THE unit trusts and investment-linked insurance products (ILPs) included under the Central Provident Fund Investment Scheme (CPFIS) generated positive returns on average in the fourth quarter of 2015, but dipped into negative territory on a full-year basis.
In the three months ended Dec 31, 2015, the overall performance of the 280 CPFIS-included funds posted positive returns of 3.01 per cent on average.
The 103 CPFIS-included unit trusts’ average returns grew 3.27 per cent, while the 177 CPFIS-included ILPs rose 2.84 per cent.
All CPFIS-included, all asset types of funds posted positive returns. Equity and mixed-asset posted positive returns of 3.87 per cent and 2.37 per cent, while bond and money market types posted 0.30 per cent and 0.17 per cent, respectively, for the quarter.
In the same period, the MSCI AC Asia (excluding Japan) Index rallied 3.64 per cent, while the Citigroup world government bond index (WGBI) slid 1.45 per cent.
For the full year, the overall performance of CPFIS-included funds remained flat, with a slight decline of 0.19 per cent on average.
CPFIS-included unit trusts fell 0.08 per cent on the year and CPFIS-included ILPs fell 0.26 per cent on average.
During this period, Citigroup WGBI TR rose 3.23 per cent, while key benchmark MSCI AC Asia (excluding Japan) Index slid 2.47 per cent.
For the one-year period, bond offerings (+1.74 per cent on average) outperformed equity products (-0.71 per cent on average), mixed-assets (+0.04 per cent on average) and money market types (+0.58 per cent).
For the three-year period, CPFIS-included funds reported a strong 20.07 per cent growth on average, due to the gain of 23.18 per cent on average from CPFIS-included unit trusts and 18.19 per cent on average from CPFIS-included ILPs.
The MSCI AC Asia (excluding Japan) Index gained 14.92 per cent over the same period, while Citigroup WGBI TR rose 7 per cent. Equity type was the lead gainer with growth of 26.25 per cent while money market portfolio posted 1.20 per cent on average.
Said Xav Feng, head of Asia Pacific research for Thomson Reuters Lipper: “2016 will be a challenging year for investors. Global financial markets are increasingly driven by headlines, with markets swinging dramatically on the back of central bank announcements.”
He added: “Low oil prices are expected in the coming months due to persistently high supply. Weak PMI (purchasing managers’ index) data out of China is disquieting, as is the dislocation between markets and the US Federal Reserve’s interest rate hike schedule.
“Investors should remain cautious in this uncertain environment, but market volatility may introduce new opportunities for the careful investor.”
The Investment Management Association of Singapore (IMAS) and Life Insurance Association of Singapore (LIA Singapore) have appointed Lipper to monitor the performance of all unit trusts and investment-linked insurance products included under the CPFIS.