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07 Activity 1

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91 views

07 Activity 1

Uploaded by

Queene Buscaya
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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BM2004

NAME: Buscaya, Jacky L. DATE: SCORE:

I. INVESTMENT DECISIONS (22 points)


Below are two (2) investment companies in the country and their related investments data gathered
from the Philippines' website of Unit Investment Trust Fund.

ATRAM Trust Corporation (ATC)

(𝑁𝐴𝑉𝑝𝑈)*
Types of Funds Net Asset Value per Unit Return on Investments - Minimum Initial Participation
Year-to-Date (ROI -YTD) %
Long-Term Bond Funds 96.16 -4.16 P1,000
Equity Funds 102.61 -8.00 P1,000

BPI Asset Management and Trust Corporation (BPI AMTC)

(𝑁𝐴𝑉𝑝𝑈)*
Types of Funds Net Asset Value per Unit Return on Investments - Minimum Initial Participation
Year-to-Date (ROI -YTD) %
Long-Term Bond Funds 326.24 10.66 P10,000
Equity Funds 150.08 -11.96 P10,000
Answer the following questions.
1. You are an investor with P25,000 to invest. Aside from the above information, what other factors do
you need to consider to determine which option to invest in? Name at least two (2) and discuss
them in no more than three (3) sentences. (10 points: 2 items x 5 points)

 The most important thing to take into account is determining when to use your capital most
effectively. One of the factors that determines where to spend your money is the other. You may
want to increase your money quickly, and you don't care if you take a chance because you have
more time to get back up after a setback.

2. The NAVPU of the above ATC funds are lower than that of BPI AMTC. Do you think it should affect
your investment decision? Justify your answer in no more than three (3) sentences.

 When the price exceeds the average company value, the business makes money, and when the
price is lower than the average company value, the business loses the
economy when the price is lower than the company's typical overall worth. Additionally, ATC
funds are less than BPI AMTC, which will probably affect my choice of investments.

3. The equity fund of BPI AMTC (-11.96%) is underperforming YTD versus that of ATRAM (-8%). Does
that mean it will continue to underperform in the future? Justify your answer in no more than three
(3) sentences.

 Since that suggests that a stock is expected to do just a little worse than the average
return on the stock market, I predict that it will continue to underperform. Other terms for
underperformance include "moderate sell," "weak hold," and "underweight."

07 Activity 1 *Property of STI


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BM2004

II. COLLECTIVE INVESTMENT SCHEMES (CIS) (15 points: 3 items x 5 points)


Read the problems and solve for what is ask. Write your complete solution in the space provided.

1. Abraham Equity Fund is regulated by the Securities and Exchange Commission (SEC). It has managed
various corporate stocks with a total asset value of P465 million at the beginning of the year. At the
end of the year, the stocks' prices went up by 12% and dividends received for the year amounted to
P8 million. Expenses equal to 3% of the total asset value at the end of the year. The total
shares/units amounted to 5 million.

a. What type of collective investment scheme (CIS) is Abraham Equity Fund? Discuss your answer in
no more than three (3) sentences.

 The Abraham Equity Scheme is an open-end collective investment scheme (CIS).


because an infinite number of shares may be issued by the fund. The fund sponsor
both redeems and sells shares to investors directly. Every day, the price of these
shares is determined by their current net asset value (NAV).

b. How much is the value of the portfolio per share of Abraham Equity Fund?

c. Assume instead that Abraham Equity Fund is regulated by the Bangko Sentral ng Pilipinas (BSP).
Cersei Lannister invested in the fund for an amount of P6,000,000. How many units was she able
to subscribe to the fund?

Rubric for grading the computation:


CRITERIA POINTS
Complete solution with the correct answer 5
The last two (2) major steps of the solution are incorrect 4
Half of the solution is correct 3
The first two (2) major steps of the solution are correct 2
The first major step of the solution is correct 1

Rubric for grading the essay:


CRITERIA PERFORMANCE INDICATORS POINTS
Content The answer is based on underlying financial and economic principles and is supported 3
by real-life examples.
Organization of The answer is concise, well-organized, and direct to the point. 2
Ideas
Total 5
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BM2004

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