Philippine Stock Market is Number 1 in the World

We are Number 1 in the World!

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I would like to begin this article by applauding the stellar performance of the Philippine Stock Market during the 1^st half of 2012 (January to June period) posting a year to date return of 19%. Moreover, we should be extremely proud of the fact that in the global arena, our Philippine Stock Market has been able to put up the greatest show in comparison to the biggest stock exchanges in the Americas, Europe and Asia. The below table will show that we are the number 1 stock market in the world as against other exchanges considered as giants such as the US Dow Jones, NASDAQ, German DAX, Japan Nikkei and no other than China’s SSE:

 

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Being aware of the above numbers does not only make me proud as a citizen of our country but significantly as an investor, I have been always a firm believer that the most reliable indicator of the economy’s future performance is the stock market as it usually foretells what will happen to our economy in the next 6 to 12 months. That is the reason why my favourite companies have been gaining steam as well. Below is a ranking of my favourite companies and their YTD returns:

What the above numbers tell me is that barring any black swans or cataclysmic events like if all of a sudden a coup d’ etat ensues, another nuclear scare pops out of the picture or the entire Euro zone crumbles into recession, the Philippine Stock Market and the above companies will still outperform other markets and the above companies will continue to remain profitable. As a matter of fact, from January 2012 to June 2012, we were in the middle of various economic and fiscal crises such as the PIGS (Portugal, Italy, Greece, Spain) debt crisis, poor manufacturing data in China and the ever-increasing jobless rate in US. And yet, our country has remained resilient as manifested by the positive corporate and government performance and growth numbers.

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 The only question that I have in mind is why some of us are still on a “wait and see” mode. Foreigners are buying Philippine stocks and mutual funds and yet many locals are still putting most of their savings in banks. I am not disparaging banks but I personally believe that banks are good for short-term liquidity only, meaning, for your 6-12 monthly household expenditures or emergencies. If you have a medium to long-term time horizon, a greater portion of your retirement should be placed in long-term assets such as the stocks and mutual funds for capital growth.

I will be discussing on my next article why the slogan “It is more fun investing in the Philippines” would still hold true in the coming years. Meanwhile, may your investments continue to grow and if you have not yet started, you may contact me at anselmreyes@yahoo.com for tips and advice.

Thank you for reading this article and I hope you will share the knowledge with your family and friends.

Anselm Reyes

PS. Email me your thoughts, comments, suggestions and questions at anselmreyes@yahoo.com and for any concerns that you may have about financial literacy and investing.

For free stock market investing tips, click here http://investingphilippines.blogspot.com/ and subscribe to automatically receive my free articles.