Small investors with just $1,000 now have a chance to dabble in an investment fund linked to Temasek Holdings.
Temasek's Fullerton Fund Management has tied up with DBS Bank to launch the new investment fund with a focus on Asian equities and fixed-income securities.
The Fullerton Total Return Fund, launched in mid-April, is the first balanced product that allows retail investors to tap the fund manager's institutional investment capabilities.
It aims to pay quarterly distributions to investors in the retail share class.
Fullerton Total Return Fund also offers an institutional share class, which carries a 6 per cent a year hurdle rate - essentially a minimum rate of return before the fund manager gets a performance fee. The annual rate of return will include dividends re-invested.
The fund combines income and potential capital gains with lower volatility than a pure equities fund and thereby aims to provide investors with a consistent return over a market cycle, said Fullerton and DBS in a joint statement.
"We believe that this product, which brings together our expertise in Asian equities and fixed income, as well as asset allocation, provides a unique, all-weather solution for investors looking to enjoy both stable income and total return in varied market conditions," said Mr Manraj Sekhon, Fullerton's chief executive and chief investment officer.
The minimum subscription for retail investors to participate in the fund is $1,000 and $100 for any subsequent investments. Investors can choose to invest in either Singapore dollars or US dollars.
Foreign currency exposure will be actively managed to help mitigate the volatility of returns.
The minimum subscription and subsequent investment for institutional investors is $10 million and $1 million respectively. DBS is the fund's sole distributor.
"Asia's fundamentals have remained resilient despite challenges to the global economy," said the fund's lead manager Mr Gerard Teo, head of Fullerton's strategy and currency team in a statement.
"Notwithstanding this, periods of market stress have become more frequent," he said, adding that the fund will employ a tactical asset allocation to mitigate volatility while staying focused on Asian asset markets, its core competency, to generate returns.
The fund offers an opportunity to retail investors looking for ways to make their money work harder amid current inflation without taking on too much risk, said Mr V. Arivazhagan, DBS' managing director, regional investment and treasury products head.
A similar fund rolled out in January last year, the Fullerton SGD Income Fund, has reached more than $1.5 billion in size.