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Business Times
6 days ago
- Business
- Business Times
Japan's trade win, bond yields and Singapore's big bet on the STI
Japan's new trade pact with the US has sent the Nikkei soaring. But is the euphoria justified? In this episode of Market Focus Weekly, a podcast from The Business Times hosted by Emily Liu, Endowus CIO Hugh Chung joins the show to unpack the headlines moving Asian markets this week from bond market jitters and central bank silence to a billion-dollar boost for Singapore's Straits Times Index (STI). And if you're wondering whether the de-dollarisation narrative holds water, or where retail investors are looking beyond the US, we've got you covered. Why listen? Because Japan just bagged a trade win but is the rally overcooked? Markets love momentum, but some parts of the Nikkei are already looking pricey. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Because bond yields are climbing quietly but steadily Japan's 30-year yield just breached 3 per cent. That's not nothing. Because Singapore's MAS is putting real money on the table A S$1.1 billion injection to lift market participation? It's a move worth watching. Because everyone's talking about de-dollarisation but should you care? The noise is loud, but the fundamentals may tell a different story. Market Focus Weekly is a markets podcast from The Business Times, hosted by Emily Liu. Catch past episodes on Spotify, Apple Podcasts or at Do you have a market mystery you want decoded? Drop us a note at btpodcasts@ --- Written and hosted by: Emily Liu (emilyliu@ With Hugh Chung, chief investment officer, Endowus Edited by: Chai Pei Chieh & Claressa Monteiro Produced by: Emily & Chai Pei Chieh A podcast by BT Podcasts, The Business Times, SPH Media --- Follow Market Focus Weekly podcasts every Friday: Channel: Amazon: Apple Podcasts: Spotify: YouTube Music: Website: Do note: This podcast is meant to provide general information only. SPH Media accepts no liability for loss arising from any reliance on the podcast or use of third party's products and services. Please consult professional advisors for independent advice. Discover more BT podcast series: BT Money Hacks at: BT Correspondents: BT Podcasts: BT Branded Podcasts: BT Lens On:
Straits Times
16-07-2025
- Business
- Straits Times
EU asset manager Amundi launches new fund in S'pore that tracks Straits Times Index
Find out what's new on ST website and app. The Amundi Singapore Straits Times will be the first unit-trust-based index fund tracking the STI by a global asset manager. SINGAPORE – European asset manager Amundi is launching a fund that tracks Singapore's benchmark Straits Times Index (STI) with investment platform Endowus. The Amundi Singapore Straits Times will be the first unit-trust-based index fund tracking the STI by a global asset manager in Singapore, both companies announced on July 16. The fund also commemorates SG60, a celebration of Singapore's independence and transformation into a global economic powerhouse, they added. The STI is a benchmark of Singapore's established listed companies. It has been hitting new highs, with an intraday high of 4,129.8 points reached on July 15. In 2024, it delivered total returns of 24.3 per cent – its best performance in a decade. 'Through the fund, investors can participate and grow alongside Singapore's ongoing growth story in a low-cost, meaningful way,' the companies said. Two other exchange-traded funds (ETFs) in Singapore already track the STI – the SPDR Straits Times Index ETF and the Nikko AM Singapore STI ETF. The three funds aim to replicate as closely as possible, before expenses, the performance of the STI. The SPDR Straits Times Index ETF was listed in 2002. Between Jan 1, 2020, and July 14, 2025, its assets under management increased by 131 per cent to $1.92 billion. Top stories Swipe. Select. Stay informed. Singapore July BTO launch to have over 4,600 balance flats, 2 BTO projects with less than 3 year wait times Business US tariffs may last well after Trump; crucial for countries to deepen trade ties: SM Lee Asia Indonesia police detain 12 suspects over baby trafficking ring linked to Singapore Singapore 'Kpods broke our marriage, shattered our children': Woman on husband's vape addiction Singapore Las Vegas Sands' new development part of S'pore's broader, more ambitious transformation: PM Wong Multimedia Telling the Singapore story for 180 years Life Walking for exercise? Here are tips on how to do it properly Singapore 'Nobody deserves to be alone': Why Mummy and Acha have fostered over 20 children in the past 22 years The Nikko AM Singapore STI ETF was listed in 2009. Between Jan 1, 2020, and July 14, 2025, its assets under management increased by 195 per cent to $973 million. Amundi South Asia chief executive Albert Tse said: 'We are proud to be the first global asset manager since the global financial crisis to launch a fund of this nature, leveraging our longstanding expertise in indexing solutions and trusted partnership with a home-grown financial platform like Endowus to deliver this to Singapore investors for SG60.' The STI has historically offered dividend yields relatively higher than regional bourses, the companies added. The STI also has historically offered lower volatility than global equity benchmarks, 'driven by Singapore's robust banking, real estate, telecommunications, and industrial sectors', they said. 'Amid global volatility, Singapore's equity market has been a pillar of stability.' Over the 18-year period from January 2008 to June 2025, the STI maintained an average dividend yield of 3.77 per cent, with yields generally between 3 per cent and 5 per cent. 'This positions the fund as an option for investors seeking stable income or defensiveness while maintaining exposure to the long-term growth potential of Singapore's economy,' the two companies said. The fund will be available exclusively on the Endowus platform at an all-in-one fee under an institutional share class. It also has no sales charge, and offers an option for investors wanting growth with relatively lowered volatility. The collaboration combines Amundi's global investment expertise in ETFs and index management with Endowus' digital-first platform. The launch of the fund comes amid efforts to boost the local equities market, with the Equities Market Review Group launched in 2024 to facilitate product offerings and improve liquidity, among other measures. 'The fund complements these by attracting additional capital to benefit local enterprises,' the companies said. Endowus chairman and chief investment officer Samuel Rhee said: 'As a home-grown brand, Endowus is proud to play a role in deepening financial access and supporting the aspirations of Singaporeans through every stage of their wealth journey. 'Investing in Singapore's most established companies is, in many ways, investing in the nation's continued prosperity.' SGX group head of securities trading Serene Cai said the growing interest in the STI reflects the resilience and relevance of Singapore's equity market as a core allocation. 'With close to $3 billion of listed assets tracking the STI today, the index continues to demonstrate its strength as a trusted benchmark – offering institutional and retail investors diversified exposure to Singapore's leading companies and delivering consistent performance over time,' she said. SPH Media editor-in-chief of the English/Malay/Tamil Media group Wong Wei Kong said: 'Even as Singapore commemorates 60 years of independence and The Straits Times celebrates 180 years this year, the STI will be looking forward to being 60 next year. It is truly an integral part of the nation's economic, business and market development.'
Business Times
16-07-2025
- Business
- Business Times
European asset manager Amundi, Endowus launch low-cost index fund tracking STI
[SINGAPORE] European asset manager Amundi and wealth adviser and investment platform Endowus on Wednesday (Jul 16) launched the Amundi Singapore Straits Times Index (STI) Fund. This marks the first unit-trust-based index fund tracking the STI by a global asset manager in Singapore. It will be available exclusively on the Endowus platform, at an all-in-one fee under an institutional share class. However, retail investors can also buy into the fund, according to Endowus. 'With no sales charges and low management fees, the fund offers another option for investors seeking growth with relatively lowered volatility compared to usual equity markets in their wealth journey,' noted the statement. The Amundi Singapore STI fund has a total expense ratio of 0.15 per cent, to further expand the low-cost indexing investment solutions available for STI investors, said Albert Tse, CEO Amundi South Asia. The fund does not incur additional trading costs, brokerage fees and exchange-traded expenses, Tse added. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up It aims to replicate the performance of the STI, which is driven by Singapore's banking, real estate, telecommunications and industrial sectors. In 2024, the STI delivered total returns of 24.3 per cent, achieving its best performance in a decade, both Amundi and Endowus noted. The index maintained an average dividend yield of around 3.8 per cent over the 18-year period from January 2008 to June this year, with yields generally between 3 and 5 per cent. This positions the fund as an option for investors seeking stable income or defensiveness, while maintaining exposure to the long-term growth potential of Singapore's economy, they noted. Other ETFs on the Singapore Exchange which track the STI include the Nikko AM Singapore STI ETF managed by Nikko Asset Management Asia, and the SPDR STI ETF managed by State Street Global Advisors Singapore. The launch of the Amundi Singapore STI Fund also aligns with broader efforts by the Monetary Authority of Singapore to strengthen the local equities market. It is designed to complement various policy initiatives and incentives by attracting additional capital to benefit local enterprises, the release said. Albert Tse, chief executive of Amundi South Asia, said: 'We are proud to be the first global asset manager since the global financial crisis to launch a fund of this nature, leveraging our longstanding expertise in indexing solutions and trusted partnership with a home-grown financial platform like Endowus to deliver this to Singapore investors for SG60.' Wong Wei Kong, editor-in-chief of the English, Malay and Tamil Media Group at SPH Media, said: 'We're delighted that the Straits Times Index will be the benchmark for Amundi's innovative new fund. As the STI looks forward to being 60 next year, it is truly an integral part of the nation's economic, business and market development.'
Independent Singapore
10-07-2025
- Business
- Independent Singapore
‘I want to retire in 20 years' — 26 y/o Singaporean Gen Z gets a sobering reality check on the true cost of quitting work by 45 in Singapore
SINGAPORE: At just 26 years old, Cheng Kai Xi has a bold dream: to hang up her office lanyard for good and retire by the age of 45. And she's not alone. According to CNA Insider's Money Mind survey, a full 30% of Gen Zs in Singapore share that same vision of a blissfully early escape from the working world. And two-thirds hope to retire within the next 30 years or less. But for Kai Xi, it's not just wishful thinking. It's a spreadsheet-backed mission. Photo: YT screengrab/@CNAInsider 'I'm looking to retire by the age of 45,' she told financial planner So Sin Ting, Chief Client Officer at Endowus . 'How much will I need?' Kai Xi asked to confirm the amount. The response was sobering… The million-dollar reality check 'Well, (for retiring at the) age of 45, that's a little bit aggressive,' Sin Ting replied, with the kind of gentleness used to cushion a financial gut-punch. 'I think that you would need at least S$2 million at the age of 45 to retire.' Let that sink in. Two. Million. Dollars. And that's just for a basic retirement—one where you're not popping champagne on a yacht every Sunday or flying first-class to Paris just because it's Wednesday. In addition, the figure assumes you've already paid off your housing and plan to spend about S$2,000 a month in today's money, which, after inflation, balloons to around S$35,000 annually in 2045. That number includes four decades of post-retirement life. 'The total cash flow that you need is about S$2.1+ million over 40 years,' Sin Ting calculated. Photo: YT screengrab/@CNAInsider That's when the dollar signs really started adding up. Can a Gen Z really pull this off? So, how does one climb Mount Financial Freedom with a modest backpack and only one year into full-time employment? Sin Ting ran through the math: Assuming a moderate return of about 7% annually, you need an initial investment of S$172,000+, or a monthly investment of S$1,321 starting now. Photo: YT screengrab/@CNAInsider That's more than a typical BTO downpayment—and you probably don't even get a house to live in at the end of it. Still, there's good news for those who aren't rolling in a six-figure inheritance. If you're starting with S$50,000, you'll need to invest about S$938 a month, said Sin Ting. Photo: YT screengrab/@CNAInsider Kai Xi, who lives at home, decided to be even more ambitious. She plans to kick off with S$20,000 in investments and set aside S$1,168 a month, well above the standard 20% savings rule. That's what happens when you skip avocado toast and move back in with mum and dad. Building the safety net first But before she throws all her cash into ETFs and index funds, Sin Ting urged caution. 'I think you should first look at setting up an emergency fund. Life can be unpredictable sometimes,' she advised. The magic number would be six months of expenses, saved and ready to go in case life throws a financial curveball—like retrenchment, a hospital stay, or a wedding you can't RSVP 'no' to. Fortunately, Kai Xi is already ahead of the curve here. But she's also juggling another major financial milestone: owning her own home. Juggling goals like a pro 'Other than retirement, I'm also thinking of saving for my own house,' she asked. 'So, how do I do both?' You'll need to have separate investment portfolio goals, said Sin Ting. One for retirement and one for housing. Photo: YT screengrab/@CNAInsider This means allocating funds differently depending on the timeline. Housing might be seven to ten years away, so that would go into a balanced portfolio—think 60% equities and 40% fixed income. Retirement, on the other hand, is nearly two decades away. This allows for a more aggressive strategy, such as a full equities portfolio. 'I have a short-term liquidity fund, a medium-term housing goal in a balanced portfolio, and a long-term retirement plan in aggressive equity funds,' Sin Ting shared about her own strategy. 'Investing is about taking calculated risks and being compensated for that.' CPF: The invisible muscle in your financial plan One often-overlooked asset in the retirement toolkit is your good ol' friend and lifesaver, CPF. 'Think about how you can maximise your CPF (your pension money),' Sin Ting advised. It's a significant part of our monthly income in Singapore. Consider topping it up, or even investing your CPF money, she advised further. But there's one more lever Kai Xi needs to pull: her income. She will need to increase her base to be able to grow it. Whether that means upskilling, taking on side gigs, or chasing promotions. You can't simply save your way to millions without boosting how much you earn. Photo: YT screengrab/@CNAInsider Perhaps she can draw inspiration from young Singaporeans like Darien and Joanna, who transformed their home into a multi-stream income engine, generating over S$3,000 to S$5,000 a month through practical, proven side hustles that are perfect for 2025. You can read more about their story here: 'We make S$5000/month!' — Singaporean couple turns their S$1M condo into a passive income machine with 10 side hustle recommendations, working from home And remember: keeping your money in cash isn't as safe as it seems, either. 'Staying in cash is not risk-free. Your money gets eaten away by inflation,' Sin Ting warned. So that S$1,000 today will be worth less in ten years. The automation advantage and levelling up your income For those struggling with discipline, automation is your best friend, so you don't have to always think about it or remember to do it. 'Try to automatically sweep a certain amount from your savings into your investment portfolio on a monthly basis,' Sin Ting suggested. Photo: YT screengrab/@CNAInsider This way, 'you're dollar-cost averaging (growing your wealth) over time.' Keep your eyes on the prize So, how will Kai Xi know she's on track? 'Review your investment portfolio at least once a year,' said Sin Ting. 'You want to make sure your portfolios are still appropriate (aligned) with your goals and risk tolerance. If your personal circumstances change, you should adjust your investments (too).' In other words, financial planning isn't always just a 'set it and forget it' microwave meal. It's more like meal prep—annoying at times, repetitive at other times, but ultimately delicious when done right. Facing her financial future… After crunching the numbers and mapping out her plan, Kai Xi is now facing her financial future with newfound clarity. Armed with a detailed investment plan, a high savings rate, and expert advice, she's more than just hopeful—she's strategic. Photo: YT screengrab/@CNAInsider She now knows what she needs to do to achieve her goals with confidence and realism. Will she really make it? Will she actually retire at 45? Only time—and the markets—will tell. But one thing's for sure: this Gen Z isn't just dreaming. She's all for doing the math to make her dream, not just a dream. Watch the full CNA Insider Money Mind episode below to see how Kai Xi maps out her retirement plan with expert advice and guidance as she embraces the financial truths every young Singaporean should know about that could change your own financial and future game plan. No group is embracing the hustle culture harder than Gen Z. Around 40% of them have already taken on side gigs, not necessarily because they love it, but because they need the extra income to retire early, just like Kai Xi. And here's where it gets inspiring: many of these young workers are turning what began as side hustles into full-blown six-figure careers. Let's dive into how they're doing it—and how we in Singapore can also replicate that with another 5 genius ways Singaporean Gen Zs can turn side hustles into six-figure careers with just $5 or less and a smartphone
Business Times
16-06-2025
- Business
- Business Times
Navigating private credit – how it compares with T-bills and publicly issued bonds
[SINGAPORE] Private credit is rapidly gaining traction among retail investors as regulators around the world are giving these individuals more access to private markets in general. Private credit refers to a type of debt negotiated between non-bank lenders and companies that are often below investment grade and unlisted. The asset class flourished after the global financial crisis, when banks cut lending amid fears that they would not be able to recover the debt. Since 2009, the global private-credit market has grown more than 10 times, with assets under management exceeding US$3 trillion as at end-2024. In Singapore, the size of retail demand for private credit could grow to as much as S$100 billion, said Hugh Chung, chief investment officer at Endowus. This is assuming that 5 per cent of the S$1.9 trillion of total household financial assets is allocated to the asset class. How should retail investors navigate this asset, particularly as the Monetary Authority of Singapore is assessing feedback to its proposal to broaden access to it? First, let us have a look at how private credit usually works. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Assuming you are the chief executive officer and majority owner of an unlisted company, with earnings before interest, taxes, depreciation and amortisation of between US$50 million and US$100 million. You want to raise capital but cannot access traditional bank lending because your business is too small. You may not have an extensive credit history, which would limit your ability to raise funding through debt markets. You also want to keep your ownership, so you do not want to sell a stake to private-equity firms or investors. Why borrowers turn to private credit In such a scenario, the most feasible option is private credit. This is where you negotiate a loan with lenders such as insurers, pension funds, or high-net-worth individuals who are more comfortable with your risk profile than banks are. Listed companies may choose private credit as well, such as when they want to finance a project in a politically unstable country. In uncertain economic environments, such as the current one in which US tariffs and their frequent changes are complicating business planning, demand for private credit may still be robust. Sally Yim, managing director of financial institutions at Moody's Ratings, told The Business Times: 'There might be a more volatile environment, causing banks to be more cautious about lending to borrowers of lower credit quality... so private credit can help fill the gap.' Private credit also enables borrowers and lenders to structure more tailored deals than traditional lending. Creditors often price the loans at a premium to the prevailing benchmark interest rates, as these loans are seen as being more risky than those taken up by bigger corporates with more extensive credit histories. As with other private assets, private-credit investors also receive the illiquidity premium, to compensate for the lack of liquidity in holding such alternative investments. Debtors are willing to pay higher rates, given that they have limited access to other funding routes in the first place. They can also get loans tailored to their needs, with more flexible terms. In theory, this results in a win-win situation for lenders and borrowers. Returns vs risk Mark Glengarry, Blackstone's head of Asia-Pacific for private-credit strategies, said: 'Private credit can offer companies a more direct and efficient way to access capital, resulting in greater speed, certainty in execution, and flexibility of structure. For investors, there's a broader receptivity to private markets, with more (of them) recognising that assets such as private credit can be a core portfolio building block, potentially helping to improve returns, to lower volatility and diversify portfolios.' While private-market players position private credit as long-term investments that generate high yields, they caution that, ultimately, returns are not guaranteed. Investors may also not recover their full investment if the borrower defaults. In contrast, government-backed Treasury bills (T-bills) guarantee capital and typically present the lowest risk, with a nearly zero chance of default. Investment-grade corporate bonds are also less risky than private debt, since the issuers tend to have higher credit quality. Asset manager Schroders pegs the average annual default rate of such debt at 0.1 per cent over the long run. Shihan Abeyguna, managing director for South-east Asia at Morningstar, said: 'The risk for private-credit funds is high simply because of the risk of default by companies that could be sub-investment-grade.' In the United States, the 25-year average of leveraged loan default rate is 2.4 per cent, said US private-markets investment firm Hamilton Lane. As with most investment tools, higher risks are usually accompanied by higher returns. A US middle-market debt offering, while illiquid and unrated, can generate a potential return premium of 400 to 600 basis points over US high-yield bonds, together with added protections such as covenants and collateral, said Dennis Quah, head of Singapore wealth at BlackRock. According to MSCI, global private-credit funds generated returns of 10.2 per cent in 2023, and 6.9 per cent in 2024 – higher than their private-equity counterparts. They also outperformed investment-grade bonds, which yielded returns of 8.3 per cent and 2.5 per cent for those two years, respectively. However, during those two years, private-credit funds underperformed the MSCI high-yield corporate bond index, which tracks US dollar-denominated bonds that are not investment grade. One-year Singapore T-bills, on the other hand, averaged 3.75 per cent in 2023 and 2.78 per cent in 2024. In the latest auction in April, the yield fell further, to 2.29 per cent. Buyer beware While the higher returns are tempting, investors need to bear in mind that private-credit funds are long-term investments, with the maturities of the underlying debt going beyond a decade. In contrast, T-bills can mature after a month. BlackRock's Quah said 'private-credit instruments are still generally longer-dated investments than public equity and bonds, so investors should seek investment managers with deep expertise and experience navigating multiple market cycles'. Private-credit funds are also less liquid than investment-grade bonds that are publicly traded. Moody's Yim said: 'It's something that we need to be more cautious about when retail investors get into these private-credit funds – whether they understand the differences in terms of liquidity risk.' To lower such risks, retail investors could consider allocating 5 per cent of their portfolios to private credit, with at least a six to 10-year horizon, said Abeyguna. 'These assets can complement traditional fixed income by offering differentiated sources of income and risk, but should be sized carefully, based on an individual's overall objectives and risk tolerance.' To generate resilient incomes, Blackstone's Glengarry said the firm targets high-growth and low-loss sectors. It also structures its loans as senior secured, 'with significant equity cushion or credit enhancement'. Secured by collateral, senior secured loans are at the top of a company's capital structure, meaning they are repaid first in the event of bankruptcy or liquidation.
