How to choose the right Unit Investment Trust Fund (UITF)

Understanding the different types of unit investment trust funds (UITFs) is the first step toward choosing an investment that fits your goals.

A unit investment trust fund (UITF) pools money from multiple investors and places it under professional management. Depending on the fund type, that money is invested across a range of instruments, from short-term government securities to equities. 

Each fund type has a distinct risk-return profile, and understanding the differences is important before making any investment decision.

Types of UITFs and what they are designed for

UITF investments are not one-size-fits-all — each fund type is structured around a specific level of risk and a corresponding investment horizon.

• Money market funds are the most conservative option. They invest primarily in short-term government securities and other low-risk instruments, making them suitable for investors who prioritize capital preservation and liquidity over growth. These tend to suit short-term goals.
• Bond funds invest in a mix of government and corporate bonds with fixed interest payments. They carry more risk than money market funds but offer higher potential returns over a medium-term horizon of two to five years. Investors with a moderate risk tolerance and a defined timeline tend to gravitate toward this category.
• Balanced funds hold a combination of bonds and equities, giving investors exposure to growth potential while maintaining some fixed income cushion. They may suit investors who want higher returns than bond funds can offer but are not yet comfortable with full equity exposure.
• Equity funds invest entirely or predominantly in stocks. They carry the highest level of risk among all investment trust fund types but offer the greatest potential for long-term capital growth. Equity funds may suit investors with a higher risk tolerance and a time horizon of five years or more, as short-term market fluctuations are part of the investment experience.

Matching fund type to risk profile

The Suitability Assessment Questionnaire, completed during account opening, evaluates your financial situation, investment goals, and risk tolerance, and recommends the fund categories most appropriate for your profile. 

Conservative investors are typically directed toward money market or bond funds. Moderate investors may find balanced funds the most appropriate fit. Aggressive investors with long time horizons are generally suited to equity funds.

Exploring the UITF options in the Philippines by category can give you a clearer view of available options, performance histories, and minimum investment requirements before you commit.

For investors ready to take the next step, opening a UITF investment account online through Metrobank starts at PHP 10,000 and can be completed in a few steps through Metrobank Online. If you need help identifying the right trust fund in the Philippines for your specific situation, a Metrobank wealth advisor can guide you through the decision based on your goals and timeline.

Disclaimer: Unit Investment Trust Funds (UITFs) are not deposit products and are not insured by the Philippine Deposit Insurance Corporation (PDIC). They are not obligations of, nor guaranteed by, the Metrobank or its affiliates or subsidiaries. Due to the nature of the investments, returns and principal value may fluctuate, and losses may be incurred.