NTUC Income has launched a new fund, Asian Bond Fund that intends to distribute monthly dividend payout of 4.5%-5.5% per annum.
The Asian Bond Fund aims to provide a medium to long-term rate of return by investing mainly in Asian Fixed Income Securities. The sub-fund is invested in the BlackRock Global Funds– Asian Tiger Bond Fund A6 SGD Hedged Share Class (the underlying fund).
The underlying fund will invest at least 70% of its total assets in the fixed income transferable securities of issuers domiciled in, or exercising the predominant part of their economic activity in, Asian Tiger countries (i.e. South Korea, the People’s Republic of China, Taiwan, Hong Kong, the Philippines, Thailand, Malaysia, Singapore, Vietnam, Cambodia, Laos, Myanmar, Indonesia, Macau, India and Pakistan). The underlying fund may also invest in the full spectrum of available securities, including non-investment grade. It may use financial derivative instruments for efficient portfolio management or to hedge market, interest rate and currency risk.
The sub-fund offers a monthly payout feature and intends to provide a monthly distribution with effect from 27 May 2016. The Manager intends to pay the distribution within 45 days from the declaration date. The declaration date is set on the 3rd last business day of every month. The declaration date is subject to review and the Manager has the sole discretion to determine the rate and frequency of the distribution. Distributions are not guaranteed and can be made out of income, capital gains, and/or capital of the sub-fund.
More importantly, NTUC Income will guarantee 105% of the investment amount or cash value, whichever is higher, in the event of untimely death or Total Permanent Disability (TPD before age 70) before age 65. After age 65, it is 100% of the investment amount or cash value, whichever is higher, in the event of untimely death. This is on top of the monthly withdrawal of the dividends over the years.
The minimum single premium to invest is $10,000.
Fund Manager: NTUC Income
Sub-Investment Manager: BlackRock (Luxembourg) S.A.
Initial Sales Charge: 3% (For single premium and top-up)
Annual Management Fee: 1% p.a.
Annual Policy Fee from 2nd year onwards: $50, waive if investment amount is $25,000 and above.
For example, below is the hypothetical illustration of how the dividend will be calculated.
|Number of units||$100,000/$1 = 100,000|
|Dividend Rate||$0.004053 per unit|
|Dividend payable||100,000*0.004053 = $405.30|
Subscription Method: Cash/SRS
Asian Bond Fund Factsheet is here at http://www.income.com.sg/fund/pdf/2016/asianbond(may).pdf
Asian Bond Fund Product Highlight Sheet is here at http://www.income.com.sg/fund/phs/2016/asianbond(dec).pdf