Philippine Finance Glossary
Plain-English definitions of the money terms used across Income.ph, written for the Philippine context.
Board lot
The minimum number of shares you can buy or sell for a given stock on the PSE, set based on the stock's price range.
Blue chip
A large, established, financially sound listed company — in the Philippines, typically a member of the PSEi like SM, BDO, or Ayala.
Compound interest
Earning returns on both your original money and previously earned returns. The engine behind MP2's compounded dividend option.
Dividend
A share of profits paid to investors — by companies to stockholders, or by funds like Pag-IBIG MP2 to savers.
Emergency fund
Savings covering 3–6 months of essential expenses, kept instantly accessible for job loss, medical bills, and other emergencies.
Index fund
A fund that automatically holds all the stocks in an index (like the PSEi), giving instant diversification at low cost.
Inflation
The rate at which prices rise and money loses purchasing power — the silent reason cash under the mattress shrinks in value.
MP2 (Modified Pag-IBIG II)
A voluntary, government-guaranteed Pag-IBIG savings program with a 5-year term and tax-free annual dividends, minimum ₱500 per remittance.
PDIC insurance
Government deposit insurance covering bank deposits up to ₱1,000,000 per depositor per bank, including BSP-licensed digital banks.
Peso-cost averaging
Investing a fixed peso amount on a regular schedule regardless of price, which averages out your buying price over time.
PSEi
The Philippine Stock Exchange index, tracking the 30 largest listed companies — the standard benchmark for the Philippine stock market.
REIT
Real Estate Investment Trust — a listed company that owns income-generating property and must distribute at least 90% of income as dividends.
Time deposit
A bank deposit locked for a fixed term in exchange for higher interest than regular savings; early withdrawal forfeits some interest.
UITF
Unit Investment Trust Fund — a pooled investment managed by a bank's trust arm, bought in units; a common hands-off way to invest in stocks or bonds.
VUL
Variable Universal Life — insurance bundled with investment. Flexible but fee-heavy; many buyers do better with separate term insurance plus direct investing.
Withholding tax
Tax deducted at source — e.g., the 20% final tax on bank interest, or the 10% final tax on Philippine stock cash dividends.
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This article is for general information only and is not financial, investment, tax, or legal advice. Rates, fees, and program rules change — always verify with the official provider before making decisions. Full disclaimer.