Image via WikipediaFinancial IQ Philippines Quick Hit(s):
Risks are inherent on these investment instruments, not just stocks or Equity Mutual Funds. Treasury bills (T-bills) and Bonds are backed and with guaranteed interest. Contrary to majority, risks are still present on these instruments when bank interest goes up... demand for T-bills and bonds would go down.
How are t-bills, stocks, bonds & managed funds for investments?
Your columns are interesting. I’m in marketing work with a pharmaceutical firm. I appreciate your informative series on life insurance and savings, but since you said we readers could ask personal finance questions, could you ask Insular Life if they also sell bonds or have mutual funds? Is it a good time for people to invest their income in Philippine stocks now? What about T-bills? Kindly explain these options and help assess them.
Sonny Go, Jr., 31 years old, single, Pfizer
Answer
As somebody involved in the pharmaceutical industry, I am sure you are aware of the medical profession’s ethical code of not prescribing any medication/treatment without the proper diagnosis. The practice of financial advisory also adheres to the same standard; to answer your question as to where would be the best investment option today, it would be essential to first articulate your financial goals in terms of 1) how much is required to fulfill it and 2) when these goals would happen. Your answer to these two questions would provide you with a general guideline as to which option is most appropriate in helping you achieve your financial goals.
For goals that are five years or less, your best option would still be the bank products that we are all very familiar with like time deposits and special savings. For financial goals that are at least five years into the future but less than 10 years, you may want to consider a managed fund that invests in T-bills/bonds (Insular Life’s peso or dollar Fixed Income Fund). For 10 to 15-year goals a balanced fund may be your best choice (Insular Life’s Balanced Fund). And for financial goals that are at least 15 years into the future, an equity fund (Insular Life’s Equity Fund) should be the most appropriate.
Is it a good time to invest in the stock market? My answer: Every day is a great day to invest for as long as you are investing to fund an articulated financial goal.
http://www.philstar.com/Article.aspx?articleId=640798&publicationSubCategoryId=82
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