Stock market: In or out?

According to Andro Leo Beltran, vice president and head of digital solutions and investor engagement division of First Metro Securities Brokerage Corp., the Philippine stock market, much like any market, moves in cycles — driven by earnings growth, macroeconomic direction, liquidity conditions and investor sentiment.

- MARIANNE GO

“As of late, we've been seeing a market that is cautiously optimistic, but still selective. Inflation has shown signs of moderating, interest rates appear to be nearing stabilization and corporate earnings — while mixed apross sectors — continue to show resilience in consumer-driven and infrastructure-related industries.

“Is it time to go back to the market? The honest and prudent answer is: it is always a good time to be strategically in the market, but never a good time to be recklessly in the market.”

He explains that “timing the market perfectly is nearly impossible — even for seasoned professionals.

Historically, markets reward discipline, consistency and time in the market rather than attempts to predict short-term movements. Volatility, while uncomfortable, is often where opportunities quietly present themselves.”

Beltran, a prudent approach should involve a gradual reentry or peso-cost averaging instead of deploying funds all at once. He advises investors to consider spreading investments over time to manage volatility and reduce the risk of entering at an unfavorable price level.

He likewise cites the need to focus on fundamentals, “as history just keeps on repeating itself, but it’s not always the same scenario. Companies with strong balance sheets, sustainable earnings growth, reliable dividend policies and clear expansion strategies tend to outperform over longer investment horizons.”

“Diversification is nonnegotiable,” he stressed, pointing out that “exposure across sectors and asset classes helps cushion portfolio volatility. Investors should avoid concentration risk, especially in uncertain macro environments.”

He adds that market players must align investments with goals and a time horizon, explaining that “short-term market swings matter less when investments are anchored on long-term financial objectives such as retirement, education or wealth preservation.”