ABF Singapore Bond Index Fund

Risk Classification: 2 – Conservative

Price per Unit (1 Apr 16): 1.18 [SGD]

Dividend Yield: 2.24%

Expense Ratio: 0.25%

Please refer prospectus for detailed risk disclosure

Investment Rationale:

This ETF broadly tracks the intermediate-term & long term Singapore government and government related credit market. We don’t expect a sharp sell-off in Singapore Govies due to our overall bearish outlook and easing bias of central banks across Asia, in line with Chinese PBOC. Although traditionally, MAS has followed US Fed policy, but macro headwinds in the region are more likely to dominate policy. Singapore has also always used currency to manage monetary and economic policy, while keeping interest rates and costs of capital in the economy low to promote investment. We therefore have a balanced and stable outlook for Singapore government bond market.

We show below chart to present the price relationship of this ETF with the inverse of 10-year Singapore swap market.

10y sing govies vs  sbif

Fundamental Risk to investment:

This ETF will sharply sell off in the event of a sharp sell-off in Singapore Government Bonds. This is not the base case expectation.

Details of ETF:

Details on NikkoAM website – For Live data and Prospectus