BPI urges aggressive stock investments this year

The year ahead presents “perfect market conditions” for risk-taking, which makes investing in equity index funds an attractive option for investors who are looking for higher returns.

Thus said the head of the Bank of the Philippine Islands’ (BPI) asset management and trust unit as he urged clients to adopt a so-called “risk on” stance and dive into stock investments on the local bourse.

In a press briefing last week, BPI Asset Management and Trust Corporation president Mario Miranda also predicted the Philippine economy would perform even better in 2018, with a 7-percent growth rate potentially sustained through 2019 due to consumption and infrastructure spending, plus the upcoming local elections.

“[We] predict a 7.1-7.2 percent gross domestic product growth for 2018, and is optimistic that the Philippine Stock Exchange index could attain 10,000 in the next two years,” the bank official said.

He said the Philippines has manageable exposure to external vulnerabilities, spurred by the steady growth of remittances, having the highest loan growth in the region, along with the continued depreciation of the peso, and stronger private consumption that would drive the economy.

BPI’s asset management unit also pointed out the Tax Reform for Acceleration and Inclusion (Train) law would drive consumption higher and have a positive impact on the income of companies.

“Inflation risk is also still muted in 2018, and combined with the steady growth of the economy, these make for the perfect ingredients for risk-taking this year,” the BPI official also said.