Fixed Income Funds

If you have cash now and find that the stock market has run up too high for your pocket, then what do you do with the extra cash so that you can earn decent returns? What if you are a conservative investor or a retiree and can’t stomach the “excitement” in the stock market, what is your strategy?

In my case, I buy into funds that provide fixed income from bonds, deposits and money market instruments bought by the funds. These funds are commonly known as Fixed Income Fund. The financial assets being invested in by the funds are the ones that have regular interest payouts. The portfolio investment strategy is not for quick and spectacular capital gains in the underlying financial assets. Instead, they invest in bonds and money market instruments, e.g. short term deposits, government bonds, corporate bonds, for the regular income payments.

The Fundsupermart website (http://www.fundsupermart.com/) listed their top volume Fixed Income Funds:

1. Cash Fund – Prudential Asset Management

2. DBS Enhanced Income SGD

3. ABN AMRO Funds Global Emerging Markets Bond Fund (Euro)

4. DBS Shenton Income

5. Lion Capital SGD Money Market

The risk ratings of these funds are normally conservative or of a lower risk. This has to be confirmed in that the fund could be investing in financial instruments that carry higher risks even they have a history of good income payouts.

Written on 2/23/2007 4:09 PM

Copyright © 2007, the author known as LKT in Singapore.

The material presented is intended to be general and written in layman’s language as much as it is possible. The author shall not be liable for any direct or consequential loss arising from any use of material written. Please seek professional advice from your financial advisor or financial institutions on material written covering financial matters.

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