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Many investment avenues such as the stock market require a significant amount of money to start and make decent profits. Unfortunately, not everyone has enough money to invest there. Or perhaps enough money to put in attractive investment options such as real estate. Fortunately, the concept of unit trusts allows you to get your foot through the door for much less than you would have required if you decided to venture into the said investment alone.
What are unit trusts?
A unit trust can best be described as a pool of funds where investors pool their money and the amount is invested in various asset classes including property, bonds, stocks, and others. Fund managers are in charge of the unit trusts and they decide where the money will be invested for secure and optimal returns. The profits from those investments are divided amongst the investors based on the number of units that they own in the fund. Unit trusts operate under trust deeds which differentiate them from mutual funds.
Unit trusts can lose money especially if the fund managers put the money in the wrong type of investments or if something happens that leads to losses in the investment. You can limit your exposure to those risks by investing in a unit trust whose managers understand risk assessment and diversification for ironing out the risk exposure. Here are some of the best unit trusts that Singapore investors should consider.
UnitedAsia Pacific Real Estate Income fund
It is one of the most successful unit trusts in Singapore thanks to smart investments in the real estate market. Thanks to this investment, its returns have been favorable to investors in the past few years. However, 2020 had its challenges and there was a notable dip in the unit trust’s performance. However, real estate is still one of the most lucrative areas and UnitedAsia Pacific Real Estate Income fund is expected to recover. That recovery might provide potentially lucrative and high-growth investment opportunities for anyone planning to invest in a unit trust fund.
Lion-Bank Of Singapore Asian Income FD A DIS SGD-H
The fund managed to gain 12.64% in the last 12 months, making it one of the best performing unit trusts in Singapore. Its performance was quite impressive given the highly unfavorable economic conditions brought about by the pandemic. Nonetheless, it managed to outperform the challenges. A single unit of the fund is currently priced at 1.2040 SGD. It last gave a dividend at 0.0111 SGD and the current dividend gross yield is set at 3.69%. it also has a one-year return rate of 17.57%. Its ability to withstand the immense challenges of 2020 and deliver strong returns plus the above figures highlight the fact that it looks attractive as an investment. It is ideal for an investor that wants to strike a good balance between growth and risk appetite.
FSSA Dividend Advantage Fund SGD
This unit trust was set up to seek long-term growth opportunities from equity investments in the Asia Pacific region. The fact that it has expanded its investment activities to include other Asia Pacific regions outside Singapore highlights the commitment to generating as much value as possible for investors. The price per unit of this unit trust is currently at 2.4164SGD and it has a 3.78% indicated dividend gross yield. The last Reported dividend was 0.0229 SGD and its current 1 year Return is 25.11%. The fund’s current position looks strong especially now that the markets are recovering from the pandemic-induced recession.
BGF ESG Multi-Asset Fund A8 SGD-H
The fund invests globally in equities including high-income fixed and transferable equities, money market instruments, deposits, cash and other investment avenues. The fund’s performance has been bullish ever since the dip it experienced in March 2020 and it has overall gained 10.66% in the last 12 months. Its price at the time of this press was 10.9400SGD and its last reported dividend was 0.0225 SGD while dividend gross yield was 0.21%. It’s one year return rate is currently 10.17%. The fund plans to tap into the ongoing economic recovery and the resulting opportunities for more gains in 2021.
Aberdeen Standard Asian Smaller Companies Fund SGD
The fund was launched in 2006 In Singapore and it already has a strong performance track record. The unit trust invests 99% of investor cash on equities with a particular focus on the Asian market. Its current indicative price is around 2.5917 SGD while its one-year return rate is 11.63%. The
The fund demonstrated impressive performance especially in the fourth quarter of 2020, indicating that it was reaping big from the economic recovery. The global economy and particularly the Asian markets are still in recovery mode, which means that there is still some potential upside.
Schroder Asian Income SGD A DIS
It is one of the ideal unit trusts that Singapore investors can indulge in especially if they target medium and long-term gains. Another key aspect of this unit trust is that it invests in fixed income securities in Asia, as well as Asian equities, thus highlighting a strong diversification aspect. The unit trust’s current indicative price at the time of this press was 1.119 SGD and the price has been overall bullish especially in the three to four months. The recovering economies in the Asia pacific region might continue to favor the fund, assuming that the vaccine rollouts are held in a timely manner and they facilitate the return to normalcy.
FIDELITY ASIA FOCUS FUND A SGD
The fund has been around since 2006 and it is based in Luxembourg although it has its operations in multiple countries including Singapore. It has a particular focus on key Asian markets including Hong Kong, China, Taiwan, Vietnam, Thailand, Macau and India. The unit trust has been bullish especially during the second half of 2020 courtesy of economic recovery. it has an annual return rate of 22.99% and majority of its investments are in equity. This means that it is well positioned to leverage growth from many recovering industries.
