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Five potentially higher-yield investments in the Philippines

account_balanceMetro News account_circleJames Lopes chat_bubble_outline0 Comments

If you are interested in making higher-yield investments in Southeast Asia, you may wonder what options are available in the Philippines, a leading country in the region.

Don’t lose hope because the question of what is yield in stocks and others will be handled here. When considering higher-yielding investments, the best approach is to start with a thorough analysis of the market. How was it in the past, and what are the indications for the future? Such questions will help you determine where to invest in this market.

Current Investment Activities in the Philippines

The Philippines is referred to as an emerging Asian Tiger for its booming economy. Low operating and labor costs coupled with an expanding middle-class are some of the biggest enhancers of economic growth here.

Where are people investing in the Philippines?

The Fast-moving consumer goods (FMCG) sector is growing fast and attracting investors in the Philippines. Consumer demand for dairy products is steady, thus offering a strong appetite in the stock market. Note also that e-commerce is rising fast here. Consumers are looking for convenience and friendly prices, and these factors were crucial during the seceding pandemic.

Investors are also looking at the real estate sector, particularly what they call Real Estate Investment Trusts (REITs). Commercial and rental spaces are in high demand as the outsourcing industry in the Philippines is booming. The digital transformation experienced across the globe has given rise to the need for outsourced services, hence these spaces are popular. REITs are exciting investment opportunities, as evidenced by the performance of Ayala Land and others.

Investments in the manufacturing sector are also high, enhanced by factors such as the ‘Build, Build, Build’ program from the government and foreign investments from different quarters. Statistics show that a quarter of the gross domestic product in the Philippines is from the manufacturing sector.

Importance of Yield in Stocks Trading and Others

When the income of an investment is viewed over time, it is referred to as yield. You calculate the yield of investment by dividing dividends or interest earned during a particular time by the value of the investment. There are various forms of yield including rental property, stockholding yield, and bond yield.

If you are an income investor, chances are that you are dependent (wholly or partly) on the income from your investment. For such an investment, yield is a critical factor. If for instance you have stocks, and you expect to cover your expenses with the income, do your math to guarantee earning sufficiency.  

Five Potential Higher-Yield Investments in the Philippines

To help you make the right choice, here is a rundown of five potential high-yield investments in the Philippines:

1.  High-yield Savings Account: Even as you look for a high-yield investment, sometimes you want it to come with safety and simplicity. That’s what this option offers. Typically, the institutions are secure and already established so the risk is next to zero. Your money may not grow as steadily as the other options, but you may consider this investment as high-yield.

2.  Time Deposit: For an even higher yield but with the same security level, consider a time deposit investment. Depending on the maturity period, the interest can range between 0.25% and 2%. Note that withholding tax applies for time deposits.

3.  Stocks: Truth be told – investing in stocks is accompanied by higher risk. However, the yields are too enticing. As long as you invest smartly, stocks will rarely disappoint.

4.  Mutual Funds: This investment option is ideal for investors who are unwilling to take a lot of time researching on their own.

5.  Insurance: Contrary to what many Filipinos think, insurance is not just a remedy for emergencies; it can be a higher-yield investment nowadays. If you pick the variable universal life insurance (VUL), it means that your policy is also an investment.

Conclusion

Regarding investing in the Philippines, it is just like anywhere else – no size is a fit for all. The most basic requirement is for the investor to define the reason(s) for investing. In line with Marvin Fausto’s popular saying, choose your higher-yield investment in the Philippines having outlined your goals.


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