SSS picks up blue chips at bargain prices

Despite the stock market’s slump over the past few months, the Social Security System (SSS) is "selectively" trading at the bourse.

"We are at a buying side of major issues but on the selective stance," SSS chairman and president Carlos Arellano said in an interview.

According to Arellano, they believe it is time to take advantage of the low prices of shares in the local bourse, particularly the blue chip issues.

"We want to take a (buying) position on cheap blue chip issues like Meralco (Manila Electric Co.), SMC (San Miguel Corp.)," he said.

SSS is allowed, under its charter, to invest some 30 percent of its investible funds in the equities market.

However, SSS investment head Horace Templo admitted that they have "cautiously" invested in the stock market for the past few months when the Philippine Stock Exchange (PSE) index started to drop.

Templo said they have shifted their investment portfolio "a little bit" to the fixed income government securities where SSS is also allowed to invest some of its funds.

Arellano said they need to continue investing some of their funds in the equities market. "We continue to invest (in the stock market). We have to let our portfolio grow to give our members more benefits," he said.

According to Arellano, they are looking at the possibility of increasing the benefits of pensioners and SSS employees this coming Christmas season. "That is why we need to enhance our investment portfolio," he said.

He said they are still studying the possibility of imposing an additional contribution rate. At present, the contribution rate of the country is about eight percent, among the lowest in the region.

But the increase, he said, would be done later next year or after the May elections. –Donnabelle Gatdula