ABF Singapore Bond Index Fund
-
A CHANCE TO TRADE IN GOVERNMENT BONDS NEW FUND LETS THEM DO SO WITH A MINIMUM INVESTMENT OF $1,000 AND TRANSACT ON THE SGX
Closing date at noon today (26 Aug)
Source: Today Online
posted on: 25 Aug 2005
THE ABF Singapore Bond Index Fund, Singapore's first exchange traded bond
fund saw a lively turnout at a seminar held on Tuesday in conjunction with
the fund's Initial Public Offer (IPO).
Managed by DBS Asset Management, the Fund will initially invest in a
portfolio of high quality, Singapore Government and quasi-Government
bonds+. The portfolio will closely mirror the basket of bonds in the iBoxx
ABF Singapore Bond Index. The index currently has about 35 bond issues.
Mr Ronald Howe, in his opening address, spoke of the increasing demand for
Asian bonds from both Asian and developed market investors. The Singapore
bond market is also well positioned to benefit from such inflow of funds.
DBS Asset Management explained to the seminar attendees that investors
with a minimum investment of $1,000 will buy into a portfolio of high
credit quality Singapore Government bonds and quasi-Government bonds.
Typically investors would require a larger outlay of capital to get the
same diversification.
The Fund, once it is listed on the Singapore Exchange from Aug 31, 2005,
will also offer convenience and accessibility to investors. Investors can
buy and sell Fund units traded on the SGX through their regular
stockbrokers just as they would for any other listed stocks.
Investors will also benefit from the low cost of the Fund. Unlike normal
unit trusts, there is no sales charge. Management fee is set at 0.15 per
cent per annum of the net asset value. However normal brokerage fees are
applicable for trades done via the stock exchange.
Mr Howe commented that the Fund is designed for investors who prefer lower
risk and lower cost. Investors seeking a better return than bank deposits
or to lower the risk of their investment from equities may wish to
consider this Fund.
The IPO, which started on Aug 15, will end at noon on Aug 26. Applications
for the IPO can be done at any DBS/POSB ATMs. The prospectus is available
at any DBS branch.
+The fund may in future invest in bonds denominated in Singapore dollars
issued by other Asian governments, agencies of other Asian governments, or
other quasi-Asian government entities if the composition of the iBoxx
ABF Singapore Bond Index includes such bonds. In that event, the credit
risk of the investments of the Fund may differ from its credit risk now.
The prospectus is available at all DBS and POSB branches when the offer
or invitation is made. Investors should read the prospectus before
deciding to subscribe for or purchase units in the Fund.
The value of the Fund and the income from them, if any, may fall or rise.
The annual distributions are dependent on the Fund's performance and not
guaranteed. Investors may only redeem units with the Manager under certain
specified conditions and the listing of the Fund on the Stock Exchange of
Singapore does not guarantee a liquid market for the units.
was at the retail seminar at DBS auditorium the day before, where DBS was promoting the fund's IPO. The fund started with 330mil and grew to 335mil.
The fund manager was answering a lot of tough questions regarding how much dividend yield and capital gain he would project. The past gains were mainly due to the flattening of the yield curve.
Those who are interested to reduce the volatility of their stock portfolio, may want to have a look at this stock (which invest in bonds).
-
How much per share? Any more info? I have no idea why they want to promote this fund so aggresively....
-
Interest rates go up, price of bonds go down.
-
close liao. think it's $1 per share.Originally posted by shade343:How much per share? Any more info? I have no idea why they want to promote this fund so aggresively....
maybe cos the response is going to be poor!
Who would think abt buying bonds when the economy seems to be recovering.
at first i tot so too.. but after listening to the talk, they were saying about a thing called flattening yield curve.Originally posted by charlize:Interest rates go up, price of bonds go down.
-> When interest rates goes up, prices of short term bonds goes down. However, cos of the higher price of borrowing plus uncertain growth prospect, prices of long term bonds go up. (something like dat)..
meaning, even tho i/r is increasing, people who were buying long term bonds were making some money.. but the returns would not be as spectacular as stocks tho.