Ano ang investment options na para sayo?

The four main asset classes

Equities and stocks

• Best for: Aggressive long-term investors
• Investment time frame: 5 or more years
• Initial investment cost: P50

Equities are investments that deal with company stocks. Stocks are high-risk dahil pabago-bago at unpredictable ang kanilang value. You can lose some or all of your investment sa stocks from companies that perform badly. But, if these companies grow over time, tataas rin ang kanilang value. You profit by selling your stocks habang mataas ang value.

If you invest in an equity fund, your fund manager will buy stocks from companies in the Philippine Stock Exchange (PSE). An example is ATRAM Philippine Equity Smart Index Fund. May equity funds din such as ATRAM Global Consumer Trends Feeder Fund na nag-i-invest in US stocks. Their stocks include Amazon, Alibaba, and Netflix.

Most equity investments mature in a span of five years and longer. While stock values change daily, most blue-chip companies generally perform well over several years. They survive and even thrive through economic hardship. In addition, inaabot din ng ilang taon ang stock markets to recover from financial crises tulad ng pandemic.

Fixed-income

• Best for: Moderate short-term investors
• Investment time frame: 1-3 years
• Initial investment cost: P50

The fixed-income asset class are made up of investments that involve bonds and debts. Kapag nag-invest ka sa bond fund, your fund manager will buy bonds. These can be from the local government and private companies. For instance, ATRAM Total Return Peso Bond Fund is mostly composed of government bonds. Once the investment reaches maturity, bond issuers pay back the fund. Most bond funds mature in one to three years.

Para kumita ang investment, magbabayad ang bond issuer ng interest rate monthly or quarterly. Kaya ito tinatawag na ‘fixed-income’. Bond funds are low-risk and stable dahil may repayment ka ng iyong capital upon maturity. In the long run, however, they are low-income investment options dahil debt interest lang ang iyong income.

Money Market and Cash

• Best for: Conservative short-term investors
• Investment time frame: 1 year or less
• Initial investment cost: P50

Nagpautang ka na ba and noticed na mas mahirap maningil the longer time goes by? The same is true of lending money to large institutions. The more time passes by, the more risk na hindi sila magbabayad. It’s the reason why governments at businesses offer short-term securities. Compared to bonds, short-term securities must be paid back quickly.

Conservative investors like short-term securities dahil sa quick maturity at low risk. In a year or less, mababawi nila agad ang investment. Mabilis din itong i-convert to cash. Hence, they’re also called liquid investments.

The market where short-term investment options are traded is called the money market. If you invest in a money market fund, bibili ang iyong fund manager ng short-term securities. Para kumita ang investment, ang securities issuer ay magbabayad ng interest rate. However, mabilis ang maturity ng fund — usually months to a year — kaya’t maliit din ang kikitain mong interest. ATRAM Peso Money Market Fund is an example of this fund.

Real estate and fixed assets

• Best for: Long-term investors with large capital

This is the asset class that we know straightaway. Fixed assets are tangible: you can literally see and touch them. Examples are house and lots, land, vehicles, livestock, furniture, heavy equipment and machinery, or gold. Overall, hindi bumababa ang value nila kahit tumaas ang inflation o maghirap ang economy. Still, kailangan mo ng malaking capital or a long payment period to acquire these investments. These assets are also harder to convert into cash.