Rizal Commercial Banking Corporation remains optimistic that opportunities to grow funds for the long-term are still available despite the extension anew of the Enhanced Community Quarantine until May 15.
“There is money to be made in the various asset classes we are tracking,” RCBC Chief Investment Officer Helen Go-Oleta said in an interview.
Oleta said investors can still look into maximizing the value of their assets in both the fixed income and equities markets with timing and investment appetite being crucial ingredients to the decision-making process.
“We believe a U-shape recovery may happen for the Philippines and to position ourselves as recovery unfolds may provide the highest level of return,” she added.
A U-shaped recovery means that the economic or financial performance took a sharp downturn but is expected to take a slow and gradual rebound over time.
Despite sentiments on the novel coronavirus disease (COVID-19) being the main burden for the financial markets right now, investors should already have a mindset of recovery when it comes to investing their funds.
“We have seen the Philippine equity market drop by as much as 38.4 percent from the peak to its recent low. This sharp decline, in less than a month, has never been seen in the history of the equity market both locally and globally,” Oleta said.
“To us, this presents an opportunity to invest in the equity market,” she added.
To enjoy potential movements in the equity market, she said investing in stocks is advisable which can be done through the Rizal Equity Fund, Rizal R25 Dividend Fund and Rizal R25 Blue Chip Equity Fund.
The decisiveness of the Bangko Sentral ng Pilipinas in using monetary tools has been applauded by the market for providing the much needed support by the economy as well making peso fixed income the best asset class year to date so far.
On the other spectrum, investors should be cautious in terms of investing in peso fixed income instruments as market yields are expected to increase once the economy enters its recovery process.
“Once we start the recovery process, we believe peso fixed income may not be the best option as we see reversal of market yields as our economy starts to heal. Technically, we expect the yields to move back up by at least 100 bps [basis points],” she said.
RCBC’s Rizal Peso Money Market, Rizal Bond Fund, and the Rizal Balanced Fund are products where investors can invest in to access the fixed income market.