Philippines is now Investment Grade

from: Rappler.com


MANILA, Philippines - The Philippines won its first ever investment grade debt rating from global credit rating firm Fitch.

By upgrading the Philippines' sovereign credit rating to BBB- from BB+, Fitch gives the Philippines a vote of confidence and marks the first time the Philippines, once a basket case in Asia, joins the A-lister countries considered safe to invest in.

In a statement on Wednesday, March 27, Fitch added a stable outlook and cited a robust economy and improved fiscal management.

"The Philippine economy has been resilient, expanding 6.6% in 2012 amid a weak global economic backdrop. Strong domestic demand drove this outturn," Fitch said.

Fitch was the first among the other international credit rating firms -- Standard & Poor's (S&P) and Moody's Investors Service, which still rates the country one notch below investment grade. S&P currently rates the Philippines a BB+ market, while Moody's gave it a Ba1.

What a credit rating means

An investment grade is a seal of good housekeeping. It tells investors it is safe to do business in the country, and encourages them to put huge capital here.

An investment grade means the Philippines, as a borrowing country, has a strong ability to pay its debt. This lowers its borrowing costs, generating savings, which may be spent for social services. For Filipinos, it means better education and health care, and affordable loans for major purchases.

link to source: http://www.rappler.com/business/economy-watch/24936-a-first-investment-grade-rating-for-ph

Stock Update as of March 26, 2013

SM is planning to merge SMDC with SMPH. As you may have observed, the stock price for SMPH dropped. Now, SMDC's current price is  8.48. Think about it this way, if we get the average of the 2 stock prices, what happens? 18.46 (SMPH) + 8.48 (SMDC) / 2 = 13.47. Thats what market psychology is thinking and that is actually what's going to happen.

For now, I advise you to put SMPH on hold. This is a good thing! If SMPH and SMDC merge, they will become the largest land developer in the country (SM Land). Just hold on and don't add for now.

A few weeks ago, I was very fortunate to have been invited to talk to new friends about investing in the stock market. Thank you for the invite and I hope your investments are doing well.

This brought to mind my state of thinking when I was just beginning to invest. I remember being all excited thinking "I'm gonna be rich!". Yes...in-time.

I remember checking out stock prices everyday, and resented the fact that I didn't have additional money to add whenever the market went down.

I recall when I made my first P500 I was so happy, I bought a magnum ice-cream bar to celebrate.

But after awhile, I got so busy with work that I forgot about monitoring the stock market everyday. I also lost some excitement because of the market's slow movement. I would check the newspaper during lunch and check prices really quick. I even missed selling 2 stocks when it hit TP!

And you know whats so funny? It was at that time that my portfolio grew the most. Why? because I wasn't meddling. I wasn't stressing myself over stock prices everyday. I somewhat didn't care how my stocks were doing. I didn't move in and out of different stocks. I just let my portfolio be...

I just knew that the stocks I had at the time made me content. That those companies were solid companies and that my fretting over prices everyday actually didn't make a difference whatsoever!

Right now, I know you are feeling all those things. Checking the market everyday... wanting to add more capital when the market is down so you can buy more shares...

But forget it. Let your portfolio be. Just follow your pledge of adding capital everymonth/quarter/year and leave your stocks to grow. Whats better is you don't even need to water them!

May God bless your investments!

Playing the market

By Gus Cosio

A lot of market players are likely asking themselves if we are still in a bull market. For people who play the market by way of scalping or stagging individual stocks, price movement of the last few days can be very daunting. Anyone would be very lucky if he went long and made money. The difficulty about short term traders is they tend to chase prices both on the rise and then on the fall. The only ones who are successful doing this strategy most of the time are broker-dealers in the exchange simply because they are immersed in the stocks they trade the whole time. Also, they have no friction cost on their trade.

For the average individual, one has to be more circumspect. Investment horizons should be longer which really means one should not expect a quick profit on every trade, but be thankful for every opportunity when it happens. Today, in spite of the recent weakness in share prices, it may not be too risky to do some cherry picking provided that your investment horizon is not too short. Of course, the adage is that one should not try to catch a falling knife. Nevertheless, after this decline starts to show signs of stabilizing which to my mind it has, it would be good to be long in positions.

Yesterday's price movements were very encouraging; my view is that after a number of days of declines, the market is starting to turn. I would stick to strong rather than speculative stocks because that is where the money is going. I've always believed in following the money flow particularly in bullish trends such as what we have.

Stock Update as of March 11, 2013

The PSEI has breached the 6.800 mark.  As of this writing, PSEi is at 6,849. Here's the intraday chart.

Here's the current standing of our stocks

For those holding PNX, ex-date for the dividends is on April 5, 2013. Remain vigilant and keep monitoring this stock. Our TP for PNX is P14.9. For those who do not have PNX, DO NOT BUY anymore.

As always, Caveat Emptor!

May God bless your investments.