The year 2020 is going to be the year of the male white metal rat. To avoid any losses in translation, so to speak, allow me to quote the basic fortune forecast for 2020 from http://www.chinesefortunecalendar.com/2020-ChineseHoroscope.htm.

“If your Lucky Element is Metal, then Metal of 2020 will bring you good luck. If your Lucky Element is Water, then Rat of 2020 will bring good fortune to you…2020 is the Metal Rat year. Rat mainly contains Water. Therefore, the year of 2020 brings in Water. 2020 will be a great year because it contains the lucky element of Metal. The Metal of 2020 is related to money. This person has a good opportunity for prosperity. The Water of Rat is related to the job. He will focus on career opportunities or job responsibilities.”

Regardless of what horoscopes say, the Philippine economy is expected to continue its 6% quarterly GDP growth in 2020. The local economy has also been adjudged the most resilient among emerging markets in the face of global uncertainties hounding the capital markets thus far in 2019, foremost of which is the trade war between the two largest economies of the world.

The national government is dead set on restarting several of the build, build, build projects that were delayed by the budget impasse of 2019 and completing many of such projects before President Duterte completes his term of office.  In the meantime, business confidence remains high, especially with a dovish central bank amidst a backdrop of decelerating inflation.

You may ask then, “Why does this blog’s title say fearful and not fearless forecast?”  The reason is that people may not see the opportunity that is about to unfold primarily because people in general, and not just Filipinos, are risk averse.

The rich, who have taken risks to get to where they are now, appreciate that risk is not the reward. If the rich read this blog, they will immediately formulate strategies and tactics to take advantage of the opportunities that lie before them.  This is probably part of the reason why the rich get richer and the poor poorer.

But those still creating and growing their wealth should not feel handicapped simply because they do not possess large sums of money.

Financial products have long been set up to facilitate the more equitable distribution of wealth.  Foremost of these products are pooled funds (e.g. mutual funds, unit investment trust funds and variable unit-linked insurance), which have affordable initial minimum investment amounts, professional management, marketability (i.e. ability to liquidate investments quickly at current market price) and managed risks through diversification.

Short-term fluctuations will occur and make the values of these financial securities volatile.  But pooled funds tend to perform better and generate less stress over the long-run than investing directly.

What’s more, pooled funds are regulated by the Bangko Sentral ng Pilipinas, Securities and Exchange Commission and Insurance Commission.  The investor can sleep soundly at night knowing that what he got into is legitimate.

The Philippines is indeed on its way to becoming a middle-class economy in the near term and an economic powerhouse in the long-term. And for the average Juan dela Cruz, the real risk is not in investing itself but in the prospect of being left behind by not investing.