THE first quarter may have turned up less than stellar growth rates, but an investments officer of an asset management company foresees a better performance for the coming year.
Michael Gerard Enriquez, chief investments officer of Sun Life of Canada Philippines Inc. (SLOPCI), noted that as far as the financial markets are concerned, the Philippines did well in the first half of 2014, gaining 16.8 percent in the equities market.
While foreign investors may have eased out of the country during the latter part of last year due to an onslaught of calamities, Enriquez said foreign funds began returning in February, driving the markets higher.
Enriquez said there is anticipation that the government will be fast-tracking the redevelopment of typhoon-stricken provinces, which is seen to contribute greatly to GDP growth. He expects the second quarter to bounce back with 6.2 percent growth, with high infrastructure spending kicking off from the lag during the first quarter on top of movements in provinces hit by typhoon Yolanda.
He said there will be foreseen threats to the financial markets, with possible adjustments to interest rates and effects from a heightened problem between the executive and judicial branches of the government.
However, he believes these near-term hurdles will be overshadowed by the country’s strong liquidity and overall resilience.
He noted that when controversy over the priority development assistance fund (PDAF) and the disbursement acceleration program (DAP) first came out, the markets were not directly affected.
“We have not seen any major effect yet since the news broke. However, it can provide an excuse for investors to take profits and wait for better returns,” he said.
The coming presidential elections can also cause markets to be volatile, but Enriquez said this does not necessarily mean that they underperform during this period.
He admitted that the platforms and agenda of strong candidates and the members of the new president’s cabinet tend to affect the way markets perform but said any disruptions brought about by the elections will be temporary. He said that in general, if a candidate tends to have a business-friendly attitude, the markets take this as a positive thing.
While most have been wary about the Asean Economic Community (AEC), Enriquez believes there will be no near-term effects on the financial and banking sector, saying full integration for these sectors will be in 2020 yet. He added that the Philippines has the role observer for now as the Securities and Exchange Commission (SEC) is still figuring out taxation and how the country can participate.
He assured, however, that Sun Life is assessing how they can be ready to be a part of the AEC. He added that the merging of smaller banks with the bigger ones and the beefing up of capital are some of the ways banks are preparing for the AEC.
As chief investment officer, Enriquez formulates and implements portfolio strategies for the life insurance, variable universal life and mutual funds managed under SLOPCI and its subsidiaries.
With his assurances on the bullish outlook for the coming months, its asset management division, Sun Life Asset Management Company Inc. (SLAMCI), hopes more will see the value of investing in their latest mutual fund.
Maria Charina Fuentes, SLAMCI head of strategic development and training, introduced the Sun Life Prosperity Dynamic Fund, the first of its kind in the country.
The Dynamic Fund is a one-decision mutual fund that considers the best trade opportunities in the market and employs a tactical approach to asset allocation, adapting to market conditions by switching from fixed-income investments to equities as needed.
Fuentes said investors who are comfortable with moderate to high risks and are interested in long-term investment are best-suited to the Dynamic Fund. It is available for a minimum of P50,000 and subsequent investments of P10,000. They released the product in July 1 and have so far reached P1.24 billion assets under management. They are setting a cap of P2 billion.
The fund is available exclusively to Sun Life agents on a first-come, first-served basi
Source: Mia A. Aznar / SunStar
