Take a medium-term view
Take a medium-term view
After the sharp run-up in markets this year, there are concerns that pullback may be on the cards. We have said many times before that corrections are normal in a bull market and investors should not expect markets to go up unabated and in a straight-line fashion. What’s more important is that the medium-term outlook remains positive and for those with the risk appetite and the ability to withstand volatility and stay invested, patience can still be rewarding.
Structured Investments
China’s “anti-involution” campaign is gaining traction among investors as policymakers intensify efforts to address overcapacity and excessive competition that have been fuelling deflationary pressures across industries. This initiative aims to promote more sustainable growth and improve industrial profitability, creating tailwinds for companies with strong fundamentals and strategic positioning. Potential beneficiaries include:
- Jiangxi Copper Co Ltd - one of the largest copper producers in China, with most of its core assets located in China, limiting exposure to geopolitical risks. Copper demand is expected to benefit from increased investments in power grid and renewable energy projects. In 1H2025, net profit rose 15% year-on-year, beating market expectations. Smelting margins remained resilient, supported by stronger sulfuric acid earnings and a higher proportion of long -term contracts locked in at US$21/tonne for 2025. Additionally, improved profitability from the mined copper and gold segments continue to underpin solid earnings momentum into 2H2025.
- Zijin Mining Group - a leading global mining conglomerate, ranked among the top 10 producers of both gold and copper. It has growing exposure to lithium, aligning with the rising global demand for battery materials. Known for its cost-efficient operations, Zijin maintains a competitive advantage both in China and globally. Its 1H2025 results were in line with pre-announced guidance, with growth driven by higher sales volume and stronger pricing for gold and copper. With cost leadership, a diversified resource base, and exposure to strategic minerals, Zijin is well-positioned to benefit from China’s push for industrial consolidation and resource security.
Bonds
Macquarie Group Ltd, listed on the Australian Stock Exchange, is one of Australia’s largest and diversified financial institutions outside the big four Australian banks. As of 31 March 2025, Macquarie reported total assets of A$445.2 billion and operates in 31 markets globally with an unbroken record of profitability since establishment.
Macquarie Group Ltd (AUD)
This bond pays a coupon of 4.15% with maturity date on 15 December 2027.
Macquarie’s business spans asset management, retail and business banking, wealth management, leasing and asset financing, commodity trading, renewables development, specialist advice, access to capital and principal investment.
The group’s business profile is diversified by segments and geography (international income contributed 66% of total income in FY2025 split across Americas (32%), EMEA (24%) and Asia (10%)) with overall fundamentals insulated from market volatility through balanced and offsetting performance from its annuity businesses including Macquarie Asset Management, Banking and Financial Services and certain businesses in Commodities and Global Markets (CGM) against its more cyclical markets facing businesses including Macquarie Capital and most businesses in CGM. Annuity style businesses generated about 54% of FY2025 net operating income while markets facing businesses generated the rest.
Macquarie continues to maintain a solid capital position with a CET1 ratio at 12.8% as of 31 March 2025 – translating to a capital surplus of A$9.5b billion against the 10.5% minimum under the Australian Prudential Regulation Authority (APRA)’s “Unquestionably Strong” bank capital framework.
The Leverage Ratio (5.1%), Liquidity Coverage Ratio (175%) and Net Stable Funding Ratio (113%) as of 31 March 2025 remain well above the minimum regulatory requirements of 3%, 100% and 100% respectively.
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 7.01% p.a.
Note: Past performance figures do not reflect future performance. Dividend figures are from Bloomberg, as of 30 September 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 30 September 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 6.07% p.a.
Note: Past performance figures do not reflect future performance. Dividend figures are from Bloomberg, as of 30 September 2025.
Equity Funds
Abrdn Global Dynamic Dividend Fund
The Abrdn Global Dynamic Dividend Fund is a global equity fund that aims to achieve income combined with long-term capital growth. It invests at least two-thirds of its assets in equities and equity-related securities of companies. To increase the overall level of income generated, a small portion of investments are held for short periods of time to capture regular dividends that are paid along with one-off or special dividends from companies.
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
The US Dollar (USD) Index traded a month of two halves for September – with weakness seen heading into the US central bank’s Federal Open Market Committee policy meeting (FOMC), and subsequently rebounding post-FOMC on cautious comments from Federal Reserve (Fed) officials. The Fed’s Austan Dean Goolsbee who is the president of the Federal Reserve Bank of Chicago, indicated that he could be less willing to support “overly frontloading a lot of rate cuts” on the presumption that inflation will just be transitory and go away, as many Midwest businesses are still concerned that inflation is not under control.
Fed Chairman Jerome Powell also said that market expectations for another two rate cuts this year were far from a done deal. Elsewhere, Lorie Logan, president and CEO of the Federal Reserve Bank of Dallas, indicated that the Fed should proceed cautiously on further rate cuts and there may be little room for more cuts. Looking into 2026, we continue to expect the USD to trade moderately softer as the Fed resumes easing while US exceptionalism fades.
We expect two more Fed rate cuts for 2025, following the 25 basis points (bp) rate cut at the September FOMC. The USD has room to fall as long as broader risk-on sentiment stays intact, growth conditions outside the US remains supported and the Fed stays on an easing path. In the near term, the Fed’s “risk management cut” at the September FOMC and cautious comments from Fed officials, may not be sufficiently dovish to see the USD decline in a big way. But if US data turns out to be softer-than-expected and the Fed cuts rates more decisively, then USD bears may return with more conviction.
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