[Music]

hi welcome to the equities module of the

CFP program I am Durbin SSL is and I'll

be your coach for this session so in

this module you'll be learning more

about the basics of equities the

definition of a stock stock market and

the bsdi

and how can we earn from it we will also

discuss the brokers that we need in

order for us to invest in the market are

the training facilities that we can use

so that we can invest or trade in a PSD

we'll also cover some of the basic

functions are most useful functions in

Bloomberg if ever we want to study the

companies where we can invest our money

in so what is a stock stocks are shares

of ownership in a corporation so when

you buy a stock or stocks of a publicly

listed company you become a shareholder

or part owner of the company for example

you own a thousand shares of a yawl and

if you own a thousand shares of the

company you may now call Jaime Augusto

zóbel de ayala as your business partner

so since you are a business partner or a

shareholder of Ayala lon you participate

in the company's growth and future

profits conversely you may also lose if

the company suffers a loss or performs

below market expectations what is a

stock market stock market is a place

where stocks are bought and sold to

explain simply it's like a market a wet

market but this time you don't buy fish

or vegetables for consumption in the

stock market we trade ownership or

shares of stock in a company the

philippine stock market is where people

can buy and sell stocks or shares of

publicly listed companies in the PSE or

the Philippine Stock Exchange if you're

wondering who can trade stocks and how

much is the capital that we need in

order to invest in the market everybody

can invest in the Philippine Stock

Exchange so as long as a person has the

minimum capital of 5,000 to invest in

the stock market

he can be a shareholder of a listed

company some brokers though require

higher minimum capital some brokers

require at least 25,000

pesos 50 thousand pesos 100 thousand

pesos some even require five hundred

thousand or a million pesos so how do we

earn from stocks we have two ways in

order to earn from the market the first

one is capital appreciation which is the

rise in the share price of the stock

that you bought for example you bought

shares of a yellow land at 15 pesos per

share and sold it at 35 pesos so the

difference of 20 pesos is now your

profit so if ever you have 10,000 shares

of a yellow land at 15 you now have

150,000 pesos if you were able to sell

it at 35 or 350 thousand pesos

the 200 thousand pesos is now your

profit cool isn't it the next one is

dividends dividends are the portion of

the company's income that are

distributed to shareholders

for example Ayala corporation declares a

dividend of 5 pesos per share if you own

1000 shares of Al land of or of the

company you get five thousand pesos in

dividend so what are the classes of

stocks the first one is common share

comment share entitles a common

shareholder to voting rights during

annual or special stockholders meetings

most of the issues traded in the local

stock market are common stocks common

stocks are also known as ordinary shares

so the second one is preferred shares

preference shareholders have a higher

claim on assets and earnings of the

company in terms of dividend payment and

liquidation they have priority over

common shareholders preferred

shareholders have no voting rights

though but they are entitled to receive

dividends before any dividend are paid

to the common shareholders preferred

stocks are also known as preference

shares so our shares offered in the

market

the first one is primary offering or IPO

which means initial public offering so

this is the first time that the private

company will offer shares to the open

market or to the public the second one

is a secondary offering so this is an

offering of securities by a shareholder

of the company to the secondary market

which is the PSE have you ever wondered

why companies offer shares in the market

we have two reasons why companies offer

shares to the public the first one is to

raise capital for business expansion for

the growth of the company the second one

is to raise money to settle financial

obligations or debt to the company's

lenders so if you're planning to invest

in the market when can you start trading

so the market faces in the PSE starts at

9:00 a.m. so what are the market faces

in the PSE the pre-opened state of the

market starts at 9:00 a.m. until 9 29

a.m. at 9:30 the market opens from 9:30

until 12:00 noon the market is in

continuous trading meaning you can trade

as many stars as possible you can trade

any stock possible as long as they are

listed in the PSE buy you can sell in

the open market at 12:00 noon to 1:30

p.m. market enters into the recess state

brokers during this time take their

lunch take the rest take naps so you

cannot trade in the open market during

this time at 1:30 the market resumes and

that lasts until 3:15 in the afternoon

so during this time market participants

can trade any stock listed in a PSE the

pre closed state of the market starts at

3:15 p.m. so this means that people or

traders or market participants can post

their orders in the market but the PSE

will not match it

not until 3:20 p.m. which is the run off

or trading at last face of the market

market run off or trading at last state

starts at 3:20 p.m. this is the time

that the PSE matches all orders posted

from 3:15 to 3:19 p.m. so this is the

time that the PSE determines the closing

price of a stock in the market and then

at 3:30 p.m. the market closes so how

are stocks traded in the market so the

buyer

places the order through the broker and

then the broker sends the buy order to

the PSE meanwhile the seller or the

selling investor places the sell order

through the stock broker and then the

stock broker sends the sell order to the

PSE so the role of the PSE in the market

is to match the buy and sell orders of

both parties the PSE then execute the

order and sends the confirmation to the

stock broker the stock broker then sends

the confirmation from PSE to the

investor and then the investor now

receives the confirmation that his order

is now executed so what is the PSE I so

the PSE I or the Philippine Stock

Exchange index is a basket of stocks

used as a benchmark to represent the

overall equities market of the country

or of the Philippines so basically the

PSE eye is our barometer for the

Philippine market so what is the PSE eye

the PSE eye or the Philippine Stock

Exchange index is a basket of stocks

used as a benchmark to represent the

overall equities market of the country

the PSE eye is composed of 30 companies

and they are called blue chip stocks

they are called blue chips because they

are deemed stable companies in the

Philippine market they are also some of

the biggest and most valuable companies

in the Philippines what are the

characteristics of listed stocks in the

PSE the first one are the blue chip

stocks blue chip stocks are well

established and financially sound

companies the second one is income stock

or companies with good dividend payment

history due to steady profits the third

one are growth stocks these are

corporations whose earnings are expected

to grow at an above average rate

relative to the market

the fourth one defensive stocks

defensive stocks remain stable under

difficult economic conditions like

recession deflationary economy or market

turmoil these are stocks of food oil and

utility companies the fifth one

cyclicals stocks these are companies

that are sensitive to business

conditions or cycles

strongly tied with economy's performance

the last one speculative stocks it

increases or decreases rapidly depending

on the economic conditions so if ever

you start investing or trading in the

market how much can you earn or loose

the answer is it depends some earn

double in a short span of time

while some loose in a matter of days the

golden rule to remember is buy low sell

high if you're wondering how many shares

can you purchase in the market you have

to know the board lap table first the

board lab table determines the minimum

number of shares one can purchase or

sell at a specific price range

the minimum amount needed to invest in

stocks varies and will depend on the

market price of the security as well as

its corresponding board lot so this is

how the board lap table looks like as

you can see the minimum number of shares

that you can purchase depends on the

price range of the stock price so for

example Ireland is trading at 40 pesos

the price range of a lln falls from the

price range of 20 pesos to 49.95 cents

so the minimum fluctuation in price is

point zero five and the minimum number

of shares that you can buy or sell is

100 shares so if you're buying at 40

pesos at 100 shares you'll have to shell

out at least 4,000 pesos to become a

shareholder of

Ayala lon so what are the orders

according to validity the first one is

they order which is valid until at the

end of the trading day only so if you

post a buy order in the morning and the

share price of the company do not go

down to your buying price the PSE will

automatically cancel your day order the

next one is good till cancelled if you

bought a stock at a relatively low price

and you expect the price of the company

to increase at a specific price in the

future you can post your sell order at a

higher range so GT C or good

cancelled order is valid until cancelled

by the investor or trader

meaning if you do not cancel your order

or sell order it will remain posted in

the market forever the next one is good

till date order or GTD order which is

valid until the date specified by the

investor if you bought a stock at a low

price and you decide to sell it seven

months from now you can use the GTD

order to set the specified date the last

one is good till week order or the GTW

this is valid only for seven calendar

days so now that you know the definition

of the stock market

I assume you are wondering how many

companies are listed in the PSE if you

look at Bloomberg we can type P a sh r

or the Philippine Stock Exchange all

share index in the command bar to see

the main menu where we can check the

number of shares or companies listed in

the PSE

so when you arrive at the main menu of

the Peshawar index just click M e MB or

member weightings and then the terminal

will now show you the number of

companies listed in the oil shares index

we have more than 200 companies listed

in the market see how you have a lot of

options to choose from our market is

also divided in various industries so we

have the holdings firm we have the

industrials we have the properties we

have the services we have the financials

we have the mining in oil just click

this button if you want to see the full

list of companies under the Holding

firms sector so we have s/m Investments

Alec or JG summit and so on how about

the Philippine Stock Exchange index how

would you know the companies that are

considered blue chips

go here in the amber box just type PS II

I which stands for the Philippine Stock

Exchange index and click the result now

Bloomberg will show you the companies

that are considered blue chips so we

have s/m I Allah digi summit a boy this

equity ventures AGI LTG DMC I we also

have some companies under the property

sector these are some of the biggest

property companies in the Philippines I

had a land SM prime mega world Robinsons

land if you're planning to invest in the

banking sector you can choose from the

four companies under the sector we have

BDO BPI Metro Bank and Security Bank you

can also choose from the industrial

sectors or the services sector if you're

a fan of mining in oil just click this

button and then you'll see samurai

remaining and Power Corp under this

sector if you're wondering how many

brokers are there in the PSE you can go

to the website of the PSE by typing PS e

that calm that pH and then go to the

trading participants button click the

directory to see the full list of

brokers a graduated by the PSE so in

this page you'll see all the active

brokers that you can use the trade in

the market so by clicking this button

you'll see the other options or brokers

where you can open an account now that

you know the two ways to earn from the

stock market let me give you an example

of how to earn from capital appreciation

so let's use double dragon properties as

an example my typing dee dee let us

choose double dragon properties under

the securities section let us go to GP

or line chart to see the chart

performance of the company we're going

to go back three or four years ago when

the stock traded from ten pesos or below

ten pesos to as high as 80 pesos so

let's change the chart type

imagine Double Dragon was just trading

around two pesos in April 2014 if you're

able to buy this company during this

time and held on to it within two years

of holding the company you would have

earned around three thousand two hundred

percent in return so this is an example

of capital appreciation what if you were

able to buy at ten it was trading at ten

in August 25 2015 if you're able to buy

a during this time let's check how can

how many profit can you or would you

have earned from this time so ten pesos

let us drag it until 80 you would have

earned six hundred percent in less than

a year so isn't that exciting imagine

yourself investing at least a thousand

shares or five thousand shares or ten

thousand shares bought at ten pesos per

per share if you held on to it within a

year your 10,000 shares would have

earned around six hundred percent so

that's a lot of money another one let us

use a blue chip stock let us open our

land

if you're a long-term investor you can

choose a ll and as your choice so let us

assume you were able to buy a other than

that 15 and held on to it until up to

this day so let's check how many how

much return would you have earned if you

held on to it so from 14 until 43 today

you would have earned one hundred

eighty-five percent

in return so that's the power of capital

appreciation in long-term investing but

how about dividends if you plan to

invest in the long-term and expect to

earn from dividends you can type DVD in

the command bar and open this function

this window is where you can see the

dividends per share that the company

will distribute to shareholders so for

Al and the plan or they are forecasted

so for Al and they are projected to give

or distribute 0.265

cents of dividends per share to investor

by next year or the first quarter by

going to DES or security description by

clicking the issue information tab

Bloomberg will show you what kind of

security were you able to buy in the

market so the ticker code with Ali p.m.

equity or Al I in the PSE is considered

as or classified as a common stock so

how would you know if there is a company

that will do or kind of an IPO in the

market you can type IPO or initial

public offering or equity offerings in

the command bar open the IPO function

and then Bloomberg will show you the

companies that have done or conducted

their IPOs recently or those companies

that are planning to do their IPOs in

the future so now that you know the

Borla table what function can you use in

the Bloomberg to see the minimum number

of shares that you can purchase in a

particular company we type in DES or

security description the terminal win

will now show you the minimum number of

shares that you can purchase for example

in Iowa lon so we need at least 100

shares to be able to become a

shareholder of this company

so now that you know the basics about

the stock market

I assume you are wondering what function

can we use to analyze a particular

company listed in the PSE so for example

let us navigate a Allah land by typing a

li and choosing a Li p.m. equity or a ll

and Inc Philippines the terminal will

show us the main menu for this company

so we'll be focusing on the company

overview company analysis research and

estimates comparative analytics and

charting and reporting the first one

company overview this is where you will

see the basic information about the

company so the first one is security

description so this function will show

you the basic information about the

company so you'll see the snapshot about

the company or the firm or the stock in

this section you will see the estimates

in this section you'll see the dividends

so indicative gross yield of Ayala land

is at one point 17 percent the five-year

growth rate of Ayala land is 11 point 58

percent the price change of the company

right after the trading this afternoon

was one point sixty five percent higher

than the closing price yesterday you'll

also see the 52-week high and 52-week

low of the company for the past twelve

months you can also see some basic

information in the issue information tab

like the type of security that is used

to know if the company's common stock or

a preferred one or preferred stock we

also have a ratio tab here where you can

see the basic ratios or price multiples

that investors can use to make sound

investment decisions

or if they are planning to invest in the

company for the long term we also see

some figures in revenue and EPS tab so

you can see here that Bloomberg provides

forecasts for companies or covert

companies we also have the revenue and

EPS tab where you can see the forecasts

of Bloomberg for the profitability of

the company in the next coming years and

of course we have the industry

information where some of the

information that you can use for sector

analysis can be found the next one is CF

or company filings so in this function

you'll see the latest disclosures of the

listed firm so usually they disclose the

quarterly report company presentations

circulars prospectus and other documents

that are released or published for

public consumption the next one is CN or

company news in this function you'll see

the latest news about the company you

can also use this to filter news about a

particular keyword that you can or you

want to read based on various articles

so for example I'm typing Trump if I

would like to read more news about Trump

I'll just press ENTER and then Bloomberg

will show me all the articles where

Trump has been mentioned so it makes

research easier you don't have to open a

lot of websites in order to read news

about Donald John Trump the next one

company analysis

fa or financial analysis is one of the

most useful functions in bloomberg if

you're planning to look for the

financial statement of a particular

company you can go here in a financial

analysis function and click the

different tabs present in this window so

for example we're checking the income

statement of the company especially if

you would like to check the

profitability of this firm by scrolling

down let's see the net income available

to common shareholders here so these are

these figures are or have been sourced

out from the companies so here we can

see that Ireland has been profiting for

the last five years seven billion in

2011 eight point nine billion in 2012 11

billion in 2013 14 billion in 2014 17

billion in 2015 20 billion in 2016 25

billion in 2017 and so far for 2018 they

have already profited 29 billion so for

2018 December the company is projected

to earn 29 point or 29 billion and 66

million pesos and for 2019 they are

projected to earn thirty three billion

pesos so financial analysis or FA

function is one of the most useful

functions in Bloomberg so this is where

you can find the several financial

statements of the company so for example

your if you're browsing the income

statement you can see here the net

income report of the company so for

example if you're looking at the trend

of the profitability of the company you

just hover here so in 2011 they earned

seven billion eight billion in 2012 11

billion in 2013 and so on in a fee or

financial analysis function you can also

see the projected income of the company

which is called which is in color gray

however if you do not like to see the

figures in a table format just go here

you can click this button to see the bar

graph illustration of the figures so it

makes things easier to understand this

is better for presentation purposes in

your office you can also see here the BS

or balance sheet tab the cash flow tab

you can also see the ratio stabbed so in

ratio so you do not have to or you do

not need to compete for the ratios or

price multiples of the company if you're

wondering how Bloomberg arrived at these

figures just click on the figure by

clicking on the figure Bloomberg will

show you how they calculated for the

figure so by clicking this button you'll

know the figures or numbers that were

used by Bloomberg to compute for the

ratio that he opened

so there are a lot of numbers in here

and Bloomberg makes the work easier by

providing gracious for you so the next

one is ownership summary so this one is

the function that will show you the

current list of shareholders of the

company so for example the biggest

shareholder of a yellow land is Ayala

Corp or a yellow corporation it owns 46%

of the company and the number of shares

that it owns or a other corporation owns

in a lowland a six point nine billion

shares you can also he see here the

insider transaction tab if you open this

one you'll see some red and green tags

in the chart or line chart of the

company this red and green tags or flags

are transactions of the insiders red

flag means that an insider or a top

management of the company sold shares

the green flag on the other hand means

that an insider of the company a top

position holder of the company has

bought shares next one the CRP are the

CRP are or credit rating profile shows

you the credit rating grade for the

bonds that the company has issued so for

a Ala lon

the bonds that it issued has received a

PRS triple-a rating next one in research

and estimates one of my favorite

functions is the EE or earnings and

estimates in this function will be able

to see the projected earnings per share

trend or earnings per share forecast in

the next two to three years so for a ll

and the company is projected to earn or

profit in the next

years so if you're planning to invest in

the long term I think Ireland is a good

choice

next is the BRC or research portal if

you're still struggling in analyzing

companies and if you're curious about

the reports that other brokers or

analysts are publishing for their

investors you can go to the research

portal or BRC function to see the

reports of various brokers for AOL and

so for example if you open this one so

this is a report made by SBI equities or

Security Bank equities the author of

this report is Gigi Velasco so by

opening the link you'll see the PDF file

or the report of the analyst where he or

she makes his opinion about the company

so for a island SP equities gave a buy

recommendation so they are still seeing

a 20 percent upside for the company so

since the company the company's stock

price has traded at forty three point

twenty today the target price is at

fifty pesos which is equivalent to

twenty percent we will be able to see

their analysis for the company and why

they like the company next one

the EQ RV function so you use this

function if you want to compare the

company that you're studying to its

competitors in the market so we compare

the price multiples of the company in

order to know if the company that you're

studying is cheap enough or expensive

enough in the long term or in the short

term so this one for example a Leland's

price to earnings ratio is trading at

twenty one point nine times while the

median is only trading at eighteen times

so since the p/e ratio of the company is

higher than the median it means that

Ireland is a bit trading at a premium or

a bit expensive than the industry

average RV or the relative valuation

function does almost the same purpose so

in RV will also see price multiples that

we can use to value or to assess if the

company is expensive or cheap so you can

compare a ll and versus its competitors

in the same industry so Robertson's land

SM prime mega world

whistlin so you can see some price

multiples here so if the average using

the BI peers or Bloomberg intelligence

peers is at seventeen point sixty three

percent and if Ayala Land spear ratio is

at our current p/e ratio is at twenty

two point fifty seven percent it means

that Ireland is more expensive than

Robinson's land whose speed ratio is now

trading at twelve point eighty four

percent however if we compare a Allen's

p/e ratio to SN Prime's and some prime

Holdings or s mph is trading at a higher

valuation which is at thirty three point

forty six times p/e ratio so the

cheapest of them all is Vista land and

life escapes whose PE ratio is now

trading at six point sixty nine percent

so remember the higher the p/e ratio the

more expensive the stock if the p/e

ratio is low or the lower the p/e ratio

it means that the stuff is expensive

next one is the GP function or the line

chart so this is the function that we

use to chart the stock price of the

company

this is what we use for short-term

trading so this is where we will see the

historical chart performance of the

company we have the annotate button here

if we click this one Bloomberg terminal

will show you the pilot where you can

see the different tools that you can use

to draw lines and segments or trend

lines to analyze the chart movement or

price movement of the stock can also use

these tools to analyze if the trend of

the stock is still strong or a bit

weaker we also have a button here called

news analytics so if we click this one

and choose a date or a specific date in

the past for example I'm clicking on

November 28th 2017 or 28 2007 t so if

you click on this date Bloomberg will

show a smaller window that contains the

news that happened or the news that were

fetched by Bloomberg during that day so

on November that year in 2017 these were

the news that were collected by

Bloomberg in this way you can go back in

a specific time in the past and look for

the catalyst that moved the market

upward or downward and then the last

function is the GF or graph fundamentals

you use this one if you want to chart

financial ratios of a particular company

you can also use this one to compare the

price multiples of a particular company

against its competitors in the same

industry so for example let us load

Robinson's LAN or our LC let us load

mega world and as M Prime Holdings so if

you are confused which one to choose or

to invest in you can compare their

profitability or p/e ratio in order to

know which company is the cheapest or

most expensive so let's start with the

p/e ratio so if you click this one

Bloomberg will show you the p/e ratio of

each company to make the presentation

better you can click the single panel to

combine all the four windows so it

appears that SM Prime is the most

expensive of the four the second was al

Allen whose pH is trading at 22 times P

ratio the cheapest of them all is mega

world whose pH is trading at 10.95 times

P ratio so by using this price multiple

and using the graph fundamentals or GF

function you get to see which company is

trading at a premium or trading at it's

a cheap valuation you can also click the

fields button or it breathe in this

button you'll see a lot of price

multiples that you can choose or you can

graph in the GF function so for example

revenue if you click this one GF will

now show you the graph of the revenue

trend of the companies listed in this

section raise the price to earnings

ratio to see it revenue trend clearly

revenue by a lowland amounted to 37

billion RLC netted 8 billion mega world

earn a 12 billion while SM Prime

Holdings earned 24 billion in revenue

these are all for the third quarter

period so click this one again if you

would like to see the old fields or

complete list of price multiples that

you can graph in the GF function you can

click the oil fields button you can

choose from here clicking the drop-down

buttons you have a lot to choose from a

lot of price multiples that they can use

to analyze the companies that you can

all really like to invest your money

into so these are the basic and most

useful functions for a company that

you'd like to analyze if ever you're

planning to invest in a company so now

that we have discussed some of the most

useful functions in equities I'll be

giving you a short quiz I hope that

everyone passes the short quiz and I

hope to see you soon thank you

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