Learning More About ATRAM's Feeder Funds on GInvest

If there was one thing the COVID-19 pandemic did--I was practically forced to learn how to invest beyond showing up in person. I still prefer showing up in person to invest or to process transactions for more transparency. Given the conditions, it would be sometimes better to do some things online. I decided to get GCash (to pay restaurants that have deliveries but not through Grab and Foodpanda) and found GInvest. Previous features made it hard to count the number of units. I placed a few pesos to test my skill. I had to watch videos on how to invest effectively. Granted, it's my first time in so long to invest excess savings--I had made mistakes. Now, I decided to start buying a little more index funds and feeder funds. I decided to diversify my basket with two equity feeder funds from GInvest namely the Global Consumer Trends Feeder Fund and Global Technology Feeder Fund.

The Peso Lab - Money Guide for Filipinos explains the feeder fund (which is also a Unit Investment Trust Fund or UITF) in this way:

What is the purpose of feeder fund?

There are ways to purchase securities. People can buy stocks from the stock market and retail treasury bonds from the government. They can also go to banks, trust companies, and mutual fund companies. There are funds too that allow investors exposure to foreign securities.

So why is there a need for a feeder fund? Because it allows people to get exposed to diversified portfolio here and abroad.

Say that you’d like to invest in US stocks. You have two options: open an account with a stock broker that accepts non-US customers. There are several outlets like Charles Schwab, Interactive Brokers, TD Ameritrade, etc. And you’d go through an account opening process that is longer, requires various documents, requires a high starting capital, etc.

And the other option is through feeder funds. It can be relatively easy and there is no need to open an international stock brokerage account to be able to invest in foreign shares.

It would be very time-consuming if I decided to fly to the US just to get US-based stocks. I want to invest also in international stocks (which both ATRAM feeder funds in GInvest now have higher NAVPU, for now). I looked at the PDF documents from the ATRAM website and found out where the money possibly goes.

Investment allocation of the feeder funds

It would be good to know where it goes. Just don't put money into funds. I was looking at these funds and I'm convinced why I might focus on growing them too. Right now, both funds now have a higher NAVPU which means it's back to cost averaging over value cost averaging. It would mean investing less (at the same amount such as PHP 1,000.00 per month) when the market is high and investing more when the market is low. Both funds also have a 1.15% per annum trust fund.

ATRAM Global Consumer Trends Feeder Fund

For the ATRAM Global Consumer Trends Feeder Fund, the money would go into companies (based on the April 2022 report) like:

Amazon
EPR Properties
Lowes
Nintendo
Travel + Leisure
US Foods
Prologis
Tractor Supply
Electronic Arts
Sony

Having an Alexa Dot--it would be good to know that some of money that I pay for the feeder fund would go to Amazon. It means I'm indirectly holding some stocks from Amazon. Other companies there like Sony and Nintendo would also help in the feeder fund.

What would be interesting is to see the exposure to the consumer trends are as follows:

Hotel, restaurants, and leisure
Internet and direct marketing retail
Entertainment
Equity real estate investment trusts
Specialty retail
Interactive media and services
Food and staples retailing
Household durables
Other sectors

ATRAM Global Technology Feeder Fund

Now, we can also take a look at the ATRAM Global Technology Feeder Fund's allocation last April 22:

Microsoft Corporation
Apple Inc.
Salesforce Inc.
Amazon.com Inc
Alphabet Inc. (Google)
Samsung Electronics
Texas Instruments
Visa Inc.
NXP Semiconductors Nv
Fiserv Inc.

I would be glad to know that most of the funds are allocated to information technology. Speaking of which, I wanted to foolishly ride on the course even if I wasn't technologically inclined. Though, it doesn't mean I'm no IT expert but I can invest in IT-related stocks indirectly through this feeder fund. Microsoft is continually innovating. Apple products are a status symbol coveted by many. I still feel that I'm safe due to the constant innovation of Microsoft and Apple as two competing firms. Both will keep innovating in order to stay relevant. In turn, that may lead to an appreciation in the stock units which will drive up demand and might be best for long-term cost-averaging investments.

The rest of the Global Technology Feeder Fund involves the following:

Communication services
Consumer discretionary
Industrials
Energy
Real estate

What's in it for both funds?

So far, I've reached the minimum target but I don't intend to stop there. I intend to invest in a long-term horizon of maybe five to ten years. I want to reach a little higher whenever possible. If the market gets lower again then it's time to buy more. If not, stick to cost averaging to minimize losses. Though, with the slow regrowth--it might be time to consider selling the investment if the NAVPUs will increase after some time. However, having a horizon might be more feasible because investment is money that I don't need for now but the money I'm planning to have later.

Why do I want to invest in both consumer and technology funds? Both funds are growing. Investing in local stocks via the Philippine Equity Smart Index Fund may be a good start. I personally feel like the direct trading is scary or that my on/off short attention span is a problem. I may never become Warren Buffett but I can learn financial tips from him on how not to be broke. There'll only be one Buffett and I'm fine with it. Buffett also talks about index funds and that's why I got into the Philippine Equity Smart Index Fund. The fund in itself focuses on the stocks that comprise the Philippine Stock Exchange's index. You mean read about me wanting to learn more about that investment here.

In short, I've become an indirect stockholder but not a shareholder of foreign companies. So, I don't own a share of these companies--I only own stocks. The Accounting Tools website also would help me see where my portfolio is taking me based on units of participation:

The terms stockholder and shareholder both refer to the owner of shares in a company, which means that they are part-owners of a business. Thus, both terms mean the same thing, and you can use either one when referring to company ownership.

To delve into the underlying meaning of the terms, "stockholder" technically means the holder of stock, which can be construed as inventory, rather than shares. Conversely, "shareholder" means the holder of a share, which can only mean an equity share in a business. Thus, if you want to be picky, "shareholder" may be the more technically accurate term, since it only refers to company ownership.

References

Websites

"Philippines Feeder Fund What It Is And How To Invest"

https://pesolab.com/philippines-feeder-fund-what-it-is-and-how-to-invest/

"The difference between a stockholder and a shareholder" (May 18, 2022)

https://www.accountingtools.com/articles/what-is-the-difference-between-a-stockholder-and-a-sharehold.html

Filipino First Policy Linked with Crab Mentality

Having sea crab yesterday or just eating crab, I always think of that old commercial in the 1990s. It was called, "Iwasan ang crab mentality." or "Avoid crab mentality." This makes me recall a scene when I was a child. I saw a pail full of mud crabs (called alimango in Filipino) and if one crab got out, the others pulled it down. The TV commercial showed how if the crabs got together, they could all escape their grizzly fate of becoming eaten for human consumption. Chefs are just lucky crabs pull each other down. However, it also shows that the crabs would rather all be cooked together than let that crab escape. Unfortunately, crab mentality is one of the biggest problems in the Philippines. It's not all that unique among Filipinos. However, it doesn't Filipinos should ever take comfort in engaging in a crab mentality, just because other people do it . Here's an interesting excerpt from Inquirer by Jerry Peres de Tagle PhD: Studies in human behavior ...

It's a Common, Broken New Year's Resolution Among Filipinos to Do Better with Their Finances and Economic Knowledge

Happy New Year, right? There's this statement in Cebuano that says, "Sa Disyembre nag lipay-lipay. Sa Enero, naglikay-likay." For non-Cebuano speakers, it means, "Enjoying all December. Fleeing in January." It's because of the bad habits that are common during the Christmas season. I wrote an entry talking about when a Merry Christmas leads to an Unhappy New Year . After Christmas vacation, it can be common to talk about New Year's Resolutions. Sadly, there are resolutions meant to be broken or resolutions on paper only. Several people finish high school, go to college, get a job, but never gain the necessary knowledge of economics and finances. Instead, they continue to live the same habits year after year. Even worse, the same foolish behavioral patterns get passed down f rom parent to child to grandchild. Still stuck with financial habits that put one in a financial dodo The New Year starts and it can get funny. I tend to hate December because of the ...

Rejoicing Over Filipino Businesses Getting 100% Ownership Abroad While Crying Over FDIs Getting Allowed to Own 100% Ownership

The Philippine senatorial elections are on, right? One of the many things candidates (regardless of party) need to hold is the need for economic reform. As I continue discussing economic charter change, several objections are held. One of the objections is allowing 100% FDI--a subject often subjected to mockery. These mockeries can range from promoting colonial mentality, selling the Filipino to foreigners, borrowing money from abroad (which is definitely not investment, read here ), or even the ridiculous notion that FDI includes Filipino women dating foreigners (read here ). This time, I would like to address another hypocrisy. This time, it's all about Filipinos who rejoice that Filipino businesses are investing with 100% FDI ownership. All the while, this is crying foul when there's a law passed that will allow foreigners to own 100% FDI ownership , in the Philippines. This is a meme to expose the hypocrisy. Jollibee has 158 branches in Vietnam, which I assume happened bec...

The Recent Microsoft Global Outage Should be a Wake-Up Call to the Philippines' Need to Fix the 1987 Constitution's Economic Flaws

The Express Tribune The recent Microsoft Global Outage was caused by Crowdstrike. Since I'm no IT or CS expert--it's better if I let them talk in the news. From BBC News , here's a detail from Crowdstrike that reveals the root cause of the problem has been systemic with an update: This is still a little unclear. CrowdStrike is known for producing antivirus software, intended to prevent hackers from causing this very type of disruption. According to CrowdStrike boss George Kurtz, the issues are only impacting Windows PCs and no other operating systems, and were caused by a defect in a recent update . "The issue has been identified, isolated and a fix has been deployed," he said. "This is not a security incident or cyber-attack." What exactly was wrong with the update is yet to be revealed, but as a potential fix involves deleting a single file, it is possible that just one rogue file could be at the root of all the mayhem. Thankfully, those who created th...

Is Vietnam Getting More FDI Inflows than the Philippines, Because of Its Supposedly Better Fight Against Corruption?

Discussing international marketing or world economics with boomer Filipinos can be painful. Some people still believe in the Filipino First Policy. I cite Vietnam as an example of why economic charter change (called econ cha cha) should be done. Some people cite that Vietnam's increase in FDI is because of the fight against corruption. I don't deny Vietnam has a crackdown on corruption. I don't deny that fighting against corruption helps the economy. However, fighting corruption without the proper tools and not having economic development, is useless. Fighting corruption isn't a panacea or cure-all either. Spanking is part of child discipline, not the whole of child discipline. People who only spank but never teach right and wrong, render spanking ineffective . Instead, look at Vietnam's economic policy vs. the Philippines' economic policy. Some people blame the following for the Philippines' lack of foreign investments, some things Vietnam also suffers fr...

Trying to Plan Out What to Do as a Bull Market Starts

I was laughing just thinking about ignorance about the bear and bull markets. Yes, we know about social media gossipers (seldom called a marites in Filipino) tend to spread gossip. I ran into several people panicking when the Philippine Stock Exchange Index (PSEi) was mostly red. Others would panic but Warren Edward Buffett recommends, "Be fearful when others are greedy. Be greedy when others are fearful." That's the best market timing. Some people do cost averaging because it's practically less risky in contrast to lump sum investing. Buffett recommends that non-technical people should periodically invest in a low-cost index fund over a period of ten years. Now, the Philippine Star has an article by Wilson Sy, where the first paragraph talks about the Philippines' entry towards the bull market : Most stock markets have undergone a dramatic shift to start the year, transitioning from a bear market to a bull market. Peak inflation, a slower pace of interest rate h...

When the Education Cares TOO MUCH About Grades, Schools Produce Idiots Instead of Intellectuals

During the pandemic, I was left in limbo thinking about my poor performance under K+10. It was something to think about that a classmate of mine who was both a summa cum laude and an honor student, ended up posting on his wall, "Students cheat because the education system cares more about grades instead of learning." The class salutatorian of our batch even commented about the good old days. I always had that feeling of insecurity and envy towards people better than me. But as Warren Edward Buffet would say, "Don't hate successful people. Learn from them instead." One of them is currently a teacher and the other is in Canada. I thought about my insecurities especially when I used to believe I was descended from a fine scholar and my family was a family of scholars. I remembered the time I was taking MBA and got conned. I was asked, "Is that what MBA taught you?" I got touchy and ended up admitting, eventually, that I was only taking MBA for the presti...

My Personal Opinion on the Recent Universal Robina Incident

I was doing some news readings and I found out about the death of a certain Stephen Corilla. The incident happened in the Universal Robina Corporation's factory in Mandaue a few days ago. It really chilled my bones to read these details which I'll share from Sunstar : POLICE are set to investigate a food and beverage plant in Barangay Tabok, Mandaue City after one of its workers was killed on duty while cleaning a pulverizer machine Thursday afternoon, June 2, 2022. Cpl. Glenn Bordalba of the Mandaue City Police Office Station 3 in Barangay Basak who is leading the investigation told SunStar Cebu Monday, June 6, that they will visit the Universal Robina Corp. (URC) Mandaue City plant in Tabok on Tuesday, June 7, to investigate the matter. Bordalba added that they have not started the investigation yet as they were not allowed entry to the site by the URC management after the incident was reported to them. An approval from the corporation’s consultant is needed for the police to...

My Experience with Tealive Cebu at the Ayala Central Bloc

I have tasted several foreign-owned tea shops. My first experience with tea shops was with Chatime (read here ). Now, I heard of this new coffee shop (or tea shop, take your pick) called Tealive. At first, I thought it was Taiwanese but when I Googled it--it was Malaysian. It made sense that the company uses only Halal-approved ingredients since Malaysia has a huge Muslim population. The founder is Malaysian-Chinese businessman Bryan Loo of Loob Holdings. Loob here also means inside as the Tagalog language also derives from the Malay language. Tealive would later head to the Philippines. It would be like getting Filipinos closer to their Malaysian heritage after all. The branches in Cebu include SM City, SM Seaside, and Ayala Central Bloc. The one I ate was at Ayala Central Bloc. Someone gave me a taste of their sandwich and their signature coffee. I was pretty much impressed that I decided to dine in there. I went to try their lychee tea and chees burger. For a note, their ...

Getting Stingy at the Cost of Fire Safety?

March is fire prevention month, right? If there are people who are too extravagant then I'd like to talk again about stingy people (read the article here ). I've tried growing up with the stingy vs. extravagant extremes. Some people become stingy even with the necessities. It's one thing to deny a child a children's party since it's a want . It's another thing to deny a child stuff they need all in the name of saving money . Even worse, some people may be more than stingy enough to ignore fire safety. A stingy person just wants to save. It's almost like the story of the Miser and His Gold or The Rich Miser . I really find these stories entertaining at the same time, irritating. The first story has the miser who hid his gold under the ground. Some people today are too distrustful of banks and investments. The second story has a rich man who even dresses in rags, denies his son's shoes, had his wife cook some cake only for him, and was so greedy he had it ...

Shaun T. Dy's Business & Economics Perspective Blog

Search This Blog