March 31, 2019
PHILAM FUND, INC.
FUND FACT SHEET
1
Historical Performance Investment Objective
FUND 1 MO 1 YR 3 YRS 5 YRS S.I.3 The investment objective is to achieve capital growth and generate steady
-1.37% -5.99% 3.20% 3.20% 789.60% income. The recommended timeframe for the fund is 7 years or more. This
Cumulative
fund is suitable for investors who: have a medium to long term investment
Annualized -5.99% 1.06% 0.63% 8.98%
horizon; want a diversified portfolio of investment in equities, fixed income
YTD 2018 2017 2016 2015 and money market securities; and/or are willing to take moderate risk for
Calendar Year 2.05% -9.40% 11.48% -1.47% -4.74% potentially moderate capital return over the medium to long term.
Benchmark2 1 MO 1 YR 3 YRS 5 YRS S.I.3
Cumulative -1.63% -1.95% 11.51% 21.16% 601.46%
Top Five Equity Holdings
Annualized -1.95% 3.70% 3.91% 7.97% SM INVESTMENTS CORP 6.08%
YTD 2018 2017 2016 2015 AYALA LAND INC 4.89%
Calendar Year 3.95% -7.55% 13.88% 0.74% -0.70% SM PRIME HOLDINGS INC 4.36%
1. Returns are net of fees. Past performance is not indicative of future returns. AYALA CORPORATION 4.27%
2. 50% Philippines Composite (Total Return) + 40% Bloomberg Philippine Sovereign Bond
Index AI + 10% Phil 30 Days Savings Rate General Avg (Net of 20% WHT) as of 03/31/2019. BDO UNIBANK INC 3.55%
3. Since Inception (September 28, 1993)
Top Five Fixed Income Holdings
Key Figures and Statistics FXTN 2017 8.00% DUE 19JULY31 6.08%
Net Asset Value per Share (NAVPS) 16.6548 GPN 36 6.25% DUE 14JAN36 4.89%
Total Fund Size (in Millions) 11,019.63 PHILIPPINE TBILL 0% 10/07/2019 4.36%
YOY Return as of 03/31/2019 -5.99% CB SMPH2025 6.0804% DUE ON 01MAR2025 4.27%
Benchmark YOY Return as of 03/31/2019 -1.95% FXTN 25-8 8.125% DUE 16DEC2035 3.55%
Annualized Volatility 9.67%
Inception Date September 28, 1993
Fund Classification Balanced Fund
Fund Allocation
Risk Profile Moderate
Fund Currency Philippine Peso Fixed
Income, Equities,
Domicile Philippines 49.2% 50.8%
Min. Initial Investment Php1,000.00
Min. Transaction Php500.00
Min. Holding Period Six Months
Redemption Notice Period Three Days
Valuation Method Marked-to-Market
Custodian Bank Citibank N.A.
NAVPS Graph
Transfer Agent Philam Asset Management, Inc. 25
20
15
10 3/31/2019
5
0
10/1/98 10/1/01 10/1/04 10/1/07 10/1/10 10/1/13 10/1/16
Commentary
Equities
For Q4 2018 earnings, 27 companies have reported core net income grew by 15.7%. This brings 2018 full year earnings to 8.5%. Numbers are below expectation of 10% but at least Q4 showed strong
recovery from Q3. Overall, we are expecting 2019 earnings to grow between 10-12% and expect index to still hit our 8200 targets.
Market will be weak and range bound from April to May. A lot of investor will continue to wait as headwinds have surfaced. These are: 1.) government budget still in impasse, 2.) MSCI rebalancing to
occur in May, where foreign outflows are expected to be sizeable, 3.) Elections in May, and 4.) BSP action on monetary policy. Despite these issues, we do believe market will be stronger during H2 of
2019.
Fixed Income
Local bond market actively traded during the month with investors favoring long-dated securities. Local bond yields rallied as Fed remains dovish and February CPI printed better than expected at 3.8%,
which resulted to an inversion of the yield curve. The short to belly securities dropped by an average of 19bps M/m, while the 10-yr and 20-yr benchmark yields significantly decreased by 75bps and
83bps M/m, respectively.
After a solid performance in the first quarter, long dated securities are vulnerable to correction and further gains are limited. Because consumer prices are anticipated to bottom in the third quarter, we do
not expect long duration positioning to fade in a significant way. The yield curve is projected to moderately normalize in the coming quarter anchored by the following assumptions: (1) Economic growth
and inflation in the months ahead is expected to slow down strengthening prospects of a 1% Reserve Requirement cut in the period to 17%, mobilizing an estimated Php100B into the economy; (2) The
2nd quarter bond supply is inclined to dampen demand for the long maturing bonds with heavy auction supply of 7 up to 20 years. This in turn will renew interest in short term bonds which offer near 6%
return per annum. (3) Market volatility will remain elevated surrounding uncertainties on trade policy conflict and UK exit in the EU. To temper shifts in risk appetite and grounded by the Fed rate hike
pause, demand is likely to shift to short-term investments that offer value and stability.
