Sharing spreads more blessings. Today I share with you how to earn monthly dollar dividends in the Philippines without trading in the US stock market.
I always like earning fixed income, and one of my Retail Treasury Bonds (RTB) investments has matured already. So I asked my reliable banker any related investment product where I could re-invest my money and earn income regularly.
Thus, I found out about Allianz PNB Life Dollar Income Growth Dividend Paying Fund. With this investment, I won’t be getting a fixed income every quarter. Instead, I will be getting MORE every month because I could be earning monthly dollar dividend income and more profit potential once my net asset value grew over time.
What is Allianz PNB Life Dollar Income and Growth Dividend Paying Fund?
Allianz PNB Life Dollar Income and Growth Dividend Paying Fund is an investment fund with a goal to generate regular dividend income and long-term capital appreciation by investing primarily in US stocks, US high yield bonds, and US convertible bonds.
Why I Invested $20,000 in Dollar Income and Growth Dividend Paying Fund?
Monthly Dollar Dividend Payouts
I invested $20,000 in the Dollar Income and Growth Dividend Paying Fund because I think it would generate more profit for my savings through monthly dividend payouts and asset value appreciation.
The average monthly dividend yield of my investment is 0.57%. For my $20,000 investment, it lets me earn an average of $114 every month. Cash is credited to my PNB USD account, which I can withdraw anytime.
It’s like earning a rental income every month, even without an apartment. For 12 months, my dollar dividend income will have an average of $1,368 (P67,000).
This is what I could be making as monthly dividend if my capital is as follows:
Smart Asset Composition
The fund is strategically allocated in three assets: high yield bonds, convertible bonds, and US equities.
The composition of the investment is allocated more in bonds than stocks which I prefer at this time with the capital I set aside. I won’t be touching this capital in three to five years for regular passive income, although it is not a requirement.
Dollar Exchange Rate
Another reason why I decided to invest in this fund is the current dollar rate. It was below the Php50 level when I opened my investment. I anticipate that USD will climb back to its Php50+ level.
The dividends I receive every month are in USD. I can withdraw them anytime or hold them, or grow them as long as I want.
The US dollar has been weak due to the pandemic and rise of inflation, but the US is expected for recovery growth in 2021, and the coming election in the Philippines could weaken the peso.
Net Asset Value Performance
The NAVPU (Net Asset Value Per Unit) performance of the fund is impressive. I entered below its all-time high, and I get dividends every month. I expect a moderate risk, but I’m confident with the rewards I would be getting with this investment in the long run.
Benefits of Dollar Income Growth Dividend Paying Fund:
Monthly Dividends (Tax-Free)
As I mentioned, one of the top benefits of Allianz PNB Life Dollar Income Growth Dividend Paying Fund is the monthly dividend income which will be credited to your PNB dollar account tax-free.
The annual dividend yield in July 2021 is 6.73%, and the monthly dividend yield is 0.56%. It is indeed an effortless way to earn passive income.
Cut off for dividends is every 10th of the month. The credit of dividend income is within 20 business days after the dividend declaration (usually happens every month end or the first week of the following month).
Financial experts professionally manage the investment. The fund manager is Allianz Global Investors, a prestigious financial management firm owned by Allianz SE, a giant asset management and insurance company in Germany. Allianz has partnered with the Philippine National Bank, one of the largest commercial banks in the Philippines, to offer this investment fund.
When experts manage your fund, you don’t need to study the market, the economy, the best companies, assets, and strategies to beat the market or achieve capital growth. Your fund manager will do the complex and challenging stuff to reach the fund investment goals.
Invest in the USA while in the Philippines
Allianz PNB Life Dollar Income Growth Dividend Paying Fund will let you invest in US bonds and stocks without trading the US stock market or opening a stockbroker account while you are in the Philippines.
You will have exposure to companies in the United States since your fund will be allocated in US equities, US high yield bonds, and US convertible bonds. It’s a great way to have investment exposure in the US while you are a resident of the Philippines.
Top 5 Stock Holdings of Allianz Income and Growth Fund:
Top 5 High Yield Bonds Holdings of Allianz Income and Growth Fund:
- Tenet Healthcare Corp.
- Ford Motor Co.
- Transdigm Inc.
- Kraft Heinz Foods Co.
- American Airlines
Top 5 Convertible Bonds Holdings of Allianz Income and Growth Fund:
- Tesla Inc.
- Danaher Corp.
- Broadcom Inc.
- Microchip Technology Inc.
- Wells Fargo & Co.
You will get a life insurance policy when you open an Allianz PNB Life Dollar Income Growth Dividend Paying Fund. Amidst the risks of the fund, you will be protected and insured.
Aside from the regular dividend payouts, the investor can also have profit potential when his investment value grows over time. Allianz PNB Life dollar income growth dividend-paying fund has been performing well since the pandemic.
No Lock-in Contract
Of course, past performance is not an indication of future results. You can still decide when to redeem your entire investment and realize your profit.
How to Earn Dollar Dividends in the Philippines Without Trading in the US Stock Market?
1. Know your risk profile
Allianz PNB Life dollar income growth dividend-paying fund is suitable for moderate to aggressive type of investor. If you want to grow your capital for long term and accept the risks and volatility of the market, you can start investing in this fund.
If you’re afraid of sudden market crashes or unpredictable market trends, then this type of fund may not be for you.
2. Open a PNB Dollar Account
Since your investment is in USD, you will need a PNB dollar account because that is where your dividend income will be credited. It is straightforward to open a USD account in the Philippines. You can connect with an official PNB employee like Ms. Yhang Dungo. She will gladly assist your needs or inquiries.
3. Open a Dollar Income Growth Dividend Paying Fund
The next thing you need to do is open your investment. It’s also easy to open an account. You need to be a resident of the Philippines. Primary requirements are valid IDs and Tax ID Number (TIN).
More importantly, you need to fill out a Client Suitability Assessment form and Investor Profile Questionnaire to help you and your fund manager understand what type of investments are suitable for your risk tolerance.
The minimum fund to invest in Allianz PNB Life Dollar Income Growth Dividend Paying Fund without a premium charge is $20,000. You can invest more than that amount if you prefer.
4. Invest for long term
The dollar and income growth dividend-paying fund is suitable for medium to long-term investment because it is allocated to high yield bonds, convertible bonds, and common stocks. Some bonds mature in one year or more. Blue-chip stocks also need some months to grow in value.
5. Redeem your funds
When you reached your target profit and target holding period, you can redeem your entire investment. You can re-invest again whenever you want.
What are the risks of investing in the Dollar Income Growth Dividend Paying Fund?
Bonds and stocks carry volatility and risks just like other funds and assets in the market. An investor must be comfortable with market uncertainties and numerous factors that can affect the movement of interest rates and prices of stocks.
Factors like US Federal Reserve (Fed) decisions and commentaries, economic outlook, companies’ earnings, politics, inflation, consumer sentiment, market trends, stock market news, pandemic, and investors’ interests can affect the movement of the stock market.
Disclosure and Disclaimer: This article is for information purposes only and should not be considered as professional advice or endorsement of a particular investment. The author has units of Allianz PNB Life Dollar Income Growth Dividend Paying Fund. The article is written from her investment experience, objective, strategy, and opinion. Past performance is not an indication of future results. All investment have risks. Risk only the capital you’re comfortable to lose. Always do your own research before investing.
10 thoughts on “How to Earn Dollar Dividends in PH Without Trading the US Stock Market”
Example I will withdraw my capital for almost 6 years still have the service charged
Hi, the Optimal Power Dollar for this investment has no withdraw charge but with 6% premium charge. See the details below:
Optimal Power Dollar:
Minimum fund $2K
Premium charge 6%
Withdrawable anytime with 0 charge
Maximal Power Dollar:
Minimum fund $20K
No premium charge
1st yr 8%
2nd yr 6%
3rd yr 4%
4th yr 2%
5th yr 1%
Are you sure you are gonna get back your $20k in full say once you redeem when navpu is at breakeven or at the same price when you first put in your ‘investment’?
Hi Jen, every time I make an investment, I already accept the fact that there is no guarantee I’d be getting my money back in full. But all the investments I opened with PNB (UITF, TD, RTB) were all profitable. I have a strong faith with this new one, too.
This Allianz product is an insurance with an investment component. Unlike the products you mentioned, uitf, TD and rtb, the Allianz product provides mainly “protection” for your beneficiaries. For everyone’s reference, usually for insurance, the beneficiaries get the principal or face value of the insurance on the death of the “investor” so I suggest for those reading this, don’t be blinded by the dividends and make sure you are aware when/how will you get your principal.
I get your point here and I respect your views regarding this. I’m well aware that this is an insurance and I’m comfortable with the risks and rewards of this fund. As I’ve said, this is suitable for aggressive investors with long term objective. Unlike other insurances or VUL, you can withdraw your total funds in 5 years with only 1% fee. The Optimal Power Dollar has no withdraw charge.
Hi Fehl. Coupon rates of US corporate bonds are rarely over 6%. I wonder how this Allianz PNB Insurance product can pay a high 6.7% annual dividend!
Hi Romeo, the fund is allocated with high yield bonds and common stocks, too. Just like other investments, when the performance of the fund is excellent, the dividends will also increase. On the risky side, dividends will drop when the investment performed poorly.
minimum investment is USD2K not 20K
Hi, thank you for visiting 🙂 $2K is the minimum for the Optimal Power Dollar which has a premium charge of 6%. I featured the Maximal Power Dollar which is suited for long-term investment with earning potential as shown above.