STOCKS AND BONDS

Stocks - Stocks, or shares, are units of equity

or ownership stake in a company.

Types of Stocks

Stocks by size: There are small,

medium, and large companies one
can invest in.
Stocks by sector: Those who care a
lot about information technology or
some other sector might want to
devote a percentage of their
investment
portfolio
to
such
companies.
Stocks by growth: Some stocks are
rapid growers and have the potential
to give a good return, but they can be
risky; these are growth stocks.
Stocks by region: It is possible to
invest in local and overseas markets.
Index funds: the entire index will
grow and produce a return, though
some stocks within the fund may
decrease in value.
Bonds - are simply loans made to an
organization. They are a form of debt and
appear as liabilities in the organization's
balance sheet.
Types of Bonds

Government bonds: Bondholders of

government bonds are loaning money
to a government..
Municipal bonds (a.k.a., "munis"):
Corporate bonds: are where
investors loan money to corporations.
They make for riskier investments
than government and municipal

bonds, but the potential returns are

much higher
Zero-coupon bonds (a.k.a., accrual
bonds): These bonds are often sold at
a discount and have a fixed interest
rate that only pays out upon bond
maturity.
Stocks and Bonds to Avoid

Penny/cent stocks: The U.S.

Securities and Exchange Commission
(SEC) defines a penny stock as
generally being "a security issued by
a very small company that trades at
less than $5 per share."

Junk bonds: This is the name given

to high-risk bonds from companies
(or governments) that receive lower
bond ratings and have a greater
chance of defaulting.
Insurance - An agreement in which a person
makes regular payments to a company and the
company promises to pay money if the person
is injured or dies, or to pay money equal to the
value of something (such as a house or car) if
it is damaged, lost, or stolen.
Types of Insurance:
1.) Health Insurance - Health insurance, also
called medical insurance, helps protect you
and your family from expensive or unexpected
health care-related expenses.
2.) Disability Insurance - also known as
disability income insurance, is another type of
medical coverage. It pays part of your income
if you become ill or injured and need an
extended period of time to recover or if you
can no longer work.
3.) Medicare - is a health insurance program
provided by the federal government to people
over the age of 65 or with certain health
conditions.

4.) Medic- aid - is another type of federal

health insurance, and it pays health care costs
for low-income citizens of all ages.
5.) Long-Term Care - helps cover costs
associated with care in a nursing home or other
similar facilities if you become unable to take
care of yourself.
6.) Life Insurance - The main purpose of life
insurance is to insure against loss of income
due to death and can also be used for
retirement planning and investing. It is the one
kind of insurance you pay for, but only others
benefit from it.
7.) Liability Insurance - protects you when
others claim to be hurt or injured as a result of
something you did or did not do. Generally, it
pays medical bills or provides compensation to
anyone who can prove you were negligent or
acted improperly.
8.) Homeowners Insurance - insurance
protects your investment against disasters such
as fire, tornadoes, busted pipes, robbery, and
other similar problems. Coverage in case
someone visiting your home is injured.
9.) Automobile Insurance - limits financial
loss due to damage or a car accident. If a tree
falls on your car or it is damaged by a hail
storm, your comprehensive insurance policy
covers your claim and helps offset the cost of
repairs.
Mutual Fund - Is a collection of stocks and/or
bonds. You can think of a mutual fund as a
company that brings together a group of
people and invests their money in stocks,
bonds, and other securities.
You can make money from a mutual fund in
three ways:
1. Income is earned from dividends on
stocks and interest on bonds.
2. If the fund sells securities that have
increased in price, the fund has a
capital gain. Most funds also pass on

3.

these gains to investors in a

distribution.
If fund holdings increase in price but
are not sold by the fund manager, the
fund's shares increase in price. You
can then sell your mutual fund shares
for a profit.

Advantages of Mutual Funds

1) Professional Management - The primary
advantage of funds is the professional
management of your money. Investors
purchase funds because they do not have the
time or the expertise to manage their own
portfolios.
2) Diversification - By owning shares in a
mutual fund instead of owning individual
stocks or bonds, your risk is spread out. The
idea behind diversification is to invest in a
large number of assets so that a loss in any
particular investment is minimized by gains in
others.
3) Liquidity - Just like an individual stock, a
mutual fund allows you to request that your
shares be converted into cash at any time.
Disadvantages of Mutual Funds
1) Professional Management - Many
investors debate whether or not the
professionals are any better than you at
picking stocks. Management is by no means
infallible, and, even if the fund loses money,
the manager still gets paid.
2) Taxes - When a fund manager sells a
security, a capital-gains tax is triggered.
Investors who are concerned about the impact
of taxes need to keep those concerns in mind
when investing in mutual funds.
3) Costs - Creating, distributing, and running a
mutual fund is an expensive proposition.
Everything from the manager's salary to the
investors' statements cost money. Those
expenses are passed on to the investors.

Different types of Funds

1) Money market funds - a safe place to park
your money. You won't get great returns, but
you won't have to worry about losing your
principal.
2) Bond/Income Funds - purpose is to
provide current income on a steady basis. The
primary objective of these funds is to provide a
steady cashflow to investors.
3) Balanced Funds - The objective of these
funds is to provide a balanced mixture of
safety, income and capital appreciation. The
strategy of balanced funds is to invest in a
combination of fixed income and equities.
4) Equity Funds - Funds that invest in stocks
represent the largest category of mutual funds.
Generally, the investment objective of this
class of funds is long-term capital growth with
some income.
5) Index Funds - This type of mutual fund
replicates the performance of a broad market
index. An investor in an index fund figures
that most managers can't beat the market.

INTELLECTUAL PROPERTY
INTELLECTUAL PROPERTY refers to
creations of the mind: inventions; literary and
artistic works; and symbols, names and images
used in commerce.
PROPERTIES:
Industrial Property
patents for inventions
trademarks
industrial designs
Geographical indications.
Copyright
literary works (such as novels, poems
and plays)

films, music, artistic works (e.g.,

drawings, paintings, photographs and
sculptures)
Architectural design.
Intellectual properties rights - allow
creators, or owners, of patents, trademarks or
copyrighted works to benefit from their own
work or investment in a creation.
PATENT - is an exclusive right granted for an
invention a product or process that provides
a new way of doing something, or that offers a
new technical solution to a problem.
- provides patent owners with protection for
their inventions. Protection is granted for a
limited period, generally 20 years.
Patent protection means an invention cannot
be commercially made, used, distributed or
sold without the patent owners consent.
Rights patent owners have

has the right to decide who may or

may not use the patented
invention for the period during which
it is protected.
may give permission to, or license,
other parties to use their inventions
on mutually agreed terms.
Owners may also sell their invention
rights to someone else, who then
becomes the new owner of the patent.
OFF PATENT - meaning the owner no longer
holds exclusive rights to the invention, and it
becomes available for commercial exploitation
by others.
KINDS OF INVENTIONS
PROTECTED

CAN

BE

It must be of practical use

It must show an element of novelty,

The invention must show an

inventive step that could not be
deduced by a person with average
knowledge of the technical field

Application of Patent
1.
2.

title of the invention

an indication of its technical field

TRADEMARK - is a distinctive sign that

identifies certain goods or services
produced or provided by an individual or a
company.
Trademark in the Philippines

Trademark applications are filed with

the Philippine Intellectual Property
Office (IPO).
1. Application form
2. Trademark specimen (attached to the
application from)
3. Special Power of Attorney (if the
application is being processed by a trademark
agent or representative. There is NO need for
notarization)
TRADEMARK APPLICATION FEES:
The government fee for a trademark
application in one (1) class for small
entities is One Thousand Eighty
Pesos (P1,080.00).
If the trademark has color, then an
additional Two Hundred Fifty Pesos
(P250.00) must be paid for each
class.
It must also be remembered that an
additional one percent (1%) is
assessed as legal research fund for the
government fees paid to the IPO.
NOTE: Pertinently, a small entity is one whose
assets do not exceed One Hundred Million
Pesos (P100,000,000.00).
Industrial Design - refers to the ornamental or

aesthetic aspects of an article. A design may

consist of:
Three-dimensional features
Shape
Surface of an article
Two-dimensional features
Patterns
Lines
Color

Industrial designs are applied to a

wide variety of industrial products
and handicrafts:
1.
2.
3.
4.
5.
6.

technical and medical instruments

watches, jewelry and other luxury
items
house wares and electrical appliances
vehicles and architectural structures
textile designs
leisure goods

GEOGRAPHICAL - indication is a sign used

on goods that have a specific geographical
origin and possess qualities or a reputation due
to that place of origin.
Copyright laws - grant authors, artists and
other creators protection for their literary
and artistic creations, generally referred to as
works.
A closely associated field is related rights
or rights related to copyright that
encompass rights similar or identical to
those of copyright, although sometimes more
Novels
limited
and of shorter duration.
Poems
Plays
Works
covered by copyright include, but
notReference
are
limited to:
Choreography,
Works
Paintings
Newspapers
Drawings
Advertisements
Photographs
Computer
Sculpture
Programs
Architecture
Databases
Maps
Films
Technical
Musical
Drawings
Compositions