Joberlyn B.

Del Socorro
3 FM – 4
Prof. Kathleen Virly G. Lao
(Capital Market) MW 5:30 – 7:00 PM

Module 7 Assignment

1. Choose 3 out of 10 Money market fund in the Philippines below and compare
each of the funds.

BDO PESO MONEY MARKET FUND

The money market fund like BDO is suitable for individual and corporate
investors with moderate risk appetite and who are looking for safe and liquid
investments with yields relatively higher than those of savings and time deposit
accounts. In order to minimize risks and maximize earning potential,
participants/trustors are recommended to stay invested in the Fund for at least six (6)
months. Subject to BSP guidelines and the Trustee's Trust Committee approval, the
Fund may also avail itself of financial derivative instruments solely for the purpose of
hedging risk exposures, as well as invest in other tradable outlets/categories as may be
deemed suitable for the Fund.

PNB PRIME PESO MONEY MARKET FUND

The PNB Prime Peso/Dollar Money Market Funds (MMF) are invested in a
diversified portfolio of bank deposits and fixed income instruments issued by the
Philippine government with a maximum weighted average duration of one year. These
funds are best suited for conservative clients. The PNB Institutional Money Market Fund
was specifically created to meet the investment needs of institutional investors. It is
invested in a portfolio of bank deposits with a maximum weighted average duration of
one year. The fund is best suited for conservative clients. The PNB Peso Fixed Income
Fund is a peso money market fund invested in a diversified portfolio of bank deposit and
securities issued by the National government. The fund is suited for conservative
clients.

CHINA BANK MONEY MARKET FUND

A money market fund, like China Bank Money Market Fund, China Bank Short-
Term Fund, China Bank Cash Fund, and China Bank Dollar Money Market Fund is
principally invested in short-term deposits and fixed-income securities with portfolio
duration of one year or less, with the objective of preserving capital and generating
income from low-risk investments.

 Suitable for investors with “conservative to moderate” risk profile

 Expected return is higher than savings accounts or time deposits, but
lower compared to other types of UITFs, e.g., bond or equity funds.

One of the bank’s core strengths is its Unit Investment Trust Fund (UITF)
programs, which are tailored to suit the financial capacity and preferences of those who
want to invest their hard-earned money. According to China Bank, their Trust and Asset
Management Group offers an array of UITFs that meet the varying needs and
objectives of the Filipino investors. The bank has nine UITF variants of which three are
in the Money Market, three are in the Bond, and three are in the Equity fund categories.

2. Out of your 3 selected funds (in No.1), given a chance in the future, where will
you invest and why.

Among the 3 selected funds that I choose, I would like to invest in China Bank
Money Market Fund because they provide clients with a “moderate” risk profile a high
level of liquidity and at the same time better earnings potential than those offered by
regular savings/current accounts and other short-term deposit arrangements. China
Bank is very affordable because I gain access to high-grade investment securities at a
low minimum investment amount of P5, 000. It has potential higher returns; I enjoy
better returns, especially if I stay invested for at least one year. Liquidity, I have the
option to redeem my investment any time after the lapse of the minimum holding
period. Lastly, they have a professional fund management, a highly skilled and
experienced fund managers invests in various types of securities with the aim of
maximizing returns within reasonable risk levels, and diligently monitors market
developments to take advantage of opportunistic buying and selling.