‘Encouraging momentum’: Fund managers on Singapore’s S$6.5 billion equity push amid volatile markets

[SINGAPORE] Fund managers under the Monetary Authority of Singapore’s (MAS) S$6.5 billion Equity Market Development Programme (EQDP) have seen an encouraging response from investors despite heightened global uncertainty and market volatility.

The programme was introduced last November. Assets under management (AUM) and investor interest continue to grow, with several managers saying their funds are already substantially or fully invested.

“We would characterise our EQDP capital as fully invested,” said Michelle Sim, portfolio manager of the Fullerton Singapore Value-Up EQDP fund at Fullerton Fund Management.

At JP Morgan Asset Management, Asean equity portfolio manager Ong Changqi said investor response to its EQDP-linked strategy has been positive, with AUM recently exceeding S$800 million.

“The key objective of the JPMorgan Singapore & Asia Equity Income Fund is to deliver attractive yield and competitive returns, and we have achieved that thus far,” said Ong, who is also portfolio manager of the fund.

Chan Hock Fai, head of equities for Singapore at Manulife Investment Management, indicated that it is still too early to assess the performance of the Manulife Singapore Opportunities Income Strategy, given its recent inception in March 2026 and prevailing market volatility linked to the Iran war.

“That said, the fund has performed credibly in this short period, returning positive returns and outperforming its benchmarks despite the market volatility,” he said.

Manulife Investment Management declined to disclose capital allocations and its associated deployment figures, citing client confidentiality.

Over at Avanda Investment Management, there has been a strong start for its Singapore Discovery Fund. Its investment team said it has been encouraged by the early performance of this fund since launch and noted continued traction in fundraising.

The fund is available only to institutional and accredited investors and does not publish a publicly available fact sheet. Access to fund documentation is restricted to eligible investors.

The investment team said it has seen strong interest from sovereign, institutional and family-office investors since inception.

“If anything, the recent bout of global market volatility has reinforced the case for what our Singapore strategy is designed to do – to provide a unique and attractive investment opportunity that is less exposed to global market volatility.”

EQDP outcomes

The developments come as MAS is expected to appoint a third batch of asset managers under EQDP in the coming weeks, in line with its target to do so by end-June.

Nine fund managers have been appointed under the programme across two batches announced in July and November last year.

They are Avanda, Fullerton, JP Morgan, Amova Asset Management, AR Capital, BlackRock, Eastspring Investments, Lion Global Investors and Manulife Investment Management.

Seven of the managers have launched their funds, while Eastspring and AR Capital are expected to officially launch theirs by end-June. Eastspring has yet to announce details of its fund.

A MAS spokesperson told The Business Times that EQDP forms part of a broader set of measures aimed at strengthening Singapore’s equities market. Under the programme’s first two phases, S$3.95 billion has been allocated across the nine appointed fund managers.

“Arising from these appointments, some fund managers have launched their strategies to both retail and institutional investors,” the spokesperson said.

The spokesperson added that MAS will assess the effectiveness of its broader market measures, including EQDP, across three key areas: strengthening fund management and research capabilities in domestic equities; improving liquidity and broadening investor participation, particularly in small and mid-cap stocks; and enhancing overall market competitiveness, including IPO activity.

“We recognise that these objectives will take time to achieve and will assess the programme outcomes progressively,” the spokesperson added.

Against this backdrop, fund managers highlighted early performance trends across their respective strategies.

For instance, Fullerton’s Sim described the Fullerton Singapore Value-Up fund’s performance so far as “encouraging”, particularly given its “relatively short track record and high-conviction approach”.

The fund, which has AUM of S$629.9 million, has outperformed its benchmark, the FTSE Straits Times All Share Total Return Index, which tracks companies listed on the Singapore Exchange (SGX) that fall within the top 98 per cent of the market by capitalisation. According to Fullerton, the fund is “tracking constructively” towards its objective of generating returns above this index.

The FTSE ST All-Share Index gained 2.4 per cent in April, led by the financials, real estate and information technology sectors. Over the same period, the fund returned 3.3 per cent, outperforming the index by one percentage point.

The benchmark has delivered a return of 12.8 per cent over the six months since October 2025. Over the same period, the fund generated a bid-to-bid return of 14.9 per cent. Since its inception on Oct 2, 2025, the fund has returned 15 per cent on a bid-to-bid basis.

Returns are calculated on a single-pricing basis in Singapore dollars, with net dividends and distributions reinvested.

JP Morgan’s Ong said that for clients that opted for the accumulating share classes, net asset value is up about 8 per cent since launch despite volatile markets.

For clients that opted for the monthly distribution share class, he added, dividends received are equivalent to an annualised yield of close to 7 per cent.

“The option overlay strategy is delivering as expected, providing an innovative source of income to our investors and smoothening the equity experience during periods of market corrections,” added Ong.

Meanwhile, Avanda said its strategy has a return objective set over a three to five-year horizon for “good reason”.

“It reflects our conviction that compounding high-quality investments through market cycles, rather than chasing short-term performance, is where the real value is created,” the company said.

What’s the visible impact?

SGX is seeing encouraging improvements in market liquidity and participation even as EQDP remains in the early stages of capital deployment, said its head of securities market and depository, Serene Cai.

“Feedback has been positive, with strong support for the programme’s long‑term focus on market fundamentals,” she added, noting that regional interest is also growing with increasing demand for corporate access.

Importantly, Cai said EQDP is designed to deliver structural improvements in liquidity. This includes expanding the investable universe through enhanced research coverage and stronger investor engagement, supporting more consistent price discovery over time.

She noted that, under MAS’ Grant for Equity Market Singapore programme, more than 100 initiation reports have been completed this year, significantly increasing publicly available research.

According to the latest figures from SGX, liquidity has broadened meaningfully across the market. The number of stocks with securities daily average value (SDAV) of at least S$1 million has increased to more than 110 in the year to date in 2026, up from 73 in 2023. Market-wide SDAV has also risen 38 per cent year on year to S$2.1 billion as at April 2026 year-to-date.

Specifically, average daily turnover in small and mid-cap (SMID) stocks, excluding STI constituents and real estate investment trusts, rose 179 per cent year on year from January to April. This represented the highest share of cash equities turnover since July 2021.

Fund managers said the improving liquidity backdrop is beginning to support a reassessment of Singapore equities.

“We see a strong catalyst for rerating in the Singapore market, especially in the mid-cap segment of the market,” said Manulife’s Chan, adding that the manager intends to allocate a meaningful portion of its portfolio to capture potential capital gains in the segment.

Eastspring similarly noted that valuation multiples across the SMID segment have expanded, particularly among technology and industrial companies. “Returns on equity have also modestly improved, indicating better underlying capital efficiency,” said a spokesperson.

“Change will take time”

The improving sentiment is also leading to a healthy IPO pipeline, with several EQDP fund managers expected to participate as cornerstone investors in upcoming listings.

For fund managers, such participation is not just about gaining exposure to new listings, but also signalling longer-term confidence in Singapore’s market.

“Cornerstone participation is a meaningful commitment, and we approach it with the same rigour we apply to any investment decision,” said Avanda.

The firm added that beyond business fundamentals, it also evaluates whether companies are genuinely committed to building long-term relationships with Singapore’s investor community.

Fund managers also said investor interest in Singapore equities appears to be strengthening.

Fullerton’s Sim said: “In that sense, the EQDP is doing more than adding capital – it is helping to reframe Singapore equities as a more investable and increasingly relevant opportunity set for both domestic and regional investors.”