Asset manager Amundi and OCBC Bank have launched the Amundi-OCBC Momentum Fund.
The first of its kind in Singapore, it harnesses a dollar cost averaging feature.
In addition, it marks a big partnership between Amundi and OCBC Bank in developing a co-branded solution to address investor needs.
Dollar cost averaging for Amundi & OCBC
The Momentum Fund uses the well known strategy of investing in regular bite-sized placements, similar to a regular savings plan.
Furthermore, it lets the portfolio manager initiate dollar cost averaging for the investor. Investors are also paid a regular dividend and will be positioned to enjoy further capital appreciation even as markets move higher.
In a statement, the firms said this provides investors peace of mind through three factors:
- Stepping out of cash;
- Peace-of-mind investing: disciplined and systematic approach in asset allocation, and
- Potentially earning quarterly dividend of up to 3% per annum.
The OCBC Financial Impact Survey for Covid-19, conducted in May 2020, stated the 54% of Singaporeans aged 21 to 65 are worried about how the pandemic would affect their portfolios.
However, younger Singaporeans are optimistic. 30% of those in their 20s and 28% of those in their 30s plan to increase their investments.
Tan Siew Lee, head of wealth management Singapore, OCBC Bank, said: “Financial markets have been volatile in recent months, largely because of Covid-19 and other geopolitical factors, and this looks set to continue in the coming months and even into 2021. With markets so volatile, some investors may run for cover.
“However, our view is that investors should remain calm because global authorities are better prepared today to deal with Covid-19 than they were when the pandemic first hit. Investors should stay invested in the market and not wait for blue skies. They should manage risk by investing carefully and staying diversified across asset classes and by taking on risk gradually over time through regular investments – in other words – dollar cost averaging. This can benefit investors by potentially lowering the average cost per unit of an investment, especially during times of volatility.”
Eric Bramoullé, Amundi’s chief executive officer of South Asia said: “It is important for investors to look beyond current volatility and stay on track with their long-term investment goals. Investing is a long-term plan and success should be measured according to that plan and not the day-to-day movement of the market. The new Amundi-OCBC Momentum Fund is not only good for existing investors looking to diversify their portfolios, but is also structured to help side-lined investors get into the momentum of investing again.”