Helping Investors See Opportunities, Seize Opportunities Investors Se… · average time deposit...

Paul Joseph Garcia October 21, 2011

Helping Investors See Opportunities, Seize Opportunities PERAA Administrators’ Conference

Basic Investment Concepts

What are Funds

Investment Insights

Sample Funds and Do it Yourself Portfolios

Q&A

Agenda

Basic Investment Concepts

Family Professionals

Retirees

Students

Couples

Who Can Invest?

• A group of individual securities or investments that have:

– A common financial form e.g. common stocks, bonds, real estate, etc. – Perform in a significantly similar fashion

distinct from other asset types

• Typically, the major asset classes are:

– Cash

– Fixed Income/ Debt instruments

– Equity

– Real Estate

– Alternative Assets

What is an Asset Class?

Ret

urn

Risk

DEPOSITS

EQUITIES

BONDS

OTHERS • Higher returns imply higher risk • Less risk will give lower returns

Time Deposits

Savings Accounts

T-Bills

FXTNs

ROPs

Exchange-listed Stocks

Venture Capital

Real Estate

Jewelry

The Investible Returns

Peso Bond

100

110

120

130

140

150

160

170

180

5/5/03

9/5/03

1/5/04

5/5/04

9/5/04

1/5/05

5/5/05

9/5/05

1/5/06

5/5/06

9/5/06

1/5/07

5/5/07

9/5/07

1/5/08

5/5/08

9/5/08

1/5/09

5/5/09

9/5/09

Oakwood

Presidential

Campaign

Downgrade by

S&P and

Moody’s

• Bunye wiretap

recordings

•Hello Garci; TRO on

EVAT

Rising UST yields;

Hyatt 10 resignation;

Market

correction

Volatility - Part and parcel of Financial markets

Since Inception to October 6, 2009

Geo-political

concerns

No matter how volatile

markets are, it will recover over

a period of time

2H06 bond rally!!!

Government

fiscal concerns

Sources: Bloomberg, ING

Past performance is not necessarily

a guide to future performance.

Financial

industry crisis,

Global recession

Risk Reward: High Return = High Risk, Low Return = Low Risk

Investing is not a Straight Line – subject to volatility

The LONGER you invest [in a risky asset], the greater the chance of a positive return

Investment Horizon medium to long term (3-5yrs).

The younger you are, the more risk you can take.

Diversification reduces risk.

Key Points to Remember

What are Funds?

A FUND is…

Investment Vehicle

Access to the Financial markets (bonds, equities, etc.)

Pools your money with other investors

Investment Manager

What is a Fund?

Professional Management

1 2

• Team • Full time • Shops for the best value • Experience

Affordable

Liquidity

Diversification •Not only in one type of investment

Option A

Option C

Option B

Benefits in Investing in Funds

UNITS OF PARTICIPATION

INVESTMENT MANAGER

…and invested in a portfolio

STOCKS

BONDS

CASH

Investors

Money is pooled…

Php

How do UITFs Work?

Benchmark Performance Comparison

0

20

40

60

80

100

120

140

160

180

Per

cen

tage

(%

)

PSEI HSBC Local Currency Bond Index

91-day t-bill MSCI World Index

JPMorgan Total Return Philippines JPMorgan Emerging Market Bond Index

*All in Peso terms Sources: Bloomberg, BPI Asset Management

Investment Insights

Investment Insight: Financial Planning, the Next Frontier in Investing

Investment Insight: Financial Planning, the Next Frontier in Investing

Cash Dom. Bond Inter. Bond Inter. Equity Phil USD Bond Dom. Equity

Return 8.95% 17.07% 16.03% 13.58% 21.40% 13.17%

Std Deviation 1.16% 3.61% 12.91% 16.39% 14.61% 31.13%

Risk Return Profile (Asset Class)

C ash

Internat io nal

Equity

D o mestic B o nd

P hil. USD

B o nds

Internat io nal

F ixedD o mestic Equity

0%

5%

10%

15%

20%

25%

0% 5% 10% 15% 20% 25% 30% 35%

Risk (Annualized Standard Deviation)

Re

turn

(A

nn

ua

lize

d A

ve

rag

e

Re

turn

%)

17

Risk Return Graph 1991-2005 15-year historical (PHP terms)

Based on BPI/Division 3 SAA Study

Mandate

Asset ClassInvestment

Range (%)

Benchmark

Asset Allocation

(%)

Investment

Range (%)

Benchmark

Asset Allocation

(%)

Investment

Range (%)

Benchmark

Asset Allocation

(%)

Investment

Range (%)

Benchmark

Asset Allocation

(%)

Domestic Equities 5-25 15 15-35 25 20-30 30 45-65 55

International Equities 0-20 10 10-20 15 10-30 20 10-20 15

Total Growth 5-45 25 25-55 40 30-70 50 55-85 70Domestic Fixed

Income 20-80 50 15-55 25 5-45 25 0-20 5

Domestic Dollar Bonds0-10 5 0-10 5 0-10 5 0-10 5

International Fixed

Income 0-10 5 0-10 5 0-10 5 0-10 5

Cash (<1 Year) 0-70 0 0-55 10 0-65 0 0-40 0

Emerging Market Debt5-25 15 5-25 15 5-25 15 5-25 15

Total Defensive 55-95 75 45-75 60 30-70 50 15-45 30

Projected ReturnsAnnualized Volatility

(using 2005-2009 data)

12.550%

20.241%

CONSERVATIVE CAPITAL STABLE BALANCED MANAGED

9.200%

10.205%

9.690%

12.120%

10.700%

14.303%

Strategic Asset Allocation Model Portfolios

Sample Funds and

“Do it Yourself “

Investment Portfolio

Sample: Moderately Conservative Portfolio

Period covered - August 31, 2010- August 31, 2011

Sample: Aggressive Portfolio

Period covered - August 31, 2010- August 31, 2011

Fund Performance*

Figures as of October 3, 2011 *Past performance not indicative of future results

Fund Performance*

Figures as of October 3, 2011 *Past performance not indicative of future results

What to look for in a Fund/Fund Manager?

Superior Investment Performance

Global Investment /management Platform

Global and Local Fund Management Expertise

Seasoned, High Performance Investment Team

Questions?

Thank you! Odyssey Funds

Annex

Performance vs. Peers as of September 22, 2011

Odyssey Funds

Odyssey Equity Funds: Ahead of the Rest

Odyssey Diversified Balanced Fund: Leading the Pack

Odyssey Phil. Dollar Bond Fund: A Top Performer

Odyssey Peso Bond Fund: Top 2

Money Market Funds

Medium-term Peso Bond Funds

Consistent Return - Identifies a fund that

has provided relatively superior consistency and risk-adjusted returns

- A high rating may be the best fit for investors who value a fund's year-to-year consistency

Total Return

- Denotes a fund that has provided superior total returns

- May be the best fit for investors who want the best historical return, without looking at risk.

Preservation

- Demonstrates a fund that has provided superior ability to preserve capital in a variety of markets.

- Choosing Preservation may help to minimize downside risk relative to other fund choices

Lipper Leader Ranking (as of August 31, 2011)

Lipper Leader Ranking (as of August 31, 2011)

Money Market Odyssey Funds

Odyssey Peso Cash Management Fund

Fund Features

Launch Date 25-May-05

Fund Classification (TOAP) Money Market Fund

Fund Currency Philippine Peso

Duration Max 1 year

Benchmark HSBC Money Market Index

Bloomberg Code INGPCSH Index

Trust Fee 0.75% p.a.

A diversified portfolio invested in short-term peso-denominated Philippine government securities, corporate bonds, peso deposits, and similar instruments.

Basically is your starter fund

Most conservative, low duration

Ideal substitute to your average time deposit product

Ideal for 6 months to 1 year investment period

Invested in Short-Term fixed income instruments


Highlights NAVPU Graph

Past performance not indicative of future results.

10.50

10.80

11.10

11.40

11.70

12.00

12.30

12.60

12.90

13.20

13.50

13.80

14.10

Apr-07 May-08 Jun-09 Jul-10 Aug-11

Peso Cash Management Fund

HSBC Money Market Index

Figures as of 8/31/11


Key Figures and Statistics


Cumulative Performance 1 mo 1YR 3YRS 5YRS S.I.

Peso Cash Mgt Fund 0.37 3.64 12.16 23.55 36.90

Benchmark 0.85 4.20 13.38 22.89 31.72

Annualized Performance 1YR 2YRS 3YRS 4YRS 5YRS S.I.

Peso Cash Mgt Fund 3.64 3.41 3.90 3.92 4.32 5.07

Benchmark 4.20 3.77 4.28 4.19 4.21 4.43

Net Asset Value per Unit (NAVPU) PHP 13.69

Total Fund NAV (mln) PHP 784.98

Duration (Interest Rate Risk) Years 0.05

Portfolio Weighted Yield to Maturity (YTM) %, net˚ 3.10

Current Number of Holdings 1


Odyssey Peso Cash Management Fund Top Holdings

Maturity Profile Portfolio Allocation

98.79%

0.00%1.21%

Cash Govts Corps


Fixed Income Odyssey Funds

Odyssey Peso Income Fund

Fund Features

Launch Date 1-Oct-07

Fund Classification (TOAP) Medium-Term Fund


Duration 3-5 years

Benchmark HLBI (1-5 Years)

Bloomberg Code INGPINC Index


A diversified portfolio invested in medium-term peso-denominated Philippine government securities, corporate bonds, peso deposits, and similar instruments. The fund also aims to distribute income on a semi-annual basis.


Highlights Medium-term bond fund

Recommended investment period at least 12 months

NAVPU Graph


NAVPUs gross of any income distribution

98100102104106108110112114116118120122124126128130

Oct-07 Sep-09 Aug-11

Peso Income Fund

HP15TR




Cumulative Performance 1 mo 6 mos 1YR 3YRS S.I.

Peso Income Fund 1.77 6.56 7.63 21.59 26.90

Benchmark 1.65 6.55 8.30 25.21 29.20

Annualized Performance 1YR 2YRS 3YRS S.I.

Peso Income Fund 7.63 6.80 6.73 6.27

Benchmark 8.30 6.98 7.78 6.76

Key Figures and Statistics Net Asset Value per Unit (NAVPU) PHP 107.61






Odyssey Peso Bond Fund

Fund Features


Fund Classification (TOAP) Long-Term Fund


Duration > 5 years

Benchmark HSBC Liquid Bond Index

Bloomberg Code INGPFIN Index


A diversified portfolio of peso-denominated fixed income instruments (government securities and corporates).


Highlights Significantly more aggressive

than average SDA/TD, therefore higher yield potential

Recommended investment period is 3 to 5 years

Duration is greater than 5 years

NAVPU Graph



140

150

160

170

180

190

200

210

220

230

Mar-07 May-09 Aug-11

Peso Bond Fund

HSBC LBI


Key Figures and Statistics Past performance not indicative of future results.


Peso Bond Fund 2.79 9.43 28.13 47.84 101.60

Benchmark 2.56 10.00 30.15 51.74 116.80


Peso Bond Fund 9.43 9.46 8.61 7.72 8.13 8.78

Benchmark 10.00 9.33 9.18 7.97 8.70 9.74


Total Fund NAV (mln) PHP 3,068.15





Odyssey Emerging Market Bond Fund (formerly US Dollar Income Fund)

Fund Features


Fund Classification (TOAP) Medium-Term Fund

Fund Currency US Dollar

Duration 3-5 years

Benchmark JPM EMBIG Div (1-5 years)

Bloomberg Code INGUSIN Index


A diversified portfolio primarily of investment grade dollar bonds that aims to provide capital appreciation and income growth over time.

Odyssey Emerging Market Bond Fund Highlights Only 1 of its kind in the UITF market

Specifically designed for investors who have too much exposure in Philippine assets but would like to get the same type of yields

True test of diversification – Foreign securities are less closely related to local developments

Access BPI AMTG’s expertise in EM debt

Basket of 9-12 sovereign issues across 4 continents

NAVPU Graph



NAVPUs gross of any income distribution

9.75

10.25

10.75

11.25

11.75

12.25

12.75

13.25

13.75

14.25

14.75

15.25

Apr-07 Mar-08 Jan-09 Nov-09 Oct-10 Aug-11

Emerging Market Bond Fund

EMBIG (Div1-5 Years) ex-MY

Odyssey Emerging Market Bond Fund

Key Figures and Statistics Returns are gross of fees. Past performance not indicative of future results.


Emerging Market Bond Fund -0.12 2.65 8.49 16.80 22.55

Benchmark -0.57 4.62 23.78 40.64 47.58


Emerging Market Bond Fund 2.65 4.94 2.75 2.98 3.15 3.25

Benchmark 4.62 6.85 7.37 7.31 7.06 6.32

Net Asset Value per Unit (NAVPU) USD 9.79

Total Fund NAV (mln) USD 11.07



Current Number of Holdings 10Figures as of 8/31/11

Odyssey Emerging Market Bond Fund Top Holdings

Country Weightings

Maturity Profile


Odyssey Philippine Dollar Bond Fund

Fund Features


Fund Classification (TOAP) Long-Term Fund


Duration More than 5 years

Benchmark JACI Philippines

Bloomberg Code INGPDFI Index


A diversified portfolio of US$-denominated fixed income instruments issued by the Philippine gov’t and Philippine corporations.

Highlights 1st US dollar denominated

UITF in the industry

Has the longest track record

A long duration bond fund

Invested in ROPs and Philippine corporate bonds

NAVPU Graph


11121314151617181920212223242526

May-07 Oct-08 Mar-10 Aug-11

Philippine Dollar Bond Fund

JP Morgan Index



Key Figures and Statistics Past performance not indicative of future results.


Phil. Dollar Bond Fund 1.47 5.81 34.19 54.76 114.20

Benchmark 1.34 5.66 42.43 68.78 148.28


Phil. Dollar Bond Fund 5.81 13.79 10.30 9.56 9.13 9.58

Benchmark 5.66 14.11 12.51 11.66 11.04 11.54

Net Asset Value per Unit (NAVPU) USD 21.42







Balanced Odyssey Funds

Odyssey Diversified Capital Fund

Fund Features

Launch Date 4-Dec-06

Fund Classification (TOAP) Balanced Fund


Duration Max 5 years

Benchmark 70% HLBI, 30% PSEi

Bloomberg Code INGDVCP Index


A diversified portfolio invested in peso-denominated Philippine government securities, corporate bonds, AND stocks listed on the Philippine Stock Exchange (PSE).

Highlights Designed for investors

looking to give their fixed income portfolio a “kicker”

Suited for investors who are willing to take on more risk

Maximum 40% Equity allocation

NAVPU Graph


75

80

85

90

95

100

105

110

115

120

125

130

135

140

145

150

Dec-06 Apr-09 Aug-11

Diversifed Capital Fund

70% HLBI, 30% PSEi






Div. Capital Fund 2.60 17.05 21.47 46.94 40.69

Benchmark 0.77 10.80 13.78 41.23 46.02

Annualized Performance 1YR 2YRS 3YRS 4YRS S.I.

Div. Capital Fund 21.47 17.34 13.69 7.78 7.46

Benchmark 13.78 13.52 12.19 8.14 8.31






Top Five Bond Holdings Portfolio Allocation

Top Five Equity Holdings

36.11%

62.35%

1.54%

Equities Bonds Cash



Fund Features


Fund Classification (TOAP) Balanced Fund


Duration Max 5 years

Benchmark 50% HLBI, 50% PSEi

Bloomberg Code INGDVBA Index


A diversified portfolio invested in peso-denominated Philippine government securities, corporate bonds, AND stocks listed on the Philippine Stock Exchange (PSE).

Odyssey Diversified Balanced Fund

Highlights Designed for investors looking

for higher yields

A “swing fund”

Maximum 80% Equity allocation

NAVPU Graph


75

83

91

99

107

115

123

131

139

147

155

163

171

179

May-06 Dec-08 Aug-11

Diversified Balanced Fund

50% HLBI, 50% PSEi






Div. Balanced Fund 1.90 28.85 59.43 78.09 70.26

Benchmark -0.43 16.21 47.97 74.69 66.89

Annualized Performance 1YR 2YRS 3YRS 4YRS 5YRS

Div. Balanced Fund 28.85 22.55 16.82 8.15 12.24

Benchmark 16.21 16.25 13.95 7.98 11.80






Top Five Bond Holdings Portfolio Allocation

Top Five Equity Holdings 70.68%

26.88%

2.44%

Equities Bonds Cash



Equities Odyssey Funds

Odyssey Philippine Equity Fund

Fund Features


Fund Classification Equity Fund


Benchmark PSEi

Bloomberg Code INGPHEQ Index


A portfolio of stocks listed on the Philippine Stock Exchange (PSE).

Highlights Invested in high risk, but

historically, the best performing asset class

Fully invested in stocks listed on the (PSE)

Heavily invested in mining and holding firms

NAVPU Graph


120

145

170

195

220

245

270

295

320

345

370

395

420

445

May-06 Feb-08 Nov-09 Aug-11

Philippine Equity Fund

PSEi





Phil. Equity Fund 0.48 40.80 86.40 110.18 333.55

Benchmark -3.44 21.94 61.77 88.07 276.69


Phil. Equity Fund 40.80 31.15 23.07 8.38 16.02 19.26

Benchmark 21.94 22.79 17.39 6.62 13.46 17.26Past performance not indicative of future results.


Net Asset Value per Unit (NAVPU)³ PHP 433.55




Top 10 Holdings

Sector Holdings



Odyssey Philippine High Conviction Equity Fund

Fund Features

Launch Date 1-Feb-07



Benchmark PSEi

Bloomberg Code INGPHCE Index


A concentrated portfolio of stocks listed on the Philippine Stock Exchange (PSE).

Highlights A concentrated portfolio

Invests in about 20-30 stocks

Represents the fund manager’s outlook or “conviction” as to the best stock picks given quantitative and qualitative evidence.

NAVPU Graph


405060708090

100110120130140150160170180190200210

Feb-07 May-09 Aug-11

High Conviction Equity Fund

PSEi





Phil High Con Eq Fund 3.40 46.59 66.84 156.40 94.96

Benchmark -3.44 15.44 21.94 61.77 34.00

Annualized Performance 1YR 2YRS 3YRS 4YRS S.I.

Phil High Con Eq Fund 66.84 49.43 36.87 15.11 15.69

Benchmark 21.94 22.79 17.39 6.62 6.60Past performance not indicative of future results.


Net Asset Value per Unit (NAVPU)³ PHP 194.96




Top 10 Holdings

Sector Holdings



Odyssey Asia Pacific High Dividend Equity Fund

Fund Features




Benchmark MSCI AC Asia Pacific ex-Japan

Bloomberg Code INGAPHD Index


A diversified portfolio of attractively priced stocks with high dividend yields listed in the Asia Pacific region.

Highlights Exposure to equity markets in the

Asia Pacific region

High-dividend strategy

Invests in 100 to 150 stocks

Recovery in Asia is expected to outpace the rest of the world

Managed by ING Asia Pacific, Ltd. (Hong Kong)

NAVPU Graph


3.75

4.50

5.25

6.00

6.75

7.50

8.25

9.00

9.75

10.50

11.25

May-08 Dec-09 Aug-11

Asia Pacific High Div Eq Fund

MSCI AC AP ex-Japan





Asia Pac High Div Eq Fund -9.35 -6.56 7.56 17.39 -6.90

Benchmark -8.49 -3.58 12.55 27.09 -2.80

Annualized Performance 1YR 2YRS 3YRS

Asia Pac High Div Eq Fund 7.56 8.35 2.48

Benchmark 12.55 12.73 7.03Past performance not indicative of future results.


Net Asset Value per Unit (NAVPU)³ USD 9.31




Industry Allocation

Country Allocation



Thank you! Odyssey Funds

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