Ayala-led Bank of the Philippine Islands has rolled out a new equity fund invested in a basket of high dividend-yielding companies, targeting investors with an “aggressive” risk profile and long-term investment horizon.
BPI Philippine High Dividend Equity Fund presents investors with a “new strategy that combines the ability to generate attractive returns from price appreciation of the underlying stocks, as well as, from regular dividends,” Maria Theresa Javier, BPI senior vice president and head of asset and trust management group, said in an e-mail to the Inquirer.
This is BPI’s latest unit investment trust fund (UITF), which was created last August but made available for public subscription only starting Oct. 1 for a minimum initial investment of P10,000.
“This being an equity fund, we recommend that clients take a long-term investment horizon to be able to weather market cycles and to maximize the earning potential of their funds,” said Javier, adding that the strategy of the fund would be most effective for investors with at least five years in investment horizon.
There are 16 companies that are part of the portfolio of BPI’s new fund. The two biggest components are PLDT and SM Investments with a share of 14.1 percent each. Both companies are likewise the most valuable companies in the local stock market.
Other companies in the portfolio and their respective weight in BPI’s new fund are Aboitiz Equity Ventures (6.9 percent), Universal Robina Corp. (6.4 percent), Manila Electric Co. (6.2 percent), Globe Telecom (6.2 percent), BPI (6.2 percent), BDO (6.2 percent), Aboitiz Power (6 percent), Semirara Mining (5.9 percent) and Manila Water (5.1 percent), SM Prime (4 percent), Robinsons Land (3.5 percent), GMA-7 (3.5 percent), Jollibee Foods Corp. (2.9 percent) and DMCI Holdings (2.8 percent).
“Stock selection in the fund, while primarily screened for dividend history and dividend payout ratios, will have growth considerations,” Javier said.
Elaborating on why this was a good time to offer the fund, Javier said “it helps provide an additional diversification (through a high dividend fund) to help maximize returns and minimize risks for portfolios with allocation across asset classes.”