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Top Fund

January 2024

Top Fund Ideas For 1Q2024

PIMCO GIS Income Fund

Seeking high current income

MSCI ESG Rating: Nil

Suitable for:

Growth | Aggressive

The Income Fund is a portfolio that is actively managed and utilizes a broad range of fixed income securities that seek to produce an attractive level of income while maintaining a relatively low risk profile, with a secondary goal of capital appreciation.

The significant sell-off in bond yields and widening of spreads provide access to attractive yields that we haven’t seen in many years, driving higher return potential for today’s investors.

With central banks likely coming to the end of the rate hiking cycle, investors should lock in attractive yields for the longer term.

Past performance1

1Y 3.15%
3Y -0.83%
5Y 1.76%

Why we like the fund

Potentially attractive yield - The Fund has a yield-to-maturity of 7.34%2 and this provides additional buffer against any further increases in rates or spreads.

Diversified approach - The Fund is highly diversified with 6,000+ holdings, investing across the entire fixed income market. As we approach the later stage of the economic cycle, being up in quality and diversified is crucial to protect against a market selloff.

Capital preservation - Consistent income can help build returns over time, with capital gain potential when markets recover. The Fund is built for resilience under many scenarios for rates & spreads.

About the fund

Past 12M Dividend Yield 6.44%3
Fund inception date 30 November 2012
Fund size USD $67,110mil
Unified Fee 1.45% p.a.
Subscription modes Cash Only

Top 5 holdings (as of 30 September 2023)

%
FNMA TBA 5.0% NOV 30YR 4.49
FNMA TBA 3.5% NOV 30YR 4.08
FNMA PASS THRU 30YR #FS5749 3.94
FNMA TBA 6.0% OCT 30YR 3.88
FNMA TBA 5.5% NOV 30YR 3.74

NAV movement1

Source: NAV chart based on PIMCO data as at 14 December 2023; fund information extracted from PIMCO as at 30 November 2023.

Sector allocation

1Note: Fund performance figures are extracted from PIMCO for the GIS Income Fund E SGD- Hedged Income share class as of 30 November 2023, calculated on an offer-to-bid basis with all dividends and distributions reinvested, net of all charges payable upon reinvestment, if any. Performance figures exceeding 1 year, if any, were stated on an average annual compounded basis. Past performance figures do not reflect future performance.
2PIMCO calculates a Fund's Estimated Yield to Maturity by averaging the yield to maturity of each security held in the Fund on a market weighted basis. PIMCO sources each security's yield to maturity from PIMCO's Portfolio Analytics database. When not available in PIMCO's Portfolio Analytics database, PIMCO sources the security's yield to maturity from Bloomberg. When not available in either database, PIMCO will assign a yield to maturity for that security from a PIMCO matrix based on prior data. The source data used in such circumstances is a static metric and PIMCO makes no representation as to the accuracy of the data for the purposes of calculating the Estimated Yield to Maturity. The Estimated Yield to Maturity is provided for illustrative purposes only and should not be relied upon as a primary basis for an investment decision and should not be interpreted as a guarantee or prediction of future performance of the Fund or the likely returns of any investment.
3Latest figures from PIMCO for the GIS Income Fund E SGD- Hedged Income share class as of 30 November 2023. Past performance figures do not reflect future performance.

Amundi Funds Asia Income ESG Bond

Reinforce your income sustainably for the future

MSCI ESG Rating: A

Suitable for:

Balanced | Growth | Aggressive

The outlook on Asian fixed Income is positive thanks to positive growth-inflation dynamics and a more supportive external backdrop.

An anticipated decrease in US Treasury yields towards mid-2024 and stable credit spreads should support Asian Corporate bonds.

The market for green, social, sustainability, and sustainability-linked (GSSS) bonds is growing rapidly. Asia is responsible for an increasingly large share of overall issuance in this segment. There is increasing evidence that ESG factors have an impact on risk and returns. Investing responsibly is key to mitigating ESG risks.

Past performance

1Y N.A.
Since Inception N.A.

Why we like the fund

Potential for high income - The Fed’s pause in rate hikes should provide more breathing space for Asian markets, with a low rate of defaults expected in the region. Within Asia, we see opportunities within the specialised financial and consumer cyclical issuers.

Flexibility in Asia – The fund can invest in both investment-grade and high-yield bonds to capture opportunities in Asia and adjusts its allocation actively to adapt to the changing market environment.

Diversified ESG exposure – The fund’s GSSS bond exposure is spread across a variety of sectors including but not limited to utilities, financials, consumer, telecommunication and government-related sectors. This allows the fund to reduce extra financial risk and seek opportunities.

About the fund

Past 12M Dividend Yield N.A
Fund inception date 6 December 2023
Fund size2 USD 27.9 Mil
Annual management fee 1.15% p.a.
Subscription modes Cash Only

Top 5 holdings

%
Indonesia 5.55
Asian Development Bank 4.40
International Finance Corp 3.44
Freeport Indonesia PT 2.51
EBRD – European Bk Reconst Dvp 2.31

NAV movement1

Source: NAV chart based on Bloomberg data as at 31 December 2023; fund information extracted from the fund’s factsheet provided by Amundi as at 31 December 2023.

Asset allocation

Allianz Income and Growth

Position for income and potential growth

MSCI ESG Rating: AA

Suitable for:

Growth | Aggressive

2023 economic growth has exceeded expectations with Q3 real gross domestic product (GDP) expanding at the fastest pace since 2021. 2023’s momentum should carry over into 2024, but conflicting factors make it difficult to predict a path with certainty.

Changes in any of the macro conditions will likely influence investor sentiment, causing equity market volatility over the course of the year. High-yield credit and convertible securities should be better positioned to weather market volatility given current market dynamics, which in some respects are more favourable today than they were exiting 2022.

Consequently, today’s market outlook resembles 2023’s with mid to high single-digit returns possible by year-end 2024 for high-yield credit, convertible securities, and equities.

Past performance1

1Y 8.86%
3Y 0.74%
5Y 6.15%

Why we like the fund

A diversified 3-sleeve approach – The fund adopts a “three-sleeves” approach, with the core holdings invested primarily in a portfolio consisting of 1/3 US high-yield bonds, 1/3 US convertible bonds and 1/3 US equities/equity securities.

Position for income and potential growth – The three-sleeves approach has historically provided investors with good upside participation potential and lower downside risk compared to pure equity.

Targeted monthly dividend – The fund aims to provide a stable income stream regardless of NAV fluctuations.

About the fund

Past 12M Dividend Yield 7.72%2
Fund inception date 18 November 2011
Fund size USD $43,871.20 mil
Annual management fee 1.25% p.a.
Subscription modes Cash and SRS Only

Top 5 holdings

%
Microsoft Corp 2.10
Alphabet Inc – CL A 1.60
Amazon.com Inc 1.60
Apple Inc 1.50
Tesla Inc 1.30

NAV movement1

Source: NAV chart based on Bloomberg data as at 30 November 2023; fund information extracted from the fund’s factsheet provided by Allianz Global Investors as at 30 November 2023.

Sector allocation

1Note: Fund performance figures are extracted from Allianz Global Investors for the AM H2-SGD share class as of 30 November 2023, calculated on an offer-to-bid basis with all dividends and distributions reinvested, net of all charges payable upon reinvestment, if any. Performance figures exceeding 1 year, if any, were stated on an average annual compounded basis. Past performance figures do not reflect future performance.

2Latest figures from Allianz Global Investors for the AM H2-SGD share class as of 30 November 2023. Past performance figures do not reflect future performance.

AB Low Volatility Equity Portfolio

Seeks to deliver high quality and stability at an attractive price

Morningstar Rating: AA

Suitable for:

Growth | Aggressive

Equity portfolios designed to smooth volatility are especially appealing in the current market environment and companies that offer a combination of quality and stability at attractive prices are investments that ride through near-term uncertainty.

In the long-term, companies with these features are best positioned to deliver strong returns through changing environments and emerge as winners later.

Past performance1

1Y 10.88%
3Y 7.52%
5Y 7.96%

Why we like the fund

Healthy returns with low volatility – The investment team selects a portfolio of global equities that appear to be of high quality, have low volatility and reasonable valuations, and offer attractive shareholder returns.

Experienced and well-resourced Investment team – The team has decades of combined experience. As bottom-up stock prickers we focus on fundamental research and analysis, drawing on firmwide expertise of AB’s investment specialists to identify the best businesses across the world.

Potential to grow your capital – The Portfolio aims to increase the value of your investment over time through capital growth.

About the fund

Past 12M Dividend Yield (Class AD USD) 4.70%2
Fund inception date 11 December 2012
Fund size USD $5,553.57 mil2
Annual management fee 1.50% p.a.
Subscription modes Cash Only

Top 5 holdings

%
Microsoft Corp. 5.75
Alphabet, Inc. 3.31
Broadcom, Inc. 2.93
Apple, Inc. 2.91
Novo Nordisk A/S 2.38

NAV movement

Source: NAV chart based on Bloomberg data as at 30 November 2023; fund information extracted from the fund’s factsheet provided by AB as at 30 November 2023.

Sector allocation

1Note: Fund performance figures are extracted from AB for the Class A USD share class as of 30 November 2023, calculated on an offer-to-bid basis with all dividends and distributions reinvested, net of all charges payable upon reinvestment, if any. Performance figures exceeding 1 year, if any, were stated on an average annual compounded basis. Past performance figures do not reflect future performance.
2Latest figures from AB for the Class A USD share class as of 30 November 2023. Past performance figures do not reflect future performance.

LionGlobal Japan Growth Fund SGD-H

The Japanese Comeback

MSCI ESG Rating: AA

Suitable for:

Growth | Aggressive

The strong push by the Tokyo Stock Exchange to corporates to improve corporate governance and shareholder returns and the gradual rise in inflation, wages and possibly interest rates has provided investors with good reason to relook the Japanese stock market.

Globally competitive companies that can ride on structural growth trends and companies that can grow through value-added products and services are well-positioned for the recovery. Structural growth themes like factory automation and digitalization that enhance productivity across all types of economies, as well as solutions and products that contribute to sustainability and environmental protection are also promising growth drivers.

Past performance1

1Y 22.68%
3Y 15.57%
5Y 9.81%

Why we like the fund

De-risking from China - Reshoring efforts by the G7 economies to friendlier economies within the Asia Pacific is favourable for Japan.

Corporate governance restructuring – The Tokyo Stock Exchange has requested companies trading below price-to-book of 1x to improve valuations by restructuring businesses is a significant policy that can improve share prices.

Deflation to inflation – Japan’s economy is facing a sustained period of inflation that is forcing companies to hike wages, thus spurring consumers to spend more in an inflationary environment.

About the fund

Past 12M Dividend Yield -
Fund inception date 03 December 1999
Fund size S$ 188 million
Annual management fee 1.4% p.a.
Subscription modes Cash/SRS/CPF–OA

Top 5 holdings

%
MIZUHO FINANCIAL GROUP INC ORD NPV 2.9
SONY GROUP CORP ORD NPV 2.7
DENSO CORP ORD NPV 2.3
KEYENCE CORP ORD JPY50 1.9
HITACHI LTD ORD NPV 1.8

NAV movement1

Source: NAV chart based on Bloomberg data as at 30 November 2023; fund information extracted from the fund’s factsheet provided Lion Global Investors as at 30 November 2023.

Sector allocation

1Note: Fund performance figures are extracted from LionGlobal Investors for the SGD Dist (M) Hedged share class as of 30 November 2023, calculated on an offer-to-bid basis with all dividends and distributions reinvested, net of all charges payable upon reinvestment, if any. Performance figures exceeding 1 year, if any, were stated on an average annual compounded basis. Past performance figures do not reflect future performance.

FSSA Dividend Advantage Fund

Capturing the Asian growth story

MSCI ESG Rating: A

Suitable for:

Balanced | Growth | Aggressive

The recent dips in the 10Y UST yield and oil prices, coupled with more aggressive policy easing measures by the Chinese government could provide some near-term support to share prices. However, rising risks of a recession in the US, uncertainties arising from elections in the region (Taiwan, Indonesia and India) and structural challenges in China are potential offsetting factors.

A sustainable re-rating in Chinese equities would hinge on further coordinated policy support, a recovery in the real estate market and corporate earnings outlook. With light positioning and undemanding valuations, risk-return could become more favourable if these concerns subside.

Past performance1

1Y 16.70%
3Y annualised 11.6%
5Y annualised 16.4%

Why we like the fund

Diversified exposure in the Asian region – The fund offers broad exposure towards China, India and ASEAN equities, allowing investors to benefit from the growth trends in the region.

Preference for quality companies – The fund adopts a bottom-up selection methodology to identify high quality companies with sustainable and predictable growth to invest for the long term.

Yield enhancement – In a low real interest rate environment, this fund appeals to investors who are looking for yield; it pays a quarterly dividend of approximately 4% p.a.

About the fund

Past 12M Dividend Yield 4.01%2
Fund inception date 20 December 2004
Fund size S$4,650.0mn
Annual management fee 1.50% p.a.
Subscription modes Cash/SRS/CPF–OA

Top 5 holdings

%
HDFC Bank 9.2
Taiwan Semiconductor (TSMC) 6.7
Tencent Holdings Ltd. 5.1
Midea Group 4.5
CSL 4.0

NAV movement

Source: NAV chart based on Lipper data as at 30 November 2023; fund information extracted from the fund’s factsheet provided by First Sentier Investors as at 30 November 2023.

Sector allocation

1Note: Fund performance figures are extracted from Lipper for the SGD-Q Dist share class as of 30 November 2023, calculated on an offer-to-bid basis with all dividends and distributions reinvested, net of all charges payable upon reinvestment, if any. Performance figures exceeding 1 year, if any, were stated on an average annual compounded basis. Past performance figures do not reflect future performance.
2Latest figures from First Sentier Investors for the SGD-Q Dist share class as of 30 November 2023. Past performance figures do not reflect future performance.