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Stay invested

Stay invested

  • September 2025
  • By OCBC
  • 10 mins

We remain sanguine on the medium-term investment outlook. Liquidity remains abundant and should be supportive of markets. Investors should stay invested and continue to manage risk through diversification, dollar cost averaging and a focus on quality. There will no doubt be occasional market pullbacks and continued volatility. However, these have become fixtures in a complex and fast changing investment landscape - they are not reasons to stay away from markets. Ultimately investment is a journey and not a race. If you have a decent risk appetite and if you are prepared to take a medium-term view with your investments, the patience can pay off.

Structured Investments

The Artificial Intelligence super trend continues to be a powerful driver of innovation infrastructure. Companies that enable digital innovation and protect digital infrastructure are of strategic importance and are well positioned for long-term growth. Two market leaders embody this trend through their technological leadership and vital roles in the digital ecosystem:

  • Taiwan Semiconductor Manufacturing Co Ltd (TSMC) is the world’s largest and most advanced contract chip manufacturer, holding an over 60% market share in 2024. It plays a vital role in the global tech ecosystem by producing cutting-edge semiconductors for fabless companies, enabling innovations in AI, high-performance computing, and Internet of Things. TSMC’s leadership in advanced process nodes and its strategic focus on logic products have helped it maintain a competitive edge despite rising competition. TSMC offers exposure to long-term growth trends driven by increasing demand for energy-efficient, high-performance chips and the consolidation of semiconductor firms seeking integrated systems built on leading-edge technology.
  • Fortinet Inc is a global leader in cybersecurity, offering a comprehensive platform that integrates network security, cloud protection, and security operations. With a strong global customer base and a recurring revenue model driven by subscriptions and support, Fortinet is well-positioned to benefit from the growing demand for consolidated security solutions. As cyber threats become more sophisticated, enterprises are increasingly investing in unified platforms to reduce complexity and improve resilience. Fortinet’s expansion into high-growth areas such as security operations, positions it to capture a larger share of enterprise security spending.

Bonds

AIA Group is a leading Asia Pacific insurer with operations in 18 markets, including a joint venture in India. Its largest markets are Hong Kong, China and Thailand. Listed in Hong Kong, AIA has strong credit ratings and a robust solvency ratio, supported by a diversified product mix and distribution channels.

AIA Group Ltd (USD)

This bond pays a coupon of 3.60% with maturity date 9 April 2029.

AIA had a strong FY2024 performance, with operating profit after tax up 7% year-on-year, while net profit surged 81%, supported by improved investment results and the absence of unrealised losses seen in FY2023.

It also enjoyed robust new business growth, with value of new business increasing 18% year-on-year, with double-digit growth across all segments. Value of new business margin improved to 54.8%, and underlying contractual service margin rose 9% to US$56.2 billion.

AIA has maintained a high-quality investment portfolio, with increased equity exposure. Risks in China investments are manageable given US$40 billion in equity and US$56 billion in contractual service margin.

Despite a decline in the solvency ratio to 257% due to shareholder returns, AIA remains well above the regulatory minimums. Leverage ratio stayed manageable at 13.1% in FY2024.

Funds

Multi-asset Funds

Lion-Bank of Singapore CIO Supertrends Multi Asset Fund

The Lion-BOS CIO Supertrends Multi-Asset Fund is a multi-asset strategy that aims to provide income and long-term capital growth by investing in a diversified portfolio of asset classes including global equities, ETFs, global bonds, the writing of equity covered call options and other collective investment schemes. Guided by research from Bank of Singapore’s award-winning Chief Investment Office, the fund takes a rigorous research-based approach to identify quality companies within equities and fixed income with resilient business models and robust fundamentals. The fund also has distribution share classes for investors looking for dividend income.

PIMCO Balanced Income & Growth Fund

The PIMCO Balanced Income & Growth Fund is a global multi-sector strategy that seeks to combine PIMCO’s total return investment process and philosophy with income maximisation. The portfolio construction is founded on the principle of diversification across a broad range of equity and global fixed income securities. The fund has a historical annualised dividend yield of 7.11% p.a.

Note: Past performance figures do not reflect future performance. Dividend figures are from Bloomberg, as of 29 August 2025.

Bond Funds

PIMCO GIS Income Fund

The PIMCO GIS Income Fund is designed for investors who seek steady income with a secondary goal of capital appreciation. It takes a broad-based approach to investing in income-generating bonds. The fund aims to achieve this by employing PIMCO’s best income-generating ideas across global fixed income sectors. The fund has a historical annualised dividend yield of 6.53% p.a.

Note: Past performance figures do not reflect future performance. Dividend figures are from Bloomberg, as of 29 August 2025.

M&G (Lux) Optimal Income

The M&G (Lux) Optimal Income Fund is a global bond fund that aims to provide a combination of capital growth and income to deliver a return based on exposure to optimal income streams in investment markets, while applying environmental, social and governance (ESG) criteria. The fund has a historical annualised dividend yield of 6.03% p.a.

Note: Past performance figures do not reflect future performance. Dividend figures are from Bloomberg, as of 29 August 2025.

Equity Funds

AB Low Volatility Equity Portfolio Fund

The AB Low Volatility Equity Portfolio fund is a global equity fund seeking capital growth through securities of companies that the fund manager believes have lower volatility. Its investment approach focuses on quality, stability and price, where the fund seeks high quality stocks of companies with stable performance and predictable earnings, trading at attractive prices. The fund also has distribution share classes for investors looking for dividend income.

Currencies

We continue to expect the US Dollar (USD) to trade softer as the Fed potentially resumes easing while US exceptionalism fades. The USD has room to fall as long as the broader risk-on sentiment stays intact and growth conditions outside US remains supported. Nonetheless, we believe the USD’s decline is not linear and likely to be bumpy, driven by data surprises, market expectations of Fed rate cuts and tariff risks. USD re-allocation momentum can pick up when the USD’s decline accelerates. More broadly, US policy unpredictability, and concerns of about the rising trajectory of US debt and deficits in the medium term, should continue to underpin the broad (and likely bumpy) decline in the USD.