My Unit Trust Asset Allocation
Dear all,
After nearly one year, I guess it is time for another summary on my unit trust asset allocation. You can refer to my previous one at the link below:
https://ghchua.blogspot.com/2024/09/my-unit-trust-asset-allocation.html
For asset classes, I have done nothing much other than consistently adding onto the list of unit trusts that I had been holding for CPF Investments. I have again been defensive for the past one year or so, and therefore increased my allocation to short duration bond fixed income fund again. The other asset classes are obviously down correspondingly in terms of percentage of allocation, with my additional allocation to the short duration bond fixed income fund.
For geographic exposure, Emerging Markets, Japan and Singapore funds were the out performers in the portfolio. Asia excluding Japan funds also did well.
Laggards are mainly single country funds. Most of these single country funds were in emerging/developing markets and the likes of India, Thailand, Indonesia and Malaysia each have their own country specific issues for the past year, which affected their respective stock market performance.
Going forward, my strategy is to add onto existing funds, while continue to maintain a more defensive positioning in terms of asset allocation. I will continue to allocate more to fixed income instead of equity, with emphasis on shorter duration to mitigate interest rate fluctuations. I will also stick more to global, regional and developed markets single country funds to mitigate emerging/developing markets country specific risks.
Asset Class
Equity 79.53%
Balanced 12.82%
Fixed Income 7.65%
Geographic
Global 21.26%
Asia Pacific Excluding Japan 15.44%
Emerging Markets 13.41%
Japan 12.35%
US 8.32%
Singapore 8.29%
Asia excluding Japan 6.40%
Taiwan 3.22%
Europe including UK 3.05%
India 1.95%
Thailand 1.80%
Indonesia 1.78%
Malaysia 1.43%
Korea 1.40%
Welcome any comments (if any) on my unit trust asset allocation.
Labels: CPF, Others, Portfolio, Strategy, Unit Trust
posted by ghchua at 3:44 PM
6 Comments:
Dear ghchua, Will be glad if you could post which are the potential star performers funds you have invested in or considering to assist readers in deciding how to allocate their CPF funds between unit trusts and lower cost ETFs. What are your views on FSMOne recommended unit trusts and ETFs? I notice that unit trust of different fund house can differ widely in their performance even though they may invest in the same region. Since you specialize in investing in SG small and mid caps, do you mainly unit trusts that invest in this sector too?
mainly buy unit trusts that invest in this sector too?
Such as Aberdeen Asian Small Caps
Hi weii,
I don't select funds based on "star" performance. Rather, I start off with asset allocation first and then select funds based on the asset class and geographical focus that I am interested in. Which is why I only disclosed my unit trust asset allocation, because I feel that it is the most important part of unit trust investing. As I have said before, I have previously disclosed all my unit trust holdings on FSM platform and provided a link from my blog. However, they have decided to stop that service and therefore I have decided to provide only asset allocation information.
As to the decision between unit trusts and ETFs, I mentioned that this unit trust portfolio is only invested using CPF funds. As there are limited number of ETFs included for CPF Investments, I have utilized them mostly for unit trust investment as they cover a wider range of asset allocation and geographical exposure. However, I do hold one ETF under my CPF Investement currently, which is Streettracks STI ETF as disclosed in my blog.
I don't really look at FSMOne recommended unit trusts and ETFs as most of them in the list are not included for CPF Investments. I have a different criteria when selecting funds to invest. I normally look for lower expense ratio rather than past performance.
For CPF Investments, there is currently no such fund available with exposure only to Singapore mid and small cap stocks.
As I have mentioned before, I only utilize CPF funds for unit trust investment and therefore my focus is only on those funds included under CPFIS. For cash investment, I only focus mainly on individual stocks.
Hope that the above answer most (if not all) of your questions.
Thanks for sharing. For the benefit of readers, FSMOne current recommended equity funds that can be purchased using CPF are Eastspring Pan European SGD and Allianz Best Styles Global Equity H2 SGD. Let me know if you have any comments on their strategies etc. Do you allocate all of your CPF available into unit trust for both OA and SA. I currently allocate all CPF OA to unit trusts and ETFs including Amova SGD bond ETF.
Hi weii,
Eastspring Pan European SGD is an actively managed Europe equity fund. The expense ratio of the fund is on a high side at around 1.74%pa, which is almost at CPF limit of 1.75%pa. Personally, I am using an index fund for exposure to European equities for my CPFIS.
Allianz Best Styles Global Equity H2 SGD I am not too sure as I already have existing global equity funds and so won't be looking to add another one. I would recommend you to get a global index fund if you can, as the expense ratio is lower.
Yes. I do invest almost all of my CPF OA and CPF SA funds beyond the amount that could not be invested. I aim to stay almost fully invested at all times, though there might be some cash drag from dividends and I might wish to accumulate more before investing. For CPF SA, I only invest in balanced funds as equity funds could not be used and bond funds will most likely not beat 4%pa interest rate.
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