What are the risks of investing in a UITF?
Because the assets of the UITF are valued based on the prevailing market price, there is a possibility of incurring losses in the UITF if the client withdraws in a scenario of generally declining market prices. Clients may, however, opt to defer their withdrawals until market conditions become more favorable. Being a trust product, there is no guarantee on the principal and income of the investments and losses, if any, shall be for the risk of the UITF investors. UITFs are governed by BSP regulations but are not deposit products, hence are not covered by the Philippine Deposit Insurance Corporation (PDIC).
