Compare mutual fund fees: List of Philippine mutual funds

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When I started investing many years ago the first question I had was, where can I invest? I knew I wanted to begin with mutual funds because a friend told me about them. However, I hadn’t had the chance to get to know the companies that offer them.

If you find yourself asking the same question, this is the article for you.

Fees and charges of mutual funds in the Philippines

Mutual funds are great when you would want to invest your money and hope to enjoy potential gain. They are a great way to save particularly for financial goals that would take you some years to achieve.

However, you might also be interested to learn about the fees and charges. When you are getting started into mutual funds, you might forget that you are also paying the company for keeping your savings and optimizing your returns. These fees can actually eat into your expected profit.

In this article, you will learn about the fees that are usually charged to any account, understand their impact, and check how much each investment company charge. Similar funds are grouped together so that you can make fair comparisons. At the end, you will see a list of references to help you if you wish to research more.

Understanding mutual fund fees

Let’s revisit some of the details as discussed in beginner’s guide to mutual funds.

Initial investment

When you open a mutual fund, there is an initial investment that is required. It ranges between ₱50 and ₱5,000. This amount varies from one fund to another, so it pays to check ahead. Of course, you can go higher.

Minimum additional investment

After opening, you may want to add more. The minimum additional investment is between ₱50 and ₱1,000. It is actually a strategy called peso cost averaging to continue investing just a little each month. Some companies like ALFM, FAMI and Philequity allow you to do so automatically where your bank account gets debited at a particular date every month.

Front-end fee

The front-end fee, also called sales load, is taken off from your investments every time you open or add. Some companies waive the fee. Others have a tiered policy; the higher you invest, the lesser the fee becomes or even none at all. So let’s say you put up ₱5,000 to a fund with a front-end fee of 2%. What actually gets invested is ₱4,900.

  • Initial investment: ₱5,000
  • Front-end/Sales load: 2%
  • Sales load amount: ₱5,000 x 2% = ₱100
  • Actual invested amount: ₱5,000 – ₱100 = ₱4,900

Management fee

The management fee is the portion of your investment that goes to pay for the operation of the fund and other expenses. Don’t worry, you really don’t have to pay this personally ever year. This fee is taken out from the fund and reflected in the value of the fund called NAVPS. The higher the management fee, the lower is the NAVPS.

NAVPS

Which brings us to the next item, NAVPS or net asset value per share. It is the worth of the fund derived by adding up all its assets minus debts, and then the result is divided by all shares. You get earnings from the fund when its NAVPS increases as its investments grew.

Ownership

Since the fund is also a company, you as an investor are a shareholder. The number of shares you get depends on the the actual invested amount. So let’s assume that the NAVPS of a fund is ₱2 per share. Following the example above,

  • Actual invested amount: ₱4,900
  • NAVPS: ₱2 per share
  • Number of shares: ₱4,900 ÷ ₱2 = 2,450 shares

Effects of mutual fund fees

Fees are collected to keep the operation of the fund, pay compensation for advisors, pay brokerage fees, and other such expenses. Of course, you would want to get a fund with lower fees as they can actually affect the amount that gets invested and the profit that you get when you redeem your shares.

For instance, the sales load lessens the amount that would be used to invest. In turn, you would need to wait for the fund to grow to a level that would match the sales load to break even. Moreover, the higher management fee there is, the lower the NAVPS becomes and the lower returns you get.

To better illustrate this point, imagine that you have a mutual fund with 1%, 3% or 5% front-end fee. The fund requires ₱10,000 initial investment, and then you decide to re-invest ₱1,000 consistently every month. If we assume that the it grows 10% annually, then here’s the comparison between no fees and with the fee.

YearDepositZero fee1%3%5%
122,00023,67023,43422,96022,487
234,00038,76738,38037,60436,829
346,00055,44054,88653,77752,668
458,00073,85373,11471,63770,160
570,00094,18793,24691,36289,478
10130,000232,489230,165225,515220,865
15190,000459,697455,100445,906436,712
20250,000832,972824,642807,983791,323
25310,0001,446,2371,431,7751,402,8501,373,926
30370,0002,453,8192,429,2812,380,2052,331,128

As you can see from the table, the 2% fee charged every time that you put money can actually impact your return many years down the road. Think of the opportunity cost when we include the annual management fee into consideration.

Are fees really that baaad?

Actually, fees are what makes the ball rolling. Without them, there will be no investment companies that can sustain operation. Investors like you and me pay the fees in exchange for hiring somebody to do the analysis and trading of securities since maybe we don’t have the time, resources, or skills.

But why do others have higher fees? Companies can lower what they charge on passively managed investments such as index funds. Index funds simply follow the stock index (blue chips, the top 30 companies in the stock exchange). Others though require more work particularly those that strive to beat the returns of the blue chip stocks.

In saying that they are essential, it is also crucial to be able to smartly compare the fees of funds of the same type. The goal really is to keep fees, important as they are, to a minimum.

However, you may choose to go with the ones that have higher charges. It can be a strategy if you think that the fund, maybe because of the trust in the institutions that oversee it, can potentially give you superior returns to make up for them in the long run.

Types of mutual funds

Mutual funds can be grouped into investment objective. The investment objective describes what the fund is invested to, risks, and the profile of investors it is designed for. You may also want to know the bestperforming mutual funds in the Philippines in 2019.

In the Philippines, the types of funds available in the market are:

FundAssetRiskInvestor
Stock fundsStocksHighAggressive
Balanced funds Stocks and bonds Medium Between aggressive and conservative
Bond fundsBondsLowConservative
Money market fundsFixed incomeLowVery conservative

The list below is from the official document released by the Securities and Exchange Commission.

Index funds

Index funds are funds that try to mirror the growth story of a market, an asset type, or industry. In the Philippines, the stock index or Philippine Stock Exchange index is composed of the country’s 30 largest companies like Jollibee, Aboitiz, BPI, etc. The established companies with long history and proven track record. They’re also called blue chip stocks, giving out dividends to shareholders through the years.

Related: How much can you earn from investing in index funds

Index funds have the lowest management fees across all types of mutual funds because they are passively managed. This means that fund managers simply mirror the stock index. They buy and sell stocks of companies in a way that reflects its composition of the index, which is a basket of the top 30 companies and that leads to lower annual fee. You may also see a feeder fund, the Sun Life Prosperity World Equity Index Feeder Fund, Inc.

NameStarting capitalAddSales loadTrust feeExit feeHolding period
First Metro Save and Learn Philippine Index Fund, Inc.5,0001,0002%1.75%1%6 months
PAMI Equity Index Fund, Inc.1,0005003.36%1.5%1.12%6months
Philequity MSCI Philippine Index Fund, Inc.1,0005005%1%1%90 days
Philequity PSE Index Fund Inc.1,0005003.5%1%2%90 days
Philippine Stock Index Fund Corp.5,0001,0001.5%1%1%3months
Sun Life Prosperity Philippine Stock Index Fund, Inc.1,0001,000Front-end: up to 2%; or
Back-end: up to 5%
1%1%6months
Sun Life Prosperity World Equity Index Feeder Fund, Inc.50,00010,000Front-end: up to 2%; or
Back-end: up to 5%
1%1%30 days

You may discover that on the table that there are two funds that do not track PSEi, Philequity MSCI Philippine Index Fund, Inc. and Sun Life Prosperity World Equity Index Feeder Fund, Inc.

Equities funds

Equities funds are stock funds with different goals. Most of them are managed in a way to beat the returns of stock index or track a particular industry’s growth. Others are made up of stocks in a particular industry; the First Metro Philippine Consumer Fund on MSCI Philippine, Inc. for example invests in consumer and retail companies only.

Equities funds have higher management fees compared with the index funds. Usually, they are actively managed. Fund managers have a certain goal to achieve such as may be exceeding the returns of the stock index. In the table below, you will see that some data are not available (indicated with a question mark).

Some thing worth noting is that Sun Life equities funds don’t have any exit fee or holding period. There are also two dollar-denominated funds in the table. Lastly, the Atram equities funds have the lowest initial investments of ₱50.

NameInitialAddSales loadExitHoldFee
ALFM Growth Fund, Inc.5,0001,0003.00%1.00%90 days2%
ATRAM Alpha Opportunity Fund, Inc.50505.60%1.12%90 days2%
ATRAM AsiaPlus Equity Fund, Inc.$150$502.24%1.25%90 days0.5%
ATRAM Philippine Equity Opportunity Fund, Inc.50505.60%1.12%90 days2%
Climbs Share Capital Equity Investment Fund Corp.5001,0002.00%???
First Metro Consumer Fund on MSCI Phils. Inc.5,0001,0002.00%1.00%6 months1.750%
First Metro Save and Learn Equity Fund,Inc.5,0001,0002.00%1.00%6 months1.875%
MBG Equity Investment Fund, Inc.100,00010,0005.00%5.00%1 year2%
One Wealthy Nation Fund, Inc.5,0001,0003.00%1.00%6 months1.875%
Philam Strategic Growth Fund, Inc.5,0001,0003.00%1.00%6 months2%
Philequity Dividend Yield Fund, Inc.1,0005005.00%2.00%90 days3%
Philequity Fund, Inc.1,0005005.00%2.00%90 days1%
Soldivo Strategic Growth Fund, Inc.5,0001,0003.36%1.12%6 months2.25%
Sun Life Prosperity Philippine Equity Fund, Inc.1,0001,0002.00%NoneNone2%
Sun Life Prosperity World Voyager Fund, Inc.$1,000$2002.00%NoneNone1.75%
United Fund, Inc.1,0005002.00%3.50%1 year?

Balanced funds

Balanced funds are designed for people who may be averse to the risks posed by stocks but seek more returns than what are offered by bonds. They are a mix of both, and so they may be suitable for less aggressive investors.

A couple of things about balanced funds. Gretalife funds are going to terminate services before the end of this year. There are some that have undefined entries because although disclosed, the fee cannot be ascertained as a percentage of the assets under management. Those with question mark mean that there is no available data to base from.

NameInitialAddSales loadExitHoldTrust Fee
ALFM Global Multi-Asset Income Fund Inc.$100 or PHP equivalent$20 or PHP equivalent5%1%180 days1%
ATRAM Dynamic Allocation Fund, Inc.50505%1.12%90 days1.75%
ATRAM Philippine Balanced Fund, Inc.50505%1.12%90 days1.75%
Cocolife Dollar Fund Builder, Inc.$1,000$5000.5%1.5%1 year?
First Metro Save and Learn Balanced Fund Inc.5,0001,0002%1%6 months1.875%
Grepalife Balanced Fund Corporation5,0005002%2%1 year1.875%
NCM Mutual Fund of the Phils., Inc.100,00010,0003.36%1%6 months1.8%
PAMI Asia Balanced Fund, Inc.$200$503.36%1%6 months2%
PAMI Horizon Fund, Inc.5,0001,0002.8%1%6 months1.8%
Philam Fund, Inc.1,0005003%1%6 months2%
Solidaritas Fund, Inc.5,0001,0001.5%1%6 months2%
Sun Life of Canada Prosperity Balanced Fund, Inc.1,0001,0002%NoneNone2%
Sun Life Prosperity Achiever Fund 2028, Inc.1,0001,000None5%5 yearsundefined
Sun Life Prosperity Achiever Fund 2038, Inc.1,0001,000None5%5 yearsundefined
Sun Life Prosperity Achiever Fund 2048, Inc.1,0001,000None5%5 yearsundefined
Sun Life Prosperity Dollar Advantage Fund, Inc.$1,000$2002%NoneNone1.5%
Sun Life Prosperity Dollar Wellspring Fund, Inc.$1,000$2002%1%180 days1.5%
Sun Life Prosperity Dynamic Fund, Inc.1,0001,0002%1%30 days2%

Bond funds

Bond funds are for conservative investors. They are made up of fixed income securities such as bonds that hold debts of the Philippine government and companies. They’re relatively safe because debts are generally paid up when they mature and interests are regularly paid on time.

The fees of bond funds are actually similar, if not lower than, with the others. Again, the Sun Life products do not have any exit fee or holding period, but you can check the terms and conditions that are available in their website. What’s is also worth noting is that there are a few funds in denomination other than the Philippine peso.

NameInitialAddSales loadExit HoldFee
ALFM Dollar Bond Fund, Inc.$500$1005%1%6 months1.25%
ALFM Euro Bond Fund, Inc.EUR 500EUR 100 5% 1%6 months0.75%
ALFM Peso Bond Fund, Inc.5,0001,0001.25%1%90 days1%
ATRAM Corporate Bond Fund, Inc.50502.24%5%6 months1.2%
ATRAM Total Return Dollar Bond Fund, Inc.$150$50 5% 5%2 years1%
Cocolife Fixed Income Fund, Inc.1,0005002%3.5%1 year?
Ekklesia Mutual Fund Inc.5,0001,0002%1%6 months0.875%
First Metro Save and Learn Dollar Bond Fund, Inc.$1,000$1001%1%6 months1.75%
First Metro Save and Learn Fixed Income Fund, Inc.5,0001,0002%1%6 months1.75%
PAMI Global Bond Fund, Inc$5,000$1,0003%1%6 months2%
Philam Bond Fund, Inc.1,0005003%1%6 months1.5%
Philam Dollar Bond Fund, Inc.$2,000$1003%1%6 months1.5%
Philam Managed Income Fund, Inc.1,0005001%7 days0.25%
Philequity Dollar Income Fund Inc.$2,000$1,0001%1%2 years1.5%
Philequity Peso Bond Fund, Inc.10,0005,0001%1%2 years1.5%
Soldivo Bond Fund, Inc.5,0001,0003.36%1.12%6 months1.5%
Sun Life of Canada Prosperity Bond Fund, Inc.1,0001,0002%NoneNone1%
Sun Life Prosperity Dollar Abundance Fund, Inc.$1,000$2002%NoneNone1.5%
Sun Life Prosperity GS Fund, Inc.1,0001,0002%NoneNone1%

Money market funds

The money market funds are invested in assets that include short-term treasury notes and bank debts. They are considered safe investments and offer modest returns. The money market is actually a marketplace where banks can quickly grant or secure loans from one another.

There seems to be no available data for one of the funds in the table below. It is also important to take note of is that there seems to be less sales load in this bunch, and that the holding period is shorter compared with those found in other types of mutual funds.

NameInitialAddSales loadExitHoldFee
ALFM Money Market Fund, Inc.5,0001,0003%1%7 days0.5%
First Metro Save and Learn Money Market Fund, Inc.5,0001,000None1%7 days0.5%
Sun Life Prosperity Dollar Starter Fund, Inc.$500$100None0.25%7 days0.25%
Sun Life Prosperity Money Market Fund, Inc.100100None0.25%7 days0.25%

Exchange traded fund

The exchange traded fund (ETF) is a mutual fund that is traded on the Philippine Stock Exchange. You don’t buy it like the other funds on this list by going to a company. Instead, you buy shares from the stock exchange. In the country today, there’s only one ETF that exists. You can check the details about the fees in article on First First Metro Philippine Equity Exchange Traded Fund, Inc.

NameCompany
First First Metro Philippine Equity Exchange Traded Fund, Inc.First Metro

Conclusion

It took quite a while to complete the tables that you see here in this article. The goal is to really help you make the best decision when investing in mutual funds. Because fees can actually impact on how much you’re going to expect to receive, they must be part of your consideration.

List of all mutual funds in the Philippines

Below is the complete list of all mutual funds that are available in the country. It is updated as of January 3, 2020.

Fund nameTypeCurrency
ALFM Dollar Bond Fund, Inc.BondDollar
ALFM Euro Bond Fund, Inc.BondEuro
ALFM Global Multi-Asset Income Fund Inc.BalancedDollar
ALFM Growth Fund, Inc.EquityPeso
ALFM Money Market Fund, Inc.Money marketPeso
ALFM Peso Bond Fund, Inc.BondPeso
ATRAM Alpha Opportunity Fund, Inc.EquityPeso
ATRAM AsiaPlus Equity Fund, Inc.EquityDollar
ATRAM Corporate Bond Fund, Inc.BondPeso
ATRAM Dynamic Allocation Fund, Inc.BalancedPeso
ATRAM Philippine Balanced Fund, Inc.BalancedPeso
ATRAM Philippine Equity Opportunity Fund, Inc.EquityPeso
ATRAM Total Return Dollar Bond Fund, Inc.BondDollar
Climbs Share Capital Equity Investment Fund Corp.EquityPeso
Cocolife Dollar Fund Builder, Inc.BalancedDollar
Cocolife Fixed Income Fund, Inc.BondPeso
Ekklesia Mutual Fund Inc.BondPeso
First Metro Consumer Fund on MSCI Phils.EquityPeso
First Metro Phil. Equity Exchange Traded Fund, Inc.IndexPeso
First Metro Save and Learn Balanced Fund Inc.BalancedPeso
First Metro Save and Learn Dollar Bond Fund, Inc.BondDollar
First Metro Save and Learn Equity Fund,Inc.EquityPeso
First Metro Save and Learn F.BalancedPeso
First Metro Save and Learn Fixed Income Fund,Inc.BondPeso
First Metro Save and Learn Money Market Fund, Inc.Money marketPeso
First Metro Save and Learn Philippine Index Fund, Inc.IndexPeso
MBG Equity Investment Fund, Inc.EquityPeso
NCM Mutual Fund of the Phils.BalancedPeso
PAMI Asia Balanced Fund, Inc.BalancedDollar
PAMI Equity Index Fund, Inc.IndexPeso
PAMI Global Bond Fund, Inc.BondDollar
PAMI Horizon Fund, Inc.BalancedPeso
Philam Bond Fund, Inc.BondPeso
Philam Dollar Bond Fund, Inc.BondDollar
Philam Fund, Inc.BalancedPeso
Philam Managed Income Fund, Inc.BondPeso
Philam Strategic Growth Fund, Inc.EquityPeso
Philequity Alpha One Fund, Inc.EquityPeso
Philequity Dividend Yield Fund, Inc.EquityPeso
Philequity Dollar Income Fund Inc.BondDollar
Philequity Fund, Inc.EquityPeso
Philequity MSCI Philippine Index Fund, Inc.IndexPeso
Philequity Peso Bond Fund, Inc.BondPeso
Philequity PSE Index Fund Inc.IndexPeso
Philippine Stock Index Fund Corp.IndexPeso
Soldivo Bond Fund, Inc.BondPeso
Soldivo Strategic Growth Fund, Inc.EquityPeso
Solidaritas Fund, Inc.BalancedPeso
Sun Life of Canada Prosperity Balanced Fund, Inc.BalancedPeso
Sun Life of Canada Prosperity Bond Fund, Inc.BondPeso
Sun Life Prosperity Achiever Fund 2028, Inc.BalancedPeso
Sun Life Prosperity Achiever Fund 2038, Inc.BalancedPeso
Sun Life Prosperity Achiever Fund 2048, Inc.BalancedPeso
Sun Life Prosperity Dollar Abundance Fund, Inc.BondDollar
Sun Life Prosperity Dollar Advantage Fund, Inc.BalancedDollar
Sun Life Prosperity Dollar Starter Fund, Inc.Money marketDollar
Sun Life Prosperity Dollar Wellspring Fund, Inc.BalancedDollar
Sun Life Prosperity Dynamic Fund, Inc.BalancedPeso
Sun Life Prosperity GS Fund, Inc.BondPeso
Sun Life Prosperity Money Market Fund, Inc.Money marketPeso
Sun Life Prosperity Philippine Equity Fund, Inc.EquityPeso
Sun Life Prosperity Philippine Stock Index Fund, Inc.IndexPeso
Sun Life Prosperity World Equity Index Feeder Fund, Inc.IndexPeso
Sun Life Prosperity World Voyager Fund, Inc.EquityDollar
United Fund, Inc.EquityPeso

References

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