Mutual fund is one of the best investments available nowadays. When you invest in mutual funds, you will just wait to make your money grow and until the time you need the money you invested. Usually, people invest their money in mutual fund for several reasons such as for retirement, college expenses and for emergency fund. In this article you will know the procedures on how to invest in mutual fund.
Mutual Fund Investment Procedures
The procedures on investing in mutual funds are given below for you to have an idea on how the process is carried out. It is simple and easy much similar when opening a bank account.
1. Get a copy of prospectus of the mutual fund and study it.
In any kind of investing, you need to study, study and study. So what is a prospectus? In the prospectus, you can learn useful information about the mutual fund and the mutual fund company. You will know who manages the fund and most important, the present and past performance of mutual fund. You can get a prospectus in the website of mutual fund company you want to invest in.
2. Fill out an account opening form and investment application form of the mutual fund of your choice.
When I invested in mutual fund, I went directly to the office of my mutual fund in Makati. Its very easy, it took only less than an hour to finish. However, even if you’re abroad or in far away places in the Philippines, you can still invest by sending all requirements via post office or private courier. My friend invested in ALFM even he’s in South Korea.
3. Ready and furnish all application requirements.
a) For individual (personal) accounts, ready photocopies of two (2) valid IDs such as company ID, SSS/GSIS ID, Driver’s License, Passport or any government ID.
b) For corporate accounts, ready a copy of the following:
Articles of Incorporation and by-laws
SEC Certificate of Registration
Secretary’s certificate / Board resolution, authorizing the investment
Secretary’s certificate on the percentage of ownership/capital stock held by non-Filipino shareholders
4. Go to the office of your mutual fund company or send document via registered mail
To pass your requirements and application forms, you can personally go to the office of MF company or you may send it via registers mail of couriers. It will be better if you can call the mutual fund office so that you may know other requirements or procedures. Basically, the procedure listed here is common to all mutual fund companies.
5. Deposit your Initial Investment
Deliver your payment to the mutual company office, or deposit directly to the fund’s account. If you’re paying through checks, it should be made payable to the fund of your choice. When you opened the account directly to their office, you should deposit an initial investment for your account to be approved and active. The minimum initial investment is only P5,000.
6. Issuance of Official Receipt and Statement of Account
The mutual fund company will issue a receipt and statement of account where you can see the number of shares you bought and its corresponding net asset value per share (NAVPS).
Basically, opening or buying a mutual fund involves careful study and understanding of the fund. Study and research first before you invest.
August 24th, 2010 at 23:33
Does it mean that I don’t need to have a broker in order to apply for or invest in a mutual fund?
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Gil Reply:
August 25th, 2010 at 03:02
Hi Tim! You don’t need a broker, you need a mutual fund company when investing in MF.
FAMI is one of the best mutual fund companies today.
Thanks for the visit.
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August 30th, 2010 at 06:43
Hi Gil,
thank you for a straightforward instruction on how to invest on mutual fund. I’ve been exploring this investment opportunity but somehow I could not take the plunge. I just might start doing it soon.
Mighty
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Gil Reply:
August 30th, 2010 at 08:50
Your welcome, hope this will help you more.
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December 6th, 2010 at 23:42
Just a dummy question:
Is it similar with COL’s EIP wherein you have to invest a certain amount monthly?
Can it be done even without going directly to the office?
Is the portfolio accessible via Internet?
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Gil Reply:
December 10th, 2010 at 03:11
Hi Chris,
It’s not the same with COL.
It depends on you how frequent and how much you will invest.
No forced investing, it depends on your decision.
You can open a mutual fund even if you are abroad or far away from Manila.
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January 6th, 2011 at 05:36
Hello! I find your site very helpful as I’m thinking of investing in FAMI. Can I arrange that a certain amount be debited from my savings account every month, and do I have to pay a sales load every time?
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Gil Reply:
January 6th, 2011 at 22:46
Hi Chona,
Yes, you can make a scheduled debit using Metrobank online banking. You must set the schedule in your account.
Every time you buy a mutual fund, you need to pay the sales load of 2% for amount less than P100,000.
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January 16th, 2011 at 05:18
Does it mean that I don
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January 16th, 2011 at 05:25
Does it mean that I don
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January 22nd, 2011 at 06:17
So, is it ok to just invest one time? And leave it for a year (or more). Is it subject to dormant account penalties?
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Gil Reply:
January 23rd, 2011 at 02:13
Hi Chris,
Yes it is ok to invest one time, there’s no dormant fee like the bank charges.
However, in mutual fund investing, it is best to invest in regular interval, say quarterly with a certain amount.
For as low as P5,000 initial investment and P1,000 thereafter, you can invest in MF.
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February 15th, 2011 at 06:06
Hi Gil, what is the advantage of investing in regular interval against one time investment?
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Gil Reply:
February 16th, 2011 at 22:47
Hi Grace,
Investing in regulara interval will give you the power of leveraging, meaning if you invest a certain amount monthly or quarterly, it will give higher return than one time investment.
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April 20th, 2011 at 13:13
Hi Gil,
I want to ask for your ADVICE. I am going to put P5,000 a month or more under Save and Learn Equity Fund under FAMI. Is it good to add every month in this type of investment? I am an OFW and I wanted my money to work for me. Thank you.
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Gil Reply:
April 21st, 2011 at 03:31
Hi Wynbol,
Yup it is advisable to put a regular amount in MF say P5,000 per month if you can do it.
It is called leveraging, one good strategy in investing.
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April 21st, 2011 at 16:26
Hi Gil,
I’m planning to invest but I’m not sure if I will invest in mutual fund or in stocks. Please help me decide on which to choose. What are the pros and cons for both.
Thanks.
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Gil Reply:
April 22nd, 2011 at 03:44
Hi Jules,
MF has small initial deposit when you open an account only P10,000 while for stock account, you need P25k (in citiseconline).
MF is managed by professional fund managers, You will manage your own stocks.
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April 22nd, 2011 at 12:19
Hi Gil,
Thanks.
So, is it correct to say that stocks has higher gain compare to MF but at the same time it has higher risks?
Can you suggest MF company that I can invest into?
Thanks again.
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Gil Reply:
April 25th, 2011 at 08:26
Hi,
I suggests you invest in FAMI or ALFM.
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May 22nd, 2011 at 15:30
Hello!
Thanks for this information.Where will I get the prospectus? I want to study MutualFund investing first then I will proceed after understanding everything.
I am here in China and not planning to go home yet. I’m still saving for some future investments.
Cora
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Gil Reply:
May 24th, 2011 at 23:03
Hi Cora,
You can get the prospectus at MF website like FAMI. Visit it here: fami.com.ph
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June 17th, 2011 at 15:51
What is the minimum amount for investing in most mutual funds?
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July 8th, 2011 at 02:58
Hi Gil, thanks for providing a link to http://www.piloncitos.com I appreciate the gesture. I hope our site can complement yours and further assist pinoys with their investment decisions, specifically with Mutual Funds and UITFs. We are improving the site and adding more tools. Personally I have learned a lot from your site as well, reading through your posts. I also appreciate that you stress the importance of spiritual truths regarding managing one’s money.
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July 19th, 2011 at 17:52
My name is John Lagdameo and I am a licensed Mutual Fund agent. Please feel free to contact me at 09228625148 or jelagdameo@yahoo.com.ph
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August 23rd, 2011 at 09:22
MF is managed by an investment company, UITF is managed by banks. They are the same when it comes to where the money is invested, stocks, bonds, etc.
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August 23rd, 2011 at 09:22
MF is managed by an investment company, UITF is managed by banks. They are the same when it comes to where the money is invested, stocks, bonds, etc.
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September 22nd, 2011 at 01:42
what is the minimum amount to invest in mutual fund?
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learnfe Reply:
March 17th, 2012 at 06:40
Hi RJ,
You can invest as low as P5,000 in MF.
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January 5th, 2012 at 12:09
what is the minimum amount to invest in mutual fund?
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learnfe Reply:
January 5th, 2012 at 12:41
Hi Gracia,
The minimum amount to invest in mutual fund is P5,000.
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February 29th, 2012 at 04:05
where to invest? aside from First Metro and Citesec?
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learnfe Reply:
March 1st, 2012 at 06:19
Hi< If you want to invest in mutual funds, just visit this link: http://learnfinancialeducation.com/list-of-top-mutual-funds-in-the-philippines/
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March 9th, 2012 at 10:10
if you want to learn more about financial mngt., aside from mutual funds. attend our wealth academy program in our company in makati. If your interested contact me at 09154229090.
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April 6th, 2012 at 18:32
First. thanks for all the wonderful blogs. I have been reading about mutual funds and planning to invest on it when I go back home this July. I know you tried FAMI right? another good company I researched was philequity. i know that they are affiliated (don’t know if that’s the right word for it) with unionbank and banco de oro. And I read your first blog that you directly applied to FAMI. should I apply directly to their office? or would it be ok. like to apply in the bank? like metrobank (FAMI) or unionbank (philequity) whats the difference? thank you
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Gil Reply:
April 8th, 2012 at 11:45
Hi Claudia,
You can apply for mutual funds either by going directly to their office or by mailing the application forms and requirements to their address. You can apply mutual funds at BPI but not in Metrobank.
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