Adelberto A. Legasto, senior vice president of the BPI Asset Management Group, said they have shifted from extremely cautious or "neutral" to aggressive in view of the improving economic fundamentals that have lifted sentiment toward the stock market.
A "neutral" position basically meant limiting investments to only the top 10 companies in the equities market.
"We were cautious then, but more aggressive now in the equities market especially at the start of the second quarter," Legasto said.
Last Friday, the Philippine Composite Index (Phisix) closed 90.15 points or 8.4 percent higher week-on-week at 1,163.84, its highest level in nearly a year.
At end-May, the funds managed by the BPI group stood at P126 billion from P100 billion at the start of the year, roughly a quarter of the P500-billion managed by the country’s common trust fund (CTF) industry.
The BPI unit added that it would continue to be biased towards short- and medium-term securities and "stand ready to take advantage of market opportunities to allow enhancement of portfolio yield."
"We will take anything that the market offers as it assures high yields and low risk for our funds," Legasto added.
The group had invested heavily on the two issues of the retail treasury bonds (RTBs), debt issues of prime corporate names, the Republic of the Philippines papers and bonds (ROPs), dollar- and euro-backed issues, and the recent promissory notes released by the Bureau of Treasury (BTr).
"In fact, we bought between 60 to 70 percent of the BTr offer," Legasto pointed out.
As proof of their positive gains, its funds showed higher return on investments (ROI) as compared to the benchmark 91-day Treasury Bill (T-bill).
"Large growth in portfolio was due to notable increase in our yields. We made good investments that resulted in huge gains for the fund," Legasto stressed.
Last year, the asset and trust group practically stayed clear of the equities market as negative factors, including fears of a prolonged Iraq-US conflict, continued to depress the Philippine economy. Majority of its managed funds were then hedged in low-risk fixed income instruments.
In fact, it was so bad last year that only seven percent of its total exposure to the equities market remained in the local bourse. All the rest are in global equities markets and other foreign currency investment instruments.