The following are the different types of Mutual Funds available in the Philippines. Before you make a mutual fund investment or before you open an account, you must first know the classifications of mutual funds offered in the country.
Types of Mutual Funds in the Philippines
The most common types of MF available in the country are the following.
- Money Market Funds – are invested in a diversified portfolio of short-term fixed income and money market instruments. Money Market Funds are suitable for conservative investors who are looking for higher returns than regular savings and time deposits.
- Bond Funds – are invested in a diversified portfolio of medium to long-term fixed-income instruments like government securities, corporate notes and bonds and fixed income funds. These funds are suitable for moderate risk-taking investors who are looking for higher returns.
- Balanced Funds – are invested in a diversified portfolio of equity securities and fixed-income instruments. Balanced funds are suitable for those investors who are in between conservative and aggressive are who are looking for more profit in spite of risks.
- Equity Funds – are invested in a diversified portfolio of premium stocks or equity securities. These are suitable for aggressive investors who want to maximize earnings for a long term and understand the risks of the stock market.
- PSE Index Fund – is another type of equity fund invested in a diversified portfolio of stocks in the PSEI, usually in the same weights as in the index. These funds are suitable for those aggressive investors who want to maximize earnings for long term and who want to track the performance of the PSEI.
Notice that the higher the risk, the higher the earning potential.
Types of Mutual Funds Suitable for Time, Risks and Goal
Every investor must consider his time (investment horizon), risk tolerance and objective to decide well about his investments.
We’ve summarized the types of mutual fund recommended according to investment horizon, risk appetite and goal. Check the mutual fund infographic we made here:
As always, the final decision will be from you, the investor. All investments have risks.
Learn more about Mutual Funds here: Mutual Funds Tips and Guides