UITF Investing: The Fund Inside Your Bank

By the Income.ph Editorial Team · Last updated: July 21, 2026

Quick answer: A UITF (Unit Investment Trust Fund) is a pooled investment managed by a bank's trust arm — you buy units at the day's NAVPU, and professionals invest the pool in deposits, bonds, or stocks depending on the fund. Minimums start around ₱1,000, many banks let you invest in-app, and PSEi index UITFs are among the simplest ways for Filipinos to own the stock market.

How UITFs work

Your bank's trust department pools investors' money and manages it per the fund's declared mandate. You buy units priced daily at NAVPU (net asset value per unit); you earn by redeeming at a higher NAVPU. Note: UITFs are trust products, not deposits — no PDIC insurance, values fluctuate.

The UITF menu at most banks

Money market UITFs — short-term instruments; minimal fluctuation; a step up from savings rates for parked cash
Bond UITFs — government and corporate bonds; moderate movement (bond basics: bonds guide)
Balanced UITFs — stock/bond blends
Equity and index UITFs — stock market exposure; PSEi index funds simply mirror the index at low cost (PSEi explained)
Feeder funds — channel your pesos into global funds (S&P 500 and world indexes) — the easiest route to international diversification

Fees and fine print

Trust fee: the annual management charge, typically ~0.5–1.5%, already reflected in NAVPU. Index funds should sit at the low end — compare across banks.
Holding period: many UITFs charge an early redemption fee if you exit within 30–90 days — fine for long-term investors, worth knowing anyway.
No sales load in most UITFs — an edge over loaded mutual funds.

Starting in four steps

Open a trust/investment account with your bank (often fully in-app now).
Take the risk profile questionnaire honestly — it gates which funds you can access.
Match the fund to the money's timeline: money market for months, bonds for years, equity index for 5–10+ years.
Automate monthly purchases and stop watching daily NAVPU.

Where UITFs fit

After the emergency fund and MP2, an index UITF is arguably the simplest next step — diversified equities with zero stock-picking, purchased from the banking app already on your phone. Just ₱1,000 to start? See the ₱1,000 starter plan.

Frequently asked questions

Is a UITF safe? Is it covered by PDIC?

UITFs are regulated bank trust products but are NOT deposits and NOT PDIC-insured — values rise and fall with the underlying investments. Risk depends on fund type: money market UITFs barely move; equity UITFs swing with the stock market.

How much do I need to invest in a UITF?

Most banks accept initial investments from around ₱1,000, with similar minimums for additions — and in-app purchases have made small regular investing practical.

What is NAVPU?

Net Asset Value Per Unit — the daily price of one unit of the fund, calculated from the total value of the fund's holdings. You buy and redeem at NAVPU; your return is the change between them.

Are UITF earnings taxed?

Tax treatment depends on the fund's underlying instruments and is generally handled within the fund — individual investors typically receive redemption proceeds without filing anything. Verify specifics with your bank for large amounts.

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.