We have refreshed the Morningstar Medalist Rating methodology to improve transparency, consistency, and comparability across funds. The Medalist Rating is Morningstar’s forward-looking assessment of funds, helping investors identify those expected to outperform within a category. Changes under the new methodology offer a fresh read on which funds stand out and which may be worth reconsidering.

Under the updated approach, ratings are now assessed on a category-relative basis, and funds are no longer graded on a forced distribution curve. Previously, this curve limited the number of Gold-, Silver-, and Bronze-rated funds within each category. It has been replaced by fixed thresholds, which will also help to create a more stable set of ratings.

A key enhancement is the introduction of a dedicated Price Score. Previously, fees were incorporated by deducting them directly from a fund’s pre-fee score. To improve clarity, we now assign an explicit Medalist Rating Price Score, which ranges from negative 2.5 to positive 2.5 based on a fund’s fee percentile within its category. Our recent research, [The Enduring Predictive Power of Fees](https://www.morningstar.com/en-hk/business/insights/research/asia-predictive-power-of-fees) in Asia, reinforces that fees remain one of the strongest predictors of a fund’s future success, and this new measure helps reflect that relationship in a more transparent way.

Importantly, the core of our assessment remains unchanged. We continue to evaluate funds based on three fundamental pillars: People, Process, and Parent.

We have implemented the updated methodology across all rated funds at once, so current ratings already reflect the new approach. For more details, please refer to our [column](https://www.morningstar.com/funds/why-are-we-updating-our-medalist-rating-simpler-is-better) that talks about the impact of the changes.

**Impact on Funds’ Medalist Ratings**

Where rating changes have occurred under the updated methodology, they have typically been limited to a one-notch movement. Meanwhile, at an aggregate level, the changes have resulted in more Gold and Silver ratings, and fewer Bronze, Neutral, and Negative ratings.

Looking at the impact by Morningstar Category, some categories were more affected than others, reflecting the shift toward category-relative assessments and the varying influence of fees. A notable example is the US large-cap category, where the relatively low alpha potential previously constrained active funds’ ability to achieve higher ratings. Under the new methodology, some funds with strong fundamentals and reasonable fees are seeing upgrades. Allocation funds are another category with a relatively higher number of upgrades, with the newly introduced Medalist Rating Price Score helping to better capture the fee relativities within a given Morningstar Category.

In identifying funds that saw rating changes (Exhibit 1), we focused on analyst-rated strategies across core asset classes that Asia-based investors commonly consider when building their portfolios. These include categories such as US Large-Cap Blend Equity, Asia ex-Japan Equity, Global Diversified Bond, and Asia Bond. To ensure relevance, we included only retail share classes available for sale in at least one of the region’s three major markets: Hong Kong, Singapore, and Taiwan.

**Exhibit:1  Funds (Retail Share Classes) in Asia That Saw Medalist Rating Changes**

![Screenshot 2026-05-25 140318.png](/uploads/Screenshot_2026_05_25_140318_1ad08d1368.png)

We take a closer look at a few prominent funds to highlight whether their retail share class saw a rating change and the key drivers behind these moves.

BGF Asian Tiger Bond: The fund draws on strong research resources and a team with a clear focus on identifying value across Asian bond markets. These strengths merit Above Average scores for both the People and Process pillars. Combined with the retail share class’s reasonable pricing, which sits in the middle quintile of the category, this supports a Medalist upgrade to Bronze. Meanwhile, several lower-cost share classes saw more pronounced upgrades, with the cheapest institutional share class moving from Bronze to Gold.

BGF Global Allocation: Under the previous methodology, allocation funds often found it difficult to achieve Gold, Silver, or Bronze ratings due to the challenges these strategies faced in outperforming their category benchmarks after accounting for their relatively higher costs. Under the new approach where fees are considered on a peer-relative basis, the underlying strengths of many of these funds shine through more clearly, resulting in a higher number of upgrades across the category. Few global balanced funds match the BGF Global Allocation in terms of disciplined risk oversight, strategic thinking, and depth of resources. These strengths help the fund stand out in the category and support a one-notch upgrade to Bronze for its A2 retail share class.

BGF Global Multi-Asset Income: The strategy has witnessed some recent leadership turnover and uneven team depth across its underlying investment sleeves, which tempers our conviction in this multi-asset, income-oriented strategy. Furthermore, the A2 retail share class’s high fees, which sit in the second-most-expensive quintile within an already pricey category with a median fee of 1.5% per year, continue to hold back its rating at Neutral under the new methodology. On the other hand, the more reasonably priced D2 and D6 share classes, which sit in the cheapest quintile among peers, saw a significant boost to their ratings, moving from Neutral to Silver.

Capital Group New Perspective Fund: The strategy boasts an accomplished management roster and a deep global analyst bench, combined with a proven investment approach. These fundamental strengths shine through, resulting in a one-notch upgrade for its B share class to Bronze.

Morgan Stanley Global Opportunity: This popular global large-cap growth offering is led by an excellent manager who employs a highly distinctive approach. While the strategy boasts many strengths, the high fees of its A retail share class, which sits in the most expensive quintile of its category, keep its rating at Neutral. That said, the strategy’s lower-cost I share class, which sits in the second-cheapest quintile, received a one-notch higher rating of Bronze.

Pimco GIS Income Fund: This fund behemoth is run by Dan Ivascyn, who manages this aggressive, wide-ranging strategy with many levers at his disposal to produce an appealing yield, resulting in a High People score and Above Average Process rating. However, the E retail share class does not see a change from its Bronze rating. The share class sits in the most expensive quintile versus peers, which holds it back from achieving a higher rating. Meanwhile, the strategy’s cheaper Institutional share class received a one-notch increase from Silver to Gold. This is notable given the increasing availability of these lower-cost share classes on certain fund distribution platforms in Asia.


Which Funds in Asia Saw Rating Changes?

Private asset classes have long been a mainstay of institutional investor portfolios, but they have become increasingly accessible to individual investors. Hong Kong and Singapore, like many parts of the world, have also seen growing investor interest in these products, which provide access to less‑liquid asset classes such as private credit and private equity.

However, the reality is more complex than the “democratization” narrative suggests. Semiliquid structures must balance competing objectives: improved access versus elevated risk, managers’ drive for revenue versus appropriate fee structures, and investors’ demand for regular liquidity versus the illiquid nature of private assets. 

![Semi.png](/uploads/Semi_6b55e20f7a.png)

****Investor Eligibility ****
In both Hong Kong and Singapore, private market products are the exclusive preserve of sophisticated investors. Investors must qualify as “Professional Investors” in Hong Kong or “Accredited Investors” in Singapore, with eligibility determined by portfolio size, net assets, income, or financial assets. Minimum investment amounts vary widely, from tens of thousands of US dollars through to several million US dollars, depending on the structure and strategy.

Common semiliquid structures in both markets include SICAV Part II funds and master‑feeder funds, including Cayman‑domiciled vehicles. These structures are typically open‑ended and evergreen in nature, offering periodic subscription and redemption windows rather than daily dealing. While they provide an access point to private assets, they remain subject to gated liquidity and capped repurchase terms.

**Liquidity Management**
Liquidity management sits at the heart of semiliquid fund design. While some vehicles hold cash or liquid assets to meet withdrawals request, most rely on periodic liquidity windows with advance notice requirements. Many semiliquid funds available in Hong Kong and Singapore limit redemptions to set intervals and cap the amount that can be withdrawn, often following conventions such as “2% per month, 5% per quarter, and 20% per year.” These limits are designed to protect remaining investors, but they also mean that full redemptions are not guaranteed. When limits are reached, investors may be subject to pro‑rated withdrawals.

**Valuations **
Valuation methodologies and frequencies are inextricably linked to the low liquidity typical of underlying assets. Valuation approaches tend to be subject to broad, non-structure-specific regulatory thresholds, while underlying assets often follow their own valuation cycles in line with manager governance and controls. From our observations in Hong Kong and Singapore, asset valuations are typically monthly for private credit assets, monthly or quarterly for private equity, and quarterly or half-yearly for real estate. 

**Fees**
Fees are generally higher and more complex than those of traditional open‑ended funds, and investors should be mindful of this. In addition to management fees, semiliquid vehicles may charge incentive fees or carried interest subject to hurdles, high-water marks, and/or clawback provisions.

**Key Takeaways**
Semiliquid fund structures offer a pathway into private asset classes for sophisticated investors in Hong Kong and Singapore, but they demand careful consideration. Regardless of structure, underlying assets remain inherently illiquid, fees tend to be higher, and liquidity is conditional rather than assured. Investors must be prepared to hold these assets beyond the short term, with patience and a long‑term mindset.

To learn more about semiliquid fund structures across Asia‑Pacific and how approaches in Hong Kong and Singapore compare with other regional markets, please access our full report, [Demystifying Semiliquid Fund Structures: An Asia‑Pacific Perspective](https://www.morningstar.com/en-hk/business/insights/research/apac-semiliquid-fund-structures).


Demystifying Semiliquid Fund Structures in Hong Kong and Singapore

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# Create a visual map of your financial future

Are you saving money without a clear purpose? And putting off investing because you don’t know where to start?

•	**Give meaning** to your investments by connecting them to your life goals.

•	**Break down your journey** into clear, manageable steps.

•	**Make decisions** that align with what matters to you.

Ready to take the first step?

**[Define your goals](https://www.amundi.com.sg/retail/new-investing-start-here-step-step-guide)**
<br><br>
# Wondering which investments actually match your goals?

With countless investment options available, choosing the **right** ones can feel challenging. Investment decisions deserve careful thought.

We cut through the complexity and help you **match investments** to your goals.

Let's clear the path to your investment decisions.
<br><br>
# Understand the risk-return connection

![image1.jpg](/uploads/image1_fc61fa6d81.jpg)
<br><br>
# Factor timelines in your decision

Your investment horizon significantly influences which solutions make sense for you:

![long-terms-shorts-term.png](/uploads/long_terms_shorts_term_1449ede84d.png)

### Diversify your investments

![image2.jpg](/uploads/image2_f259f8c12e.jpg)
<br><br>
# Evaluate different options

There are many options for how you can best build your portfolio:

![different-funds.png](/uploads/different_funds_fd7e1701a3.png)


# From Knowledge to Action

Investment knowledge is your foundation, but action is what builds your future.

These key principles help you better understand your options and have productive conversations with your financial advisor. Today's choices build tomorrow's success.

<p></p><p></p><br><br>

##### Important and Legal Information
This document is issued by Amundi Singapore Limited (Company Registration No. 198900774E) who is regulated by the Monetary Authority of Singapore. 

This document is for information purposes only, is not a recommendation, financial analysis or an investment advice and does not constitute a solicitation, invitation or offer to purchase or sell any product. The information contained in this document is intended for general circulation without taking into account the specific investment objectives, financial situation or particular needs of any particular person. 

The information contained in this document is as at February 2025 except where otherwise stated. The information contained in this document has been obtained from sources believed to be reliable but has not been independently verified, although Amundi and its affiliated companies (collectively “Amundi”) believe it to be fair and not misleading. Opinions expressed in this document are subject to change without notice. Amundi does not accept liability whatsoever whether direct or indirect that may arise from the use of information contained in this document. Amundi and its associates, directors, connected parties and/or employees may from time to time have interests and/or underwriting commitments in the securities mentioned in this document.

**Past performance and any forecasts made are not necessarily indicative of the future results**. Any forecast, projection or target is indicative only and is not guaranteed in any way. All investments involve risks and the amount received from such investments may be less than the original invested amount. Amundi does not guarantee that all risks associated to the securities mentioned herein have been identified, nor does it provide advice as to whether you should enter into any transaction.

This document is solely for issue in permitted jurisdictions and to persons who may receive it without breaching applicable legal or regulatory requirements. The information contained in this document shall not, without prior written approval of Amundi Singapore Limited, be copied, reproduced, modified, or distributed, to any third person or entity in any country.
This document is not for distribution and does not constitute an offer to sell or the solicitation of any offer to buy any securities or services in the United States or in any of its territories or possessions subject to its jurisdiction to or for the benefit of any U.S. Person (as this term is defined in SEC Regulation S under the U.S. Securities Act of 1933). 

**This document has not been reviewed by the Monetary Authority of Singapore.**



How can Goal-Based Investing help you with retirement?

How To Build Wealth ft. Earn Your Leisure

![JIDXGG6EJJCXXKWZPHKYYEUN5Y.jpg](/uploads/JIDXGG_6_EJJCXXKWZPHKYYEUN_5_Y_8a5dc826a7.jpg)

Morningstar’s Manager Research analysts in Asia qualitatively cover a wide range of managed strategies. In addition, we continuously monitor the broader fund universe through discovery meetings. In this quarterly publication, we share our take on a selection of these strategies. For our first report in 2026, we highlight one alternatives fund, two equity funds, and two bond funds. 

Increased accessibility and potential diversification benefits from traditional asset classes have drawn investors to alternatives strategies, which encompass a wide range of assets and investment approaches. Our first alternatives strategy idea in this series, M&G (Lux) Episode Macro, follows an opportunistic macro-trading approach that aims to deliver annualized rolling five-year returns of 4% to 8% above SOFR while keeping volatility below double digits. The manager takes a discretionary and contrarian approach to exploit temporary behavioral episodes in markets, though his ability to navigate the strategy across different market environments remains largely untested.

Singapore equities have been seen as a refuge within Asia ex-Japan amid ongoing market volatility, given their defensive characteristics, and Singapore equity funds have registered positive flows over the past year. This coincides with the Monetary Authority of Singapore’s efforts to revitalize the local equity ecosystem via initiatives aimed at deepening liquidity and broadening participation. Through the Equity Market Development Program, the MAS is directing capital to asset managers deemed to have robust investment capabilities and a willingness to allocate meaningful exposure to Singapore-listed companies, including small and mid-caps.

Fullerton Fund Management and J.P. Morgan Asset Management were among the first managers appointed for the EQDP, subsequently launching new strategies under the program in October 2025 and January 2026, respectively. Fullerton Singapore Value-Up prioritizes growing domestic companies exhibiting strong shareholder return generation. It invests purely in Singapore-listed stocks and allocates around 30% of assets to SMID caps. JPMorgan Singapore & Asia Equity Income seeks a total income of 5% to 7% over the cycle, generated via a combination of 3% to 5% from investing in dividend-paying companies and around 2% from writing call options. The strategy taps experienced managers from across the firm’s deep pool of resources.

Within fixed income, Asian credit has remained relatively resilient despite tight spreads, supported by stable corporate fundamentals and limited bond supply. Compared with global fixed income, the asset class’lower duration profile, distinct geographic focus, and differing issuer composition also offer some diversification benefits.
A common theme across this quarter’s bond fund ideas is their long-tenured portfolio managers, who have weathered a wide range of market conditions. Nomura Asia Investment Grade Bond is a high-quality offering that aims to outperform the JPM Asia Credit Investment Grade Index through rigorous relative-value analysis within the investment-grade universe. The team has successfully identified mispriced opportunities, helping the fund keep pace with rivals despite its conservative mandate. For investors with a higher risk appetite, the high-yield-focused BEA Union Investment Asian Bond and Currencyrelies on disciplined bottom-up credit selection with a strong track record navigating downturns such as the China property crisis.

For the full report, please visit: https://www.morningstar.com/en-hk/business/insights/research/apac-investment-opportunities


Ideas on Our Radar: Q1 2026

As high-profile companies like OpenAI or SpaceX stay private for longer and show how fast young private companies can disrupt entire industries, it's only natural for investors to fear that they are missing an opportunity and reflect on how they can benefit from increased access to private markets. 

Interest in semiliquid funds has grown against this backdrop. They lack a fixed end date and offer periodic windows of liquidity, bridging the gap between daily liquid funds and exchange-traded funds, and classic private-asset structures that feature lockups, ramp-up periods, and wind-down phases.

The starting point is still about understanding our investment objectives. For investors seeking higher long-term returns, semiliquid strategies can provide access to private equity or venture capital-style opportunities with potentially higher returns compared with public markets. Similarly, enhanced income needs can be met by semiliquid strategies in private credit, infrastructure debt, or real estate income funds. Other objectives may include capital preservation and inflation protection. 

![Screenshot 2026-02-24 135835.png](/uploads/Screenshot_2026_02_24_135835_7d8759f088.png)

Additional factors should be carefully considered though. 

While semiliquid fund structures provide liquidity windows to get in or out of the fund, liquidity provisions are limited by design, and gating redemptions is a possibility in certain situations. Having a long investment horizon and sizing the positions carefully are therefore essential. 

There is no such thing as low-cost, passive exposure to private markets. Private assets are notoriously expensive to access, which hinders investors from reaping the full benefits that private assets can deliver. At the same time, the wide dispersion of returns across strategies makes strong manager selection a requirement rather than an option.

Further, infrequent pricing hides true volatility and correlation, making privates look safer and more diversifying than they really are. As a result, traditional mean-variance models often push investors toward very high private asset allocations, but these outcomes often rest on shaky inputs.
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To learn more about how to successfully construct a portfolio that spans both public and private markets, check out our full report [The Role of Semiliquid Funds in Portfolios](https://www.morningstar.com/business/insights/research/semiliquid-funds-in-portfolios).



The Role of Semiliquid Funds in Portfolios 

With gold prices soaring to record highs, investors are rushing to gain exposure, many via funds. But in the rush, some pick a gold fund thinking it gives them exposure to the metal, only to end up with a fund full of gold-mining companies, whose returns are influenced by myriad factors beyond just the gold price. 

As shown in Exhibit 1, gold and gold-mining funds are making a strong comeback after years of muted interest from investors. Amid macroeconomic uncertainty and geopolitical concerns, as well as increased demand from central banks and investors alike, the gold price soared to USD 3,825 as of Sept. 30, 2025, a sharp increase of 45% compared with the year before, and it reached a record high closing price of USD 4,294 on Oct. 20, 2025. These funds attracted close USD 50 billion in 2025 as of Sept. 30, marking the strongest year in the past decade.

![Screenshot 2026-01-29 151158.png](/uploads/Screenshot_2026_01_29_151158_8969dc6c1e.png)

**Understanding the Difference**

At first glance, gold funds and gold-mining funds may appear similar. Both are linked to the gold market and may be marketed under the same umbrella. However, their underlying assets—and the risks they carry—are fundamentally different.

Gold funds typically hold physical gold or track its spot price through futures or other instruments. These funds are designed to mirror the performance of gold itself. Gold’s price has seen a sharp rally in recent years, driven by macroeconomic uncertainty, central bank activity, and geopolitical tensions. That said, it is susceptible to significant drawdowns, too, such as in 2013, when expectations of the Federal Reserve tapering its stimulus program amid an improving economic outlook led to a decline in gold prices.

Gold-mining funds, on the other hand, invest in companies that are engaged in the exploration, mining, or processing of precious metals, primarily gold. These are equity investments, where their performance is influenced not only by the price of gold but also by company and sector-specific factors like earnings, cost structures, management decisions, and macroeconomic or geopolitical factors. They tend to be more volatile than gold prices, exhibiting higher correlation with the broader global equity market. Unlike gold, which is a nonyielding asset, however, mining companies generate cash flows and may pay dividends, potentially enhancing investor returns.

To illustrate the differences, consider two of the largest gold and gold-mining exchange-traded funds: SPDR Gold Shares GLD, which reflects the performance of the price of gold bullion, and VanEck Gold Miners ETF GDX, which holds a basket of gold-mining stocks. 

SPDR Gold Shares has posted similar maximum and minimum quarterly returns as the global equity market of around plus/minus 20% in the past two decades, but the returns were far from synchronized, as shown in Exhibit 2. VanEck Gold Miners ETF, meanwhile, has demonstrated amplified swings, both upward and downward, reflecting not only gold price fluctuations, but also the variations in operational performance, financial leverage, and sentiment surrounding the mining companies it holds.

![Screenshot 2026-01-29 151307.png](/uploads/Screenshot_2026_01_29_151307_fcb1533737.png)

**How to Spot the Difference**

One of the most common pitfalls is assuming that any fund with “gold” in its name provides direct exposure to the metal. In reality, many such funds hold stocks, investing in mining companies rather than the commodity itself. For example, BGF World Gold invests primarily in companies engaged in gold mining and does not hold physical gold.

To learn more about the difference between gold and gold-mining funds and how to tell them apart, please access our full report, [Not All That Glitters is Gold](https://www.morningstar.com/en-hk/business/insights/research/gold-investment-guide)




Not All That Glitters Is Gold - Differentiating between gold and gold-mining funds

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Author: Kate Lin, CAIA

Last week, we tested a strategy with two [Chinese equity indices](https://sg.morningstar.com/sg/news/211963/does-the-rhyming-%e2%80%9csell-in-may-go-away%e2%80%9d-work.aspx), and talked about how it timing the market makes you lose out on gains over the long-term. The modeling of index returns concluded that botching a market-timing decision does sacrifice a period of (strong) returns. It proved our point – time in the market is better than timing the market.

Tom Lauricella, Editorial Direct for Professional Audience at Morningstar, explains that [ineffective market-timing](https://www.morningstar.com/articles/972119/3-charts-that-show-why-investors-should-stay-the-course-throughout-market-turmoil) efforts can result in a significant opportunity cost and show the effects of missing the one best month on an annual return. “Although successful market-timing may improve portfolio performance, it is very difficult to time the market consistently,” says Lauricella, adding that the long-term gains from US stocks have been demonstrated to offset short-term losses.

Even worse, poor market timing means you give up the chance to gain more from the compounding of reinvested gains, therefore the net effect in an investment strategy is negative when compared to a portfolio that stays the course.

**What is Compounding?**

In a short answer, staying the course is the key to allow the compounding to work out. But what exactly drives compounding. Let’s start with what’s known as the ‘compound interest’ formula:

**End value = Initial value of capital*(1+Rate of change)Time**

1.  Initial Capital determines how much in absolute terms you can gain at a certain rate for a period of time.
2.  Rate of Change or the rate of investment return defines at what pace the initial and reinvested capital is to compound.
3.  Time Horizon defines for how many time periods your assets compound itself.

Put simply, compounding can be explained as the money (or returns) your portfolio earns each year, and then both your initial capital and your returns of previous years earn returns, leading to a point where you have a much larger capital pool. That means, the larger each of the equation’s components (on the right) is, the bigger your total capital would snowball into overtime.

It’s clearer in a side-by-side line graph that plots four scenarios. First, we let the base case (purple line) be a portfolio with a starting capital of $10,000. The portfolio invests in assets at the end of Year 0 that could generate an average of 10% each year and remains the same for the next 35 years.

For each of the remaining three lines, only one variable is adjusted in illustrating the outcome upon a shortened time horizon, a lower rate of return and a smaller capital to start in the equation.

![Elements in compounding.jfif](/uploads/Elements_in_compounding_c94ad1f49c.jfif)


With all else equal, beginning with capital in half means the portfolio will grow at the same rate but arriving at the exact 50% in the end value of the base case.

By contrast, when axing the investment horizon and the rate of return by half, what you afford is a return far less than just half of the base case. Shortening the investment horizon gives up the sessions that the portfolio can compound, while a smaller investment return simply flattens the curve by a large extent. Both result in merely 20% in end value as compared to the base case.

With a view to long-term performance, we go back to the base case of our data simulation and assume that in each calendar an investor adds 10% and 20%, in this case $1,000 and $2,000, to their portfolio (shown as dotted lines).

![Enlarging the compounding effect.jfif](/uploads/Enlarging_the_compounding_effect_64ba5c7108.jfif)


We find that upsizing the total portfolio value on a regular basis takes advantage of the compounding, enabling the portfolios to notch high absolute returns. This is for those who don’t have a large pot of starting investment capital, say at the early stage of their careers. Instead of sitting on cash to save up a sizable amount in some time, it is worth considering starting small to let the compound work. Expanding the capital base can come later by building up a disciplined top-up mechanism to your portfolio.

Indeed, the stock market is seen as a risky investment if you look at it for the short term. Data have shown proof that long-term returns have outsized short-term fluctuations and have triumphed over the risk of missing the one best month on an annual return by betting in and out. In practice, trying to call the trough and the peak of the market prices is distinctly tricky. The strategy involves a great deal of knowledge and luck. For individual investors who lack experience and time in technical research analysis, market timing would then be primarily driven by biases like loss aversion or herd mentality, which may cause some investors to end up buying high and selling low. Staying the course will bear fruit if you endure the time with discipline.

 

 

*©2021 Morningstar. All rights reserved. The information, data, analyses and opinions presented herein do not constitute investment advice; are provided as of the date written, solely for informational purposes; and subject to change at any time without notice. This content is not an offer to buy or sell any particular security and is not warranted to be correct, complete or accurate. Past performance is not a guarantee of future results. The Morningstar name and logo are registered marks of Morningstar, Inc. This article includes proprietary materials of Morningstar; reproduction, transcription or other use, by any means, in whole or in part, without prior, written consent of Morningstar is prohibited. This article is intended for general circulation, and does not take into account the specific investment objectives, financial situation or particular needs of any particular person. Investors should consult a financial adviser regarding the suitability of any investment product, taking into account their specific investment objectives, financial situation or particular needs, before making any investment decisions. Morningstar Investment Management Asia Limited is licensed and regulated by the Hong Kong Securities and Futures Commission to provide investment research and investment advisory services to professional investors only. Morningstar Investment Adviser Singapore Pte. Limited is licensed by the Monetary Authority of Singapore to provide financial advisory services in Singapore. Either Morningstar Investment Management Asia Limited or Morningstar Investment Adviser Singapore Pte. Limited will be the entity responsible for the creation and distribution of the research services described in this article.*

How Your Money Works for You

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Author: Valerio Baselli

Looking at the market today, it's easy to forget where we were at around 15 months ago. Many of the market declines of the past decade or so, including the stock market crash of 2008, are fast becoming faded memories for most of us. But it is the investors who endured these difficult times came out in perhaps the best shape, and as is often the case, those who had the nerve to stay invested were richly rewarded.

And yet, the decision about whether to change your investment strategy or sell a fund is usually not clear-cut, even in hindsight. After the dust has settled on a decision and the investment has performed well or poorly, the “right” answer is wholly dependent on the individual. Selling criteria are not a one-size-fits-all list that fit every investor, but there are some situations when selling is particularly ill-advised. Christine Benz, director of personal finance at Morningstar, picks these three key examples.

**Poor Short-Term Performance**
 
It’s almost never a good idea to sell a fund based on weak performance alone, especially over the short-term. You might have been tempted to sell in last year's market sell-off for example, but we now know the Covid crash was the shortest in history. Instead, if a fund is lagging its peers or an index, your first move should be to investigate why that is. It could be that the manager is simply sticking with an investment strategy that happens to be out of favour, as has been the case with many value-leaning funds in recent years. But weak performance may also be a sign that something more serious is afoot - Morningstar's own research has found that many active funds fail to beat the market over the long-term.

Researching an investment’s fundamentals can be time-consuming, which is why you don't want to get too caught up in investigating short-term bouts of underperformance. Most funds, especially those that are using truly active strategies, will trail their peers at times, often for very good reasons and sometimes for a few years or more (that could be the case with some perfectly solid, defensively positioned funds during a market rally, for example).

Instead, save your energy for checking up on funds when they've underperformed over longer stretches of time or in a period when you would have expected them to perform well. If, for example, you selected a fund because of its low-risk tendencies, but it lost far more than its peers in 2020, that's a legitimate reason to ask whether something about its strategy changed or its risk controls weren’t what you thought they were. And even if the fund isn’t bad, it may not be a good fit in your portfolio.

**Inconsistent Performance**

On a similar vein, investors often get themselves worked up when a fund’s relative returns are inconsistent on a year-to-year basis. Sure, it can be comforting to see a fund land in its category's top half like clockwork—and a small handful of funds has actually managed to generate return rankings that have been remarkably consistent from year to year.

But holding all of your funds to that standard would cause you to kick out some fine offerings that, while not consistent performers on a calendar-year basis, are consistent where it counts: they employ their strategies with discipline and don't waver, even if the market isn't rewarding them in the near term.

It's also important to remember that a calendar year is a fairly short and arbitrary time period, and a fund that has looked erratic over January-December time periods may appear perfectly consistent when measured over a different 12-month time frame—say, from April to March of each year. Investors shouldn't get too hung up on year-to-year performance consistency when deciding what to hold in their portfolios. Looking at annualised returns can be a better way to judge long-term performance, as these smooth out good and bad periods to indicate what average return an investor has received each year. 

**Macroeconomic News**

Macroeconomic news - whether it's the direction of interest rates, rising inflation or GDP growth in China and India - often appears right alongside news about the market's trajectory. And it's true that what's in the headlines has the potential to move the markets up or down on a daily basis, or even over longer time frames. The trouble is that by the time a certain news item makes its way into the headlines, other market participants have already digested it and priced it in.

If you decide to sell your fund based on that news, you're likely to be too late. Instead, a better tack for investors, at least as it relates to their portfolios, is to keep their heads down and focus on factors that they can control: their savings and spending rates, the quality of their investment holdings, and the total costs they pay for those investments. There is much virtue in tuning out the noise when it comes to managing your portfolio.





*©2021 Morningstar. All rights reserved. The information, data, analyses and opinions presented herein do not constitute investment advice; are provided as of the date written, solely for informational purposes; and subject to change at any time without notice. This content is not an offer to buy or sell any particular security and is not warranted to be correct, complete or accurate. Past performance is not a guarantee of future results. The Morningstar name and logo are registered marks of Morningstar, Inc. This article includes proprietary materials of Morningstar; reproduction, transcription or other use, by any means, in whole or in part, without prior, written consent of Morningstar is prohibited. This article is intended for general circulation, and does not take into account the specific investment objectives, financial situation or particular needs of any particular person. Investors should consult a financial adviser regarding the suitability of any investment product, taking into account their specific investment objectives, financial situation or particular needs, before making any investment decisions. Morningstar Investment Management Asia Limited is licensed and regulated by the Hong Kong Securities and Futures Commission to provide investment research and investment advisory services to professional investors only. Morningstar Investment Adviser Singapore Pte. Limited is licensed by the Monetary Authority of Singapore to provide financial advisory services in Singapore. Either Morningstar Investment Management Asia Limited or Morningstar Investment Adviser Singapore Pte. Limited will be the entity responsible for the creation and distribution of the research services described in this article.*

3 Bad Reasons to Sell a Fund

Last year was a roller coaster. While structural drivers such as artificial intelligence proliferation and corporate governance reforms buoyed Asian markets in 2025, fast-evolving trade negotiations, ongoing geopolitical tensions, and concerns over slowing economic growth introduced volatility and widened performance dispersions among major Asian markets. As we enter 2026, we draw on Morningstar's extensive on-the-ground research and frequent interactions with portfolio managers across Asia to explore the key themes shaping their strategies. 

Equity
Asian equities were propelled by technology companies in 2025, fueled by the ongoing AI boom, a trend that mirrored the rally in the US market. The Morningstar Asia ex-Japan Target Market Exposure Index returned around 32% in US-dollar terms, extending its gains from just over 10% in 2024. 

![Screenshot 2026-01-29 150758.png](/uploads/Screenshot_2026_01_29_150758_fae12d1380.png)

China equities have reignited market interest following technological transformations and policy support. That said, a slowing economy, overcapacity, and geopolitical tensions remain. Against this backdrop, fund managers are focusing on selective bottom-up opportunities with sustainable competitive advantages. Louisa Lo, manager at Schroder ISF Emerging Asia, steered away from overly crowded areas such as AI-related hardware companies and instead preferred more reasonably valued internet companies poised to benefit from AI advancements, such as Alibaba.

Following a couple of years of strong performance, Indian equities suffered a steep correction in early 2025, and India was the weakest-performing major Asian equity market despite ending the year in positive territory. On the bright side, this also brought valuations to a more reasonable level for select Indian companies. For instance, investors at Fidelity believe that India remains one of the most attractive long-term growth stories in the region, supported by robust economic growth and a benign inflation backdrop, which creates room for further interest rate cuts.

Meanwhile, the South Korean government rolled out a corporate value-up program in 2024, which has influenced how portfolio managers position themselves in the market. For example, investors at FSSA note early signs of meaningful change in the Korean corporate governance landscape, though they believe reforms will likely take time. Martin Lau of FSSA Asian Equity Plus added to LG Corporation over the course of 2025, which he believes has been among the most progressive in corporate governance.

In ASEAN markets, Pauline Ng, lead manager of JPM ASEAN, remained constructive on the supply chain diversification opportunities on offer in the region, while other managers favored Singapore as a source of defensiveness for their portfolios.

Fixed Income
In 2025, despite growth and inflation-related uncertainties stemming from the impact of trade tariffs, US Treasuries delivered solid returns, supported by a series of Federal Reserve rate cuts. The year also proved favorable for riskier credit assets, as spreads compressed across the board, with emerging-market debt among the top-performing segments.

There is a broad consensus among managers that Asian credit fundamentals are expected to remain resilient in 2026, with default expectations staying low. However, a common concern is the relatively tight valuations, which leave limited room for meaningful spread compression. 

From a country positioning perspective, India remains a consensus favorite among Asian credit managers. The country’s macroeconomic strength and robust growth driven by domestic demand are frequently highlighted as key positives. Building on last year’s trend, many managers also continue to favor offerings from the broader Asia-Pacific market, notably Japan and Australia, supported by high credit quality and reasonably attractive yields.

The troubles at prominent real estate developer New World Development over the past year have led managers to adopt a more cautious stance toward the Hong Kong property sector. Meanwhile, China remains out of favor for most investors. Within the higher-quality investment-grade segment, managers note that Chinese credits are trading at very tight valuations, reducing their attractiveness. On the other hand, within the high-yield market, challenges within the country's property sector remain persistent, as evident from the recent developments at real estate developer Vanke, keeping managers cautious.

To learn more about what is top of mind for Asian portfolio managers and how they are positioning their portfolios to navigate the year ahead, please access our full report, [Starting 2026 on the Right Foot](https://www.morningstar.com/en-hk/business/insights/research/equity-and-fixed-income-manager-trends).


Starting 2026 on the Right Foot

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![Imas-Website-Slider-Scam.png](/uploads/Imas_Website_Slider_Scam_6d848ac532.png)


## Key Takeaways
- All investments carry risks. Before investing, always ask yourself, “Sure or not?”
- Check that the [entity](https://eservices.mas.gov.sg/fid) or [individuals](https://eservices.mas.gov.sg/rr) regulated by the Monetary Authority of Singapore (MAS)
- Check for red flags. Be wary of opportunities that offer high returns at little or no risk. Most of us would have read about news reports of people who were scammed. People continue to fall victim as scammers constantly come up with new, convincing ways to steal what is often very large amounts.

## Common Investment Scams

Have you encountered any of these situations?

Self-initiated investment scam variant: While searching for investment opportunities online, you find one that promises to be lucrative. It could even be an ad you chance upon on social media platforms touting profitable "investment opportunities".

<iframe width="560" height="315" src="https://www.youtube.com/embed/UgFF_nuB9N0?si=mnrBohDNS3GX7N8-" title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen></iframe>

Chatgroup addition investment scam variant: Out of nowhere, you are added to a group chat where people are sharing their windfall from a not-to-be-missed investment.

<iframe width="560" height="315" src="https://www.youtube.com/embed/ilTdLNrvl34?si=rVEnytOivYFaA8pJ" title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen></iframe>

Befriending investment scam variant: Your new online friend who shares your interests starts telling you about an exclusive investment opportunity.

<iframe width="560" height="315" src="https://www.youtube.com/embed/nNOajUqDPi0?si=J_wf8lAyq2hG0eo-" title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen></iframe>

Sounds familiar?

In many instances, victims thought they would never get scammed – sometimes they use the profits they receive initially to refute disbelieving loved ones. But criminals have become extremely skilled at convincing people that get-rich-quick scheme is real and high returns are within easy reach. Always remember to ask, “Sure or not?” and conduct checks to safeguard your hard-earned money! Here's what you should check.

### Check That The Entity Is Regulated

Some investment scams may even claim to be regulated by the relevant authorities to mislead you.

Confirm such claims by checking the resources on the Monetary Authority of Singapore (MAS) website.

- [Financial Institutions Directory](https://eservices.mas.gov.sg/fid) - a list of financial institutions regulated by MAS and the regulated activities they are authorised to provide
- [Financial Institution Representatives Register](https://eservices.mas.gov.sg/rr) - a list of individuals who conduct activities regulated by MAS
- [Investor Alert List](https://www.mas.gov.sg/investor-alert-list) - a non-exhaustive list of persons unregulated by MAS who may have been wrongly misperceived as being licensed or authorised by MAS

Remember, [dealing with an unregulated entity](https://www.moneysense.gov.sg/dealing-with-unregulated-persons/) means giving up the safeguards offered under the laws administered by MAS.

### Check On The Company's Background

Do not be too quick to believe everything you are told. Verify information provided by the entity about themselves or the investment opportunity, such as the background of representatives and the entity's track record.

It is also important to ask the entity as many questions as you need to fully understand the investment opportunity. If it is unable to answer or avoids answering any of your questions, be wary.

If you suspect that you are a victim of scam, inform your bank and file a police report immediately.

Tell your family and friends about investment scams so that they do not fall prey to them.

### Check For Red Flags

Scammers use sophisticated tactics to get you to part with your money. There are red flags you can watch out for to steer clear of investment scams.

#### 1) High Returns At Low Or No Risk

Be wary when you encounter an investment opportunity that claims to guarantee or protect your capital while promising high returns. The greater the promised investment returns, the higher the risks should be. Many investment scams use lucrative promises to lure investors in

#### 2) Pressure Tactics

- "Limited time only! Invest before it sells out!"
- "Special rates for first 50 investors. Don't miss out on this golden opportunity!"
- "More than 2,000 people have invested - what are you waiting for?"
- "Invest today and get extra 10% credit with many other benefits."

Limited offers, timed gifts or rebates, are common tactics in investment scams to rush you into committing your money.

Make sure you fully understand what you are buying into instead of focusing on the carrots dangled.

#### 3) Offer Of Commissions

Legitimate investment schemes generally do not offer commissions to investors for referrals.
Investment scams use such incentives to encourage existing customers to bring in their friends and associates to quickly enlarge their investor base.

#### 4) Fictitious Track Records

Investment scams may claim to have many years of experience, multiple accolades or simply large investment profits to gain trust.

Some use testimonials from "satisfied customers" to shore up their credibility.

You should approach claims with healthy skepticism. Where possible, verify the claims with an independent third party.

Remember, if an investment sounds too good to be true, it probably is.

### Safeguard Yourself Against Scams

To ACT and safeguard yourself against scams:

**ADD:**

- Privacy settings to your messaging app to avoid being added into unknown chatgroups
- Security features such as 2 or multi-FA for banking apps, transaction limits on payment accounts (bank, PayNow, PayLah)
- Money Lock to your bank accounts to further secure a portion of your savings
<p></p>

**CHECK:**

- Resources on the MAS website (i.e. Financial Institutions Directory, Register of Representatives, and Investor Alert List) on whether the company offering the investment opportunity is regulated by MAS
- With someone you trust about the offer
- Call the ScamShield helpline (1799) to check if you are unsure
- Call the official hotline of the company to check if this investment product is legitimate

**TELL:**

- Warn friends and family about this scam encounter
- Report aFor information on other scams and how to safeguard yourself against them, you may visit scamshield.gov.sg.nd block suspected scam accounts/ chat groups
- Call your bank immediately and make a police report if you think you have fallen victim

For information on other scams and how to safeguard yourself against them, you may visit [scamshield.gov.sg](https://www.scamshield.gov.sg/).


Stop! Do not fall victim to the scammers!

Saving and Investing are two terms that are often used interchangeably, but they are actually different tactics that go hand-in-hand to help you reach your financial goals. Savings typically are intended for a rainy day or short-term goals, while investing involve an asset purchase that you believe may generate a return over time. Watch the video to learn more.

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