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Should Filipinos invest in the global market?

One of the best ways to get a return on your investment is through investing in the stock market. When done right, your money can grow more than what you initially put in. However, the opposite can happen as well if mismanaged.

The Philippine Stock Exchange (PSE)reported during the pandemic, more Filipinos have been inclined to investing. In fact, a 70% increase in the PSE index was observed to date, coming from the March 2020 crash when the lockdown started.[1]

While there is no doubt many are now more knowledgeable when it comes to investing, there are still those who are hesitant to take their money globally because they might find investing outside the country daunting and difficult given the complexities of the international markets.

However, what many Filipino investors may not know is that the benefits can outweigh risks when done correctly. Here are three reasons to invest in foreign markets, according to top Fund Managers across the globe:

  1. Improved portfolio diversification

When asked, financial advisers would always say portfolio diversification is one of the most notable benefits for those who are looking into investing globally. According to BlackRock, an American multinational investment management corporation founded in 1988, “Portfolios are now able to spread exposure across many economies, potentially reduce risk and volatility associated with a single economy.”

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Portfolio diversification allows investors to “spread their eggs into different baskets” which means they get to distribute their investments to different stocks, economies, and markets. This helps to manage the level of risk associated with their portfolio and results in potentially more stable long-term returns.

  1. Access to compelling stocks outside of your home country

The stock market in the Philippines has become extremely competitive and saturated with investors over the years. International markets can offer a significantly larger marketplace with thousands of available stocks, giving the investor a wide selection of stocks not available in their home market.

As advised by Wellington Management, a private and independent investment management firm founded in Philadelphia, it is more beneficial to explore global markets because “investing beyond one’s borders opens up a world of opportunities.” Indeed, investing globally provides investors with more investment options and higher potential for significant returns.

  1. Growth on an international level

When it comes to household incomes, free-market policies and economic growth, investing in foreign markets provides more potential for growth than investing in local markets alone. “Companies increasingly operate in a global environment, so it is not sufficient to consider investment opportunities in isolation,” says Baillie Gifford, one of United Kingdom’s largest and oldest investment management firms.

If you’re invested globally, you get the chance to benefit from the economic growth of the markets you invested in overseas. So, even if your local stock market is down, you can still enjoy the increase in return from your international investments. Because of this, fund managers are always finding ways and strategizing toward global investments in the best economic climates all over the world.

Luckily for Filipino investors who want to go global, AIA Philam Life expanded its offerings with the launch of AIA Philam Life Elite Funds. Through these new funds, Filipinos now have access to global stock markets, and will be managed by Best-In-Class asset managers across the world namely, Baillie Gifford, Wellington Management, and BlackRock.

The new AIA Philam Life Elite Funds are designed to maximize the earning potential of common Filipinos’ hard-earned money through global funds. Policyholders may choose from different fund types depending on how much risk they are willing to take for the growth they would like their investment to achieve.

It will be available through its existing unit-linked insurance products, Family Provider and MoneyWorks. This expands the options policyholders can choose from to grow the account value of their life insurance plans. They may transfer to or add the peso-denominated AIA Philam Life Elite Funds in their portfolio. With access to a global portfolio of professionally-managed funds, customers will have the opportunity to grow their investment to meet their long-term savings objectives.

The AIA Philam Life Elite Funds are curated based on the customers’ risk profile and investment objectives. The Elite Adventurous Fund matches investors comfortable with higher risk in pursuit of higher return while the Elite Balanced Fund is perfect for those ready to take moderate risk for capital growth. For those with a low-risk profile but still seeking long-term total return, the Elite Conservative Fund is available. Each of these funds is uniquely created for AIA and managed by Best-in-Class asset managers.

AIA Philam Life has partnered with AIA Investment Management Pte. Ltd. (AIA IM) in the development of these funds. AIA IM is an AIA-affiliated company incorporated in 2016 as the hub for regional investment management that solely manages the assets of the AIA entities within the AIA Group. Through this collaboration, AIA Philam Life is able to open to Filipinos the opportunity to invest in global investments.

AIA Group manages more than US$244 billion in assets across 18 markets in Asia. It has a team of more than 150 investment professionals and access to the world’s finest global institutional asset managers. This partnership approach with external asset managers will help ensure the Elite Funds will deliver consistent long-term results.

Ready to grow your investment and take it to the next level? You can achieve your long-term investment goals whichever type of investor you may be with AIA Philam Life Elite Funds.

Click here to know more about AIA Philam Life’s Elite Funds or visit AIA Philam Life’s Facebook page, email philamlife@aia.com or call (02)8528-2000.

[1]The Rapid Rise of the Retail Investor. Business World. Published Jan 29, 2021.

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