BDO Trust and Investments Group

BDO Peso Fixed Income Fund

Performance Report October 2014

INVESTMENT OBJECTIVE
The Fund aims to provide a high level of income with preservation of
capital and maintenance of liquidity by investing in a combination of
short to long-term fixed-income securities.

NAVPU vs. BENCHMARK & RISK-FREE RATE

2,000
BDO Peso Fixed Income Fund

1,800

HSBC 1-5Yr Bond Index (net)

91-d T-Bill Auction Rate (net)

1,600

CLIENT SUITABILITY
The Fund is suitable for individual and corporate investors with
moderate risk appetite and who are looking for higher yields and are
willing to take the attendant risks that come with portfolios that may
have investments with longer tenors. In order to minimize risks and
maximize earning potential, participants/ trustors are recommended
to stay invested in the Fund for at least three (3) years.

insert graph here

1,400
1,200
1,000
29-Apr-05

31-Oct-14

FUND PERFORMANCE (Absolute Return, Net of Taxes and Fees)

Period

ALLOWABLE/PROSPECTIVE INVESTMENTS
The following are the investment outlets where the Trustee may
invest the Fund in, depending on their availability or other market
circumstances: Deposits in the trustees bank or in other banks,
securities issued or guaranteed by the Philippine Government or the
BSP, tradable securities issued by any supranational entity,
exchange-listed fixed income securities and collective investment
plans of the trustee/other trustees. Subject to BSP guidelines and
the Trustee's Trust Committee approval, the Fund may also avail of
financial derivative instruments solely for the purpose of hedging risk
exposures, as well as invest in other tradable investment
outlets/categories as may be deemed suitable for the Fund.
FUND MANAGER'S REPORT
September CPI came in at 4.4% from 4.9% in August as food and
pump prices stabilized. Accordingly, the deceleration in inflation
provided room for the Monetary Board to hold the overnight
benchmark rate at 4.0%, SDA rate at 2.5% and bank reserve
requirement at 20%. Meanwhile, developments overseas also
benefited the domestic government securities market as the 10-yr
US Treasury bond yield slipped below the 2.0% level. Prices of fixedincome securities rallied across the curve with the return of risk-on
sentiment coupled with the very liquid market. On the local front,
long-term GS yields dropped by at least 20 basis points to 4.8% for
the 25-year paper and 4.45% for the 20-year. The new benchmark
10-year bond also traded below 4.0%, giving the fund manager an
opportunity to take profits and reduce exposure in the 10-year tenor
bucket. PFIF's portfolio was rebalanced with the sale of corporate
bonds and securities during the rally.

BDOPFIF

One Month Ago

Three Months Ago
Year to Date
One Year Ago
Three Years Ago
Five Years Ago
Since Inception
CAGR5 Since Inception
2

NAV per unit (NAVPU)

Par Value
Minimum Investment
Minimum Additional
Minimum Holding Period
Early Redemption Fee
Trust Fee
Custodian

0.08%
0.26%
0.79%
0.79%
2.44%
6.93%
26.49%

6.88%

5.67%

2.47%

Past performance is not indicative of future performance.

The Fund's benchmark is the HSBC 1-5 Yr Bond Index, commencing August 31, 2005.
Refers to 91-day T-Bill rates.
Compounded Annual Growth Rate (CAGR) measures how fast an investment would have grown over time if it grew at a steady rate instead of
actual varying rates.

4
5

PORTFOLIO STATISTICS

Dealing Period
Settlement Period
Others

September 30, 2014

October 31, 2014

3.87
2.32%
-0.12
-1.06
2.15%

3.46
2.28%
-0.07
-0.85
2.64%

Weighted Ave. Duration

Volatility, Past One Year6
Sharpe Ratio7
Information Ratio8
Weighted Ave. Yield (net9)
6

Volatility measures the degree to which the Fund fluctuates vis--vis its average return over a period of time.
Sharpe Ratio is used to characterize how well the return of a Fund compensates the investor for the level of risk taken. The higher the number,
the better.
8
Information Ratio measures reward-to-risk efficiency of the portfolio relative to the benchmark. The higher the number, the higher the reward
per unit of risk.
7

Net of taxes and trust fees.

PORTFOLIO COMPOSITION
October 2014

September 2014
Corp
Bonds
32.47%

BDOPFIF <Index>
Medium Term Bond Fund
April 29, 2005
Php 7.373 Billion
Php1,899.0649
Php 1,000.00
Php 10,000.00
Php 10,000.00
30 calendar days
0.50% of Original Participation Amount
1.00% p.a.
Standard Chartered Bank
Citibank
Up to 12:00 nn of any banking day
One (1) banking day after notice of
redemption is received
Available via the Easy Investment
Plan (EIP), which allows the build up
of funds through regular participation
of at least P1,000 per contribution.

Risk-Free Rate

0.51%
1.02%
3.29%
3.14%
11.37%
23.89%
70.19%

Corp Bonds
30.31%
SDA
29.23%

SDA
23.56%

FUND FACTS
Bloomberg Ticker
Fund Type
Inception Date
Net Asset Value (NAV)

Benchmark

0.66%
1.21%
0.92%
0.63%
16.04%
36.83%
89.91%

Short-term
deposits
0.69%

GS
43.28%

GS
40.46%

Short-term
deposits
0.00%

TOP TEN HOLDINGS10

Issue

Coupon Rate

Maturity

% of Portfolio

4.12500%
5.00000%
2.50000%
2.50000%
2.50000%
2.50000%
3.87500%
6.60000%
5.93000%
5.50000%

08/20/24
08/18/18
11/13/14
11/24/14
11/27/14
11/28/14
11/22/19
04/02/22
04/02/19
04/02/21

9.06%
7.69%
7.54%
7.23%
7.23%
7.23%
6.46%
4.94%
2.99%
2.07%

FXTN
FXTN
SDA 11
SDA 11
SDA 11
SDA 11
FXTN
San Miguel Bond 2022
San Miguel Bond 2019
San Miguel Bond 2021
10
11

The complete list of portfolio holdings is available upon request.

BSP Special Deposit Account.

BEST PERFORMANCE (Past Five Years)

1

The NAVPU of the Fund shall be computed every trading day at 7 p.m.

DISCLAIMER: The views expressed in this Update by BDO-Trust are strictly for information purposes only.
The UITFs are not deposit accounts but trust products. Participations in UITFs do not guarantee a rate of
return and are not covered by the Philippine Deposit Insurance Corporation (PDIC). BDO UITFs are
likewise not guaranteed by BDO. Investments or participations in the UITFs are subject to risks and
possible losses of principal. The value of the investments can go up or down and, upon redemption, may
be worth more or worth less than the original amounts invested. BDO-Trust is not liable for such losses,
which are for the sole account of the participants/trustors. Thus, it is important that the investors always
consider if these Funds are aligned with their financial goals, investment horizon and risk appetite. The
UITFs are charged for custodianship fees, financial service providers' fees and third-party audit fees whose
sum total does not exceed 0.10% of each of the Funds' volumes. For more information, kindly call (02) 8784255.

Inclusive Dates

Biggest Gain

No. of Days to Achieve

11/13/2009 05/20/2013

40.93%

1,284 days

MAXIMUM DRAWDOWN AND RECOVERY IN NAVpus12 (Past Five Years)

12

Maximum Drawdown Period

Biggest Loss

Recovery Period (days)

01/04/2011 02/17/2011

-2.85%

69 days

Maximum Drawdown is the maximum percentage loss that a fund incurs over a time period.
Maximum Drawdown Period is the length of time the maximum drawdown occurs.
Recovery Period is the length of time taken by a fund to surmount its maximum drawdown.