The Basics of Stock Trading in the

Philippines
Why are we here?
Did you know?

<1%
of the population invests
in the stock market
Misconceptions about stock market
investing…
What is Stock Market?

It is the place where the buying and selling of

of publicly-listed stocks takes place.

PSE Ortigas Trading Floor PSE Ayala Trading Floor

What are Shares of Stocks?

• It represents the ownership of the

company’s assets and profits.
• Simply put, being a shareholder
makes you a part-owner of that
particular company.
• More shares = more ownership in the
company.
• 265 companies listed in the
PSE as of 2016.
Stocks According To Sectors
Financial Sector

Industrial Sector

Holding Firm Sector

Stocks According To Sectors
Property Sector

Services Sector

Mining And Oil Sector

Classification Of Stocks
Blue Chip stocks
Are shares of well-established and financially sound companies that have
demonstrated their ability to pay dividends in both good and bad times. They also
exhibit more modest but dependable returns and are relatively of lower risk.

Income stocks
Are shares of those companies with good dividend payment history due to steady
profits. Since they are stable, income stocks generally have a lower level of
volatility.

Growth stocks
Also called “glamour stocks”, are shares of corporations whose earnings are
expected to grow at an above-average rate relative to the market. A growth stock
does not usually issue dividends as earnings are reinvested in capital projects.
Classification Of Stocks
Defensive stocks
Are shares that provide regular dividends and stable earnings, regardless of the
overall condition of the stock market. Remain stable under difficult economic
conditions. These are stocks of food, oil, and utilities companies, which are
characterized by steady demand amidst hard times.

Cyclical stocks
Are those sensitive to business conditions or cycles strongly tied with the
economy’s performance. Companies produce or offer services that are low in
demand during slowdown and increase when business peaks.

Speculative stocks
Rise quickly when economic growth is strong and falls rapidly when growth is
slowing down. Considered very risky because of its volatility.
What is the PSE?
a self-regulatory organization that provides and
ensures fair, efficient, and orderly market for buying
and selling stocks of publicly listed companies.
What is the PSE?
1927 - The Manila Stock Exchange, Inc. (MSE) was established on August 8, 1927 by five
businessmen, namely, W. Eric Little, Gordon W. Mackay, John J. Russell, Frank W. Wakefield
and W.P.G. Elliot.

1963 - The Makati Stock Exchange, Inc. (MkSE) was organized by Hermenegildo B.
Reyes, Bernard Gaberman, Eduardo Ortigas, Aristeo Lat and Miguel Campos on May 27, 1963.

1992 - The Philippine Stock Exchange, Inc. (PSE) was incorporated on July 14, 1992 by the following
incorporators: Robert Coyiuto, Jr., Victor Say Hipek, Eduardo C. Lim, Juan B. Francisco and
Cesar E.A. Virata. On December 23, 1992, MSE and MkSE forged and issued a joint
declaration on the unification of the country's two bourses under the Philippine Stock
Exchange, Inc. to consolidate logistics and hasten development of the capital market.
What is the PSE?
COMPOSITION

265 listed companies (Stocks)

186 Issued rights for Brokerage Companies | Trading Participants

135 Active Brokerage Companies
21 Brokers with Online Trading Platform
3/24/2017
3/24/2017
 Do
your
homework
first!
Personality Check
 Establish wealth mindset - Determine how much
success you’ll be welcoming into your life.

 Steady source of income - If you think your income

is too low, then your best move is to focus on
increasing your income first.

 Budget wisely - If you don’t know how to budget,

you won’t know how to save. And if you don’t know
how to save, it is impossible for you to invest.

 Know the risks - Risk is an integral part of investing.

Generally speaking, it is the counterbalance to return.

 Know your financial goals – You must select the

appropriate investments base on your goals
A View Of Time In Financial Goals
Short term goals – time span up to 12 months: These goals are aligned with
more immediate needs such as the running of a household and planned
expenditure within that period.

Medium term goals – time span one – five years: This could include large
purchases or investments that deliver returns within this period.

Long term goals – time span five years and more: These goals typically secure
one’s financial future, e.g. retirement planning and long term investments.
Then start the learning journey…

FUNDAMENTAL ANALYSIS
Fundamental analysis is the examination of
the underlying forces that affect the well
being of the economy, industry groups, and
companies.
 How Warren Buffett chooses a great stock in 4 steps

A stock must be stable

A stock must have
and understandable
long term prospects

A stock must be
A stock must be managed undervalued
by vigilant leaders
Factors Affecting Stock Price Movement

World Events

Natural Disasters Economic Growth

Company News Stock Price

Hype

Supply & Demand

Politics
 Stocks In Your Everyday Life

PNX, PCOR, SMC,

MPI, GTCAP

AC, MER, EDC, MPI, SM, ALI, AGI, MEG,

GTCAP, SMC, DMC, SSI, JGS, PGOLD,
URC, AGI, DMPL, DD, RLC, SMPH,
PF, CNPF, AP, MWC RRHI
 Stocks In Your Everyday Life

AC, ALI, CPG, FLI,

FDC, SMPH, RLC,
JGS, MEG, AGI,
CEB, PAL, RWM,
BLOOM, MCP, PLC,
BEL, LR

ABS/P, GMA7, AC,

HOUSE, HLCM, LRI,
TEL, GLO, GTCAP,
DMC, CROWN
BPI, BDO, SM, MBT
When is The Best Time To...

BUY? SELL?
TECHNICAL ANALYSIS
• The study of price movements primarily through the use of
charts for the purpose of forecasting future movements.

• The study of the shifts between the forces of demand and

supply in relation to price movements.

• Uses charts to determine the psychology and behavior of the

market towards price.
 Benefits
• Able to identify the right entry (buy) point.
• Able to identify the right exit (sell) point.
• Become a better trader/investor with
better trading strategy
• Able to minimize losses and maximize
profits
• It can help manage your emotion in your
trading
Support & Resistance
Resistance

Support
NOW LET’S START TO SHOP….
 PSE Composite Index (PSEi)

 Fixed basket of thirty (30) common stocks of listed companies

 Carefully selected to represent the general movement of the stock market
 Benchmark measuring the performance of the Philippine stock market

Three criteria for the company to qualify for PSEi

 The company’s free float level must be at least 12%

 The company must rank among the top 25% in terms of median daily value
in nine out of the twelve-month period in review
 Ranking of TOP 30 qualified companies based on full market capitalization
 Free
52 Week 52 Week
No. Security Name Symbol Float
High Low
Level %
1 AYALA CORPORATION AC 40 908.00 600.00
2 ABOITIZ EQUITY VENTURES, INC. AEV 46 84.40 52.50
3 ALLIANCE GLOBAL GROUP, INC. AGI 42 19.00 12.60
4 AYALA LAND, INC. ALI 52 42.15 27.20
5 ABOITIZ POWER CORP. AP 19 49.00 38.40
6 BDO UNIBANK, INC. BDO 45 119.50 93.05
7 BANK OF THE PHILIPPINE ISLANDS BPI 48 107.90 80.00
8 DMCI HOLDINGS, INC. DMC 28 14.10 10.62
9 ENERGY DEVELOPMENT CORPORATION EDC 49 7.02 5.15
10 PUREGOLD PGOLD 33 49.80 36.00
11 FIRST GEN CORPORATION FGEN 33 27.00 17.60
12 GLOBE TELECOM, INC. GLO 22 2496.00 1650.00
13 GT CAPITAL HOLDINGS, INC. GTCAP 45 1635.00 1210.00
14 INTERNATIONAL CONTAINER TERMINAL SERVICES, INC. ICT 51 88.50 55.00
15 JOLLIBEE FOODS CORPORATION JFC 43 260.00 185.50

Listing as of March 13, 2017

 Free
52 Week 52 Week
No. Security Name Symbol Float
High Low
Level %
16 JG SUMMIT HOLDINGS, INC. JGS 41 95.25 56.90
17 LT GROUP, INC. LTG 26 17.98 9.79
18 METROPOLITAN BANK & TRUST COMPANY MBT 50 97.90 67.30
19 MEGAWORLD CORPORATION MEG 34 5.51 3.00
20 MANILA ELECTRIC COMPANY MER 19 355.00 289.40
21 METRO PACIFIC INVESTMENTS CORPORATION MPI 48 7.60 4.80
22 PETRON CORPORATION PCOR 24 11.96 5.22
23 ROBINSONS LAND CORPORATION RLC 39 34.00 22.80
24 Semirara Mining and Power Corporation SCC 27 143.00 95.50
25 SECURITY BANK CORPORATION SECB 60 253.00 130.40
26 SM INVESTMENTS CORPORATION SM 46 1030.00 653.50
27 SAN MIGUEL CORPORATION SMC 15 86.10 43.90
28 SM PRIME HOLDINGS, INC. SMPH 32 31.00 18.70
29 PLDT Inc. TEL 50 2430.00 1621.00
30 UNIVERSAL ROBINA CORPORATION URC 44 219.80 170.00

Listing as of September 22, 2016

The following is the complete list of Filipinos
in the 2017 Forbes World's Billionaires List:

Name Global Rank Net

worth
Henry Sy 94 $12.7B
John Gokongwei Jr. 250 $5.8B
Lucio Tan 501 $3.7 B
George Ty 544 $3.5B
Enrique Razon Jr. 564 $3.4 B
Tony Tan Caktiong 564 $3.4 B
David Consunji 630 $3.1 B
Andrew Tan 814 $2.5 B
Robert Coyiuto Jr. 1376 $1.5B
Manuel Villar 1376 $1.5B
Ramon Ang 1468 $1.4 B
Eduardo Cojuangco 1678 $1.2 B
Roberto Ongpin 1795 $1.1B
Edgar Sia II 1940 $1.0 B
Board Lot Price Range
 1. Capital Gain / Price Appreciation
A rise in the value of an asset based on a rise in market price. Essentially, the
capital that was invested in the security has increased in value, and the capital
appreciation portion of the investment includes all of the market value exceeding
the original investment or cost basis.

Date 2011 2012

Number of 1000 shares 1000 shares

shares

Price per Php 20/s Php 26.60/s

share

Total Php 20,000 Php 26,600

Php 6,600
 Price Appreciation
Php285.20/s
September 2015

1,901%
Growth Rate

Php14.25/s
August 2005

This illustration using specific issue or security

does not constitute a recommendation to buy or sell.
 Price Appreciation
Php82.80/s
September 2014

1,004%
Growth Rate

Php7.50/s
June 2009

This illustration using specific issue or security

does not constitute a recommendation to buy or sell.
 Price Appreciation
Php1,200/s
May 2013

610%
Growth Rate

Php169.00/s
December 2008

This illustration using specific issue or security

does not constitute a recommendation to buy or sell.
 Price Appreciation
Php48.15/s
May 2014

351%
Growth Rate

Php10.68/s
October 2011

This illustration using specific issue or security

does not constitute a recommendation to buy or sell.
 Short Term Trading

3/24/2017
 What’s the news effect?

488%
Php 90.00
July 10, 2014

In less than 5 months!

Php35.00
March 4, 2014

54% Gain in 16-days

Php15.30 Php23.50
February 26, 2014 March 12, 2014
 Dividends
A dividend is a distribution of a portion of a company's earnings, decided by the
board of directors, to a class of its shareholders. Dividends can be issued as cash
payments, as shares of stock, or other shares of other stocks.
Price Appreciation & Dividends
Case Study: URC
Bought 1,000 shares of URC last February 4, 2010
@ Php17.50 / share
Total Investment = Php17,500.00

Price of URC last February 4, 2015 = Php206.00/share

Cash Dividend
(May 3, 2012 @ Php1.50/ Share) = P1, 500
(May 3, 2012 @ Php0.40/ Share Special dividend) P 400
(May 7, 2013 @ Php1.50/ Share) P 1,500
(May 7, 2013 @ Php0.90/ Share Special dividend) P 900
P 4,300
Php206.00 x 1,000 shares = Php206,000.00

Php 206,000 – Php17,500.00 = Php188,500.00

Total Cash Dividend + Proceeds from Price Appreciation = Php192,800.00

1,002% ROI
 Is
it
Risky
to invest
in
Stock
Market?
 There is no such thing as a risk-free
investment – all investments, including
those that are guaranteed to return
principal, carry some sort of risk. However,
the greater the amount of risk that an
investor is willing to take on, the greater the
potential return.
How To Minimize Risks In Equities?

1. Research your investments

• Research for the value of the company you
want to invest in; its earnings and dividends;
its market capitalization; or its institutional
ownership.
• Follow industry news. This will help you
anticipate various factors that make affect the
company’s performance.
 How To Minimize Risks In Equities?
2. Diversify
• It is safer to buy several different stocks
rather than concentrating all of your funds in
few stocks to avoid the impact of poor stock
choices.
• Diversify into more than one industry.
 How To Minimize Risks In Equities?

3. Invest over a long time

• You can get a better
return on your
investment when your
money is invested over
a long time.
• If you can regularly
monitor the market and
get a better grasp of it,
then you can try to
invest in the market
over a short period of
time.
 How To Minimize Risks In Equities?
4. Invest on knowledge
• Knowing the basic fundamental and technical know-
hows of the stock market allows you to make informed
and wise decision in your trades.
• These tools can help you determine the right timing
on when to cut losses and/or minimize your gains.
• Avoid transactions through panic; keep your emotions
under control.
• Do not fall in love with your stocks. Learn to let go
and stick to your trading plan.
 How To Minimize Risks In Equities?

5. Create & Maintain a Trading Diary

• Maintain a record of all your transactions and
have a thorough understanding of your portfolio.
• Learn from wrong decisions
“The single difference between success and failure,
between gain and loss boils down to only one
word… KNOWLEDGE”
 Trading Role Play

Stock Symbol - X
Closing Price as of March 24, 2017 –
9.90 / share
52 Week Low 7.09
52 Week High 20.00

3/24/2017
MAKE THE RIGHT CHOICE.
TRADE WITH A COMPANY
YOU CAN TRUST!
 Philstocks Financial, Inc.
has been in the industry for 14 years now…

A respectable brokerage house listed

under the Philippine Stock Exchange

With unimpaired capital of Php 125M,

the first ever in the history of PSE to comply
SEC ruling 128-1

Ranks no. 25 among the nearly 200 stock

brokerage houses in the Philippines with over
Php 60B total value traded for year 2015
State of the art online
trading platform

Fast execution of
orders

Convenient online
funding of account
 With as low as Php5,000
minimum initial investment,
you can already make money
on money through the stock
market.
Mobile
3 Easy Steps To Open A Trading Account
Step 1:
Register at www.philstocks.ph
Step 2:
Complete your requirements and
deposit your initial investment.
Step 3:
Once activated, log in to your
account and you are now ready to
trade!
3/24/2017
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 REACH US!

Website: www.philstocks.ph
Email: info@philstocks.ph

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(02) 5881900
09228052554
3/24/2017