ABF Singapore Bond Index Fund

The iBoxx ABF Singapore Bond Index comprises Singapore dollar bonds issued by the Singapore Government or Singapore Government-linked entities (e.g. Housing Development Board, Temasek, and Land Transport Authority). The Index may also include Singapore dollar bonds issued or guaranteed by other Asian government, quasi-government or supranational organisations (e.g.Export-Import Bank of Korea, Korea Development Bank).

The Index is compiled and calculated by Markit Indices Limited using independent and multi-source pricing for improved accuracy.

The Index is re-balanced monthly on the last calendar day of the month after close of business. Changes to static data, such as ratings, amount outstanding etc. are only taken into account if they are publicly known three business days before the end of the month. Rating or amount outstanding changes on the last two trading days of the month are accounted for at the next re- balancing. New bonds issued must settle before the end of the month and all relevant information must be known at least three trading days before the end of the month.

For more information on the description of the index methodology and the latest information relating to the Index, please refer to www.markit.com/product/iBoxx.

1. Basket of majority AAA-rated Singapore government bonds

   Singapore is the only Asian country that has the highest AAA credit rating awarded by all 3 major credit rating agencies. Singapore has retained this status throughout the last 15 years, covering multiple periods of economic crisis, including the Asian Financial Crisis in 1997 and the Global Financial Crisis in 2008. Singapore's AAA credit rating is supported by its USD 293 billion* of official foreign reserves and a prudent fiscal policy characterised by consistent government budget surpluses. As a result, Singapore government bonds possess a safe haven status that investors turn to during periods of market uncertainty.

   * Monetary Authority of Singapore, as of February 2019 (preliminary)

   

   Source: Bloomberg, Nikko AM Asia, as of 14 March 2019.

2. Excellent risk adverse play during periods of market stress

   Historically, the Index has performed exceptionally well during periods of difficult market conditions. Due to its high credit quality and the strength of the Singapore Dollar, Singapore government bonds are perceived as a safe haven asset during market distress. This makes the Index an excellent diversifier for strategic asset allocation purposes to improve risk-adjusted returns of a portfolio.

   

   Source: Bloomberg, Nikko AM Asia, as of 28 February 2019. The chart is for illustration purposes only. Past performance is not indicative of the future performance.