlier this year Slamci said it has more or less 131,000 clients nationwide via 11 funds that cater to investors with different appetites.
Pama said they are just awaiting regulatory so they can finally launch a new investment offering. They were expecting a go-ahead by the Securities and Exchange Commission (SEC) in July.
“We’re launching a dollar-denominated fund,” she said. “We’re just waiting for SEC approval.”
While waiting for the SEC, Slamci continued a campaign to encourage more Filipinos to invest. Pama said the campaign is in line with the goal of the Philippine Investment Funds Association (Pifa), of which Slamci is a member.
With its membership of 12 mutual fund companies and 58 member funds, the Pifa recorded total AUMs amounting to P276 billion as of July, keeping with its thrust to foster the growth of the country’s mutual-fund industry.
For 2016 the AUM of the Pifa had only reached around P245 billion.
Encouragement
ACCORDING to Pifa President Ferdinand L. Berba, less than 1 percent of the Philippine population invests their money.
That is why the Pifa wants to help increase financial literacy of the Filipinos to help them grow their money, according to Berba.
“Today, while we still have not really penetrated wide segments of the population, total AUMs of the different mutual-fund companies as of July is about P276 billion already,” Berba said at the sidelines of the Pifa 2017 Annual Mutual Fund Awareness Conference at the Asian Institute of Management in Makati City over the weekend. “It’s gone up steadily over the past years. But, of course, we want to grow it.”
He added that mutual-fund companies make use of an index fund because it sees the Philippine economy growing in the next five to 10 years.
“We’d like to look at mutual funds as the new bank for the Philippines,” Berba said. “Today, unlike in the past, there is more opportunity for everyone.”
Segments
IN the same forum, Pifa Chairman Ignacio B. Gimenez said an estimated 50 percent of the US population has made investments. Around 33 percent of Singapore’s population did so while the Philippines only has less than 1 percent of its population investing. To date, there are about 350,000 investors of the total Philippine population of 100 million.
“Nanghihinayang ako [I’m regretful] because all of us should at least be financially independent,” Gimenez added. “It’s so simple: first, pay your debt then save and then, the most important thing, invest.”
He said the market class that should be further encouraged to invest is people in the market segments belonging to the C and D brackets, as these are comprised of the middle class that needs to save and invest.
According to Pifa documents, while the C and D markets as a whole is not yet part of the investing population, individuals who comprise these segments are the ones who need it.
“We need to make a very big middle class in the Philippines. [But] it’s not going to be easy to build a big middle class on savings—it has to be in investments,” Gimenez said. “The best investment so far, in all my studies, is the stock market.”
Future
GIMENEZ said the Pifa is expecting to see at least three companies to join the association this year. However, they want the companies to want to apply for membership instead of only being persuaded to join.
Companies who would want to join the association must go through regulatory scrutiny by the SEC. They would also have to get a certification of approval by the Pifa that each has maintained good housekeeping.
“Of course, we’d like to break the P300-billion mark as soon as possible, and more,” Berba said.
Mutual funds are a pool of funds coming from a number of investors, which is used to invest in different securities to help the money grow. It is an investment program funded by shareholders that trades in diversified holdings and is professionally managed.
“The first important thing is at least open that account already and start; don’t get scared,” Pama said. “And there are so many different instruments to choose from and many different fund managers.”
Slamci Territory Head for Agency Sales June L. Book pointed out that time is on the side of the Philippine economy in terms of investments, since the average age of the population is only 23.
This translates to a labor force that will sustain the growth of the economy in the future, Book added.