About the Recommended Funds
With the huge array of funds available on the platform, the FSM Recommended Funds Report serves as a starting point for investors. The careful study of fund factsheets, prospectus and semi-annual/annual reports are essential reading for investors who are determined to take a more active role in selecting funds for their portfolio. Choosing the right fund to invest in is only one part of the investment process; a suitable asset allocation and the desired exposure to individual markets are critical considerations for a successful investment.
WHY WE RECOMMEND THESE FUNDS
Fund payment mode: C - Cash,
O - CPFIS-OA,
S - CPFIS-SA.
Core portfolio
Equity Funds
Core Equity - Asia Ex Japan
Strong track record Tended to outperform under bullish equity market conditions Suitable for investors seeking more aggressive returns from Asia ex-Japan equities
Strong track record, aided by fund’s defensive nature Resilient nature has seen the fund outperform during difficult periods in the equity market, but fund has underperformed in more bullish periods Suitable for investors seeking a more defensive approach when investing in the Asia ex-Japan market
Consistent performer, scored highly in both performance and risk management Low expense ratio due to modest annual management fees Fund may appeal to cost-conscious investors, without sacrificing management quality
Core Equity - Asia Pacific Ex Japan
Strong, consistent performance, coupled with good risk management Differentiated investment returns provides evidence of strong active management Rides on the strength of underlying single-country Asian equity funds; no double charging of fees despite the “fund-of-funds” structure
Focuses on companies with high dividend yields; often viewed as a more defensive segment of the equity market Resilient performer, scored highly in terms of risk management Decent track record, fund’s dividend-focus may appeal to more defensive-minded investors
Core Equity - Europe
Only European equity fund with positive returns over five years (as of end-March 2012) Significantly outperformed benchmark and peers, suggesting strong active management Consistency and strength of returns would appeal to investors
Core Equity - Global
Strong, consistent track record Has achieved decent performance without excessive risk Suitable for investors seeking exposure to a diversified portfolio of markets and sectors
“Manager of Managers” approach; all securities held by the fund under a single custodian Highly-diversified approach to investing in global equities Exposure to a mix of growth, quality, value and momentum approaches
Core Equity - Global Emerging Markets
Strong performance, aided by fund’s defensive nature Fund has tended to outperform in down markets, but has underperformed under more bullish market conditions Strong active returns reflect manager’s active bottom-up approach
Core Equity - Japan
Focuses on mid to small market capitalisation Japanese companies Outperformance over the long-term, without taking on excessive risk Suitable for investors seeking to exploit inefficiencies in the Japanese equity market via an actively-managed strategy
Concentrated, high-conviction approach Has not demonstrated higher-than-average risk levels, despite focused strategy Tends to outperform in rising markets, but not as defensive as some of its peers
Core Equity - US
Consistent performer with a decent long-term track record Managed closely against the fund’s benchmark, the S&P 500 Suitable for investors who want more diversified exposure to US equities, with the added benefit of active management
Dividend-focused strategy Resilient performance, possesses defensive attributes Suitable for investors who prefer a more defensive US equity strategy, or expect a dividend-focused strategy to outperform the broader market
Bonds Funds
Bonds - Asia
Asian debt exposure, no bias towards sovereign or corporate debt Unrestricted mandate means fund may have some exposure to high yield Managed from an SGD-perspective, managers seek to maximise returns in SGD terms Recommended for exposure to the Asian bond market
Bonds - Global
Actively-managed bond allocation Exposure across Government bonds (low risk) to High Yield (higher risk) securities USD focused, but SGD-hedged Recommended for investors who want exposure to many bond classes in one fund
Global bond fund, but Singapore-centric Invests in higher quality corporate bonds Managed from an SGD-perspective, exposure is mostly to the SGD Recommended for investors seeking a lower-risk global bond fund with a tilt towards Singapore bonds
Bonds - Global Emerging Markets
Emerging Market bonds, fairly flexible investment mandate Government bonds, hard currency focus Targets monthly distributions from income of at least 5% per annum Managed from a SGD perspective
Bonds - High Yield (Asia)
Asian High Yield Bonds; primarily invested in corporate bonds Recommended for investors looking for a high-risk high-return segment of the fixed income market Managed from a USD-perspective, but SGD-hedged
Bonds - High Yield (Global)
Invests primarily in High Yield Corporate Bonds Generally positioned more conservatively in a higher-risk segment of the bond market GD-hedged Recommended for investors who want higher yields in return for higher risk, but prefer to have exposure to the higher-rated securities within the global high yield space
Bonds - High Yield (US)
US High Yield bond focused, diversified across a large number of issuers Disciplined focus on credit selection, prefers independent ratings on securities SGD-hedged to protect returns in SGD terms Recommended for diversified exposure to the high-risk, high-return US high yield bond market
Bonds - Money Market & Short Duration
Lowest risk amongst fixed income funds, due to exposure to fixed deposits Managed from an SGD-perspective No lock-in periods or penalties for redemption as compared to time deposits Historical pricing and “same day” transactional feature makes the fund a useful parking tool Recommended for investors looking for a low-risk alternative to savings deposits
Invests in short duration instruments like short-term bonds and money market instruments Managed from an SGD-perspective; foreign currency holdings are hedged back to the SGD “Same day” transactional feature makes the fund a useful parking tool Recommended for investors who are looking for yield but want to avoid taking on excessive interest rate risk
Bonds - Singapore-Centric
Invests primarily in Singapore bonds, with a mix of government and corporate bonds Primarily investment grade or higher quality bonds Managed from an SGD-perspective Recommended for investors looking for an alternative to investing directly in SGS (Singapore Government Securities)
Seeks to beat SGD deposit rates Attractive yields for a Short Duration/Money Market fund Fund will hold longer-maturity securities which the manager expects to be called within 3 years Managed from a SGD perspective Recommended for investors who are looking for yield but want to avoid taking on excessive interest rate risk
Supplementary portfolio
Regional Equity
Sub Regional Equity - BRIC
Strong track record with good risk management Managers tend to track the benchmark fairly closely Suitable for investors seeking a BRIC-focused strategy which has delivered consistent returns
Sub Regional Equity - EEMEA
Strong active returns, indicative of good stock-picking ability Manager has demonstrated willingness to take off-benchmark positions May be used in conjunction with other regional/sub-regional equity funds for more diversified exposure to global emerging market equities
Sub Regional Equity - Emerging Europe
Strongest performer amongst peers, with the lowest risk Manager supplements bottom-up stock picking with top-down country allocation views Suitable for investors seeking more targeted exposure to the Emerging Europe sub-region, or prefer a more diversified approach to investing in Russian equities
Sub Regional Equity - Greater China
Ranked first on both risk management and performance measures; defensive nature has aided returns Proprietary bottom-up approach to exploit market inefficiencies has reaped rewards Fund will appeal to investors seeking strong, consistent performance when investing in the Greater China region
Sub Regional Equity - Latin America
Strong track record with good risk management Managers tend to track the benchmark fairly closely Suitable for investors seeking a strategy which has delivered returns similar to that of the broader market, with active positioning to generate alpha
Country Equity
Country Equity - Australia
Outperformed benchmark over 5 years High-conviction approach, relatively concentrated portfolio Used in conjunction with an Asia ex-Japan equity fund, investors can adjust the weight of their exposure to Australian equities
Country Equity - China
Outperformed benchmark over 5 years; strong track record along with good risk management Growth oriented approach, manager prefers industry leaders with high entry barriers and low costs of production Highly diversified nature may appeal to investors
Country Equity - India
Concentrated, high-conviction approach, without sacrificing risk management Has demonstrated defensive qualities in times of market turmoil Suitable for those who seek a more resilient fund when investing in the Indian equity market
Country Equity - Indonesia
Concentrated, high-conviction approach, without sacrificing risk management Strong active positioning evidence of benchmark agnostic approach Suitable for those who seek a strong active returns when investing in the Indonesia equity market
Country Equity - Malaysia
Significantly outperformed both peers and benchmark Strong active positioning evidence of benchmark agnostic approach, has demonstrated resilience Will appeal to proponents of active fund management
Country Equity - Russia
Delivered better returns vis-à-vis its peers over the longer term Expected to have large exposures to the more volatile energy and materials sectors Russian equities have tended to be fairly volatile; less aggressive investors could look towards a more diversified Emerging Europe equity fund
Country Equity - Singapore
Strong consistent performer, outperformed both peers and benchmark over the longer term Resilient, despite fairly concentrated portfolio Active management approach has delivered strong alpha, fund will appeal to investors seeking to outperform a passive benchmark
Country Equity - South Korea
Longer-term outperformance of peers and benchmark High conviction, “value contrarian” investment approach Patience required due to fund’s long-term “mean-reversion” approach
Country Equity - Taiwan
Style bias towards “quality” and “growth” Managed fairly closely against the fund’s benchmark, the MSCI Taiwan 10/40 Net Total Return Index Suitable for more targeted exposure to Taiwan equities, as opposed to a more diversified Greater China fund
Country Equity - Thailand
Value-oriented, bias towards medium-to-large capitalisation companies Manager is benchmark aware, fund managed fairly closely against the benchmark Strong track record against peers
Sector Equity
Sector Equity - Asia Small Cap
Small capitalisation focused, resilient performer Tended to outperform under weak market conditions Fairly diversified, defensive nature may appeal to investors
Sector Equity - Global Financials
Outperformed peers, despite weak general performance for the sector Not a low-risk fund, given the concentrated investment mandate and prevailing volatility in global financial stocks Provides exposure to some of the largest global financial companies; limit exposure to supplementary portion of the portfolio
Sector Equity - Global Property
Narrow focus, invests in global property companies and REITs Outperformance of peers, despite weak overall returns for the sector Largely exposed to US property companies, but also provides exposure to property companies in Asia and Europe
Sector Equity - Global Resources
Strong long-term performance Higher volatility expected due to more concentrated investment mandate Performance may have a strong positive correlation with commodity prices
Sector Equity - Global Technology
Ranked first in category for longer-term returns Posted lowest risk measures among peers Provides exposure to the global technology space, with a slant towards Tech companies in developed markets
CPFIS-SA
Balanced Funds
CPFIS-SA Approved - Asia Balanced
Strong, consistent performer Resilient in weak markets, aided by allocation to fixed income Suitable for investors seeking exposure to both Asian equities and fixed income in a single fund
CPFIS-SA Approved - Global Balanced
Best-performing in its category on various performance metrics; also outperformed benchmark since fund restructured in 2006 Multi-asset approach May appeal to investors seeking a highly-diversified fund, with exposure to various asset classes
CPFIS Registered Investment Administrator
