Dimensional Launches Three Low-Cost, Systematic Active Funds included under the Central Provident Fund Investment Scheme (CPFIS)
Dimensional Fund Advisors Pte. Ltd. (Dimensional), a pioneer of factor investing and Morningstar’s asset manager of the year in Singapore, has launched three funds under the CPFIS.
The three funds provide CPF Ordinary Account holders with access to Dimensional’s evidence-based approach, targeting market-beating returns. The funds draw on Dimensional’s 40-plus years of experience in factor investing and offer exposure to developed and emerging equity markets and global bonds.
Dimensional Investing
A culture of academic inquiry is Dimensional’s bedrock. The firm is driven by an evidence-based approach, Nobel Prize–winning insights, and decades of expertise pursuing higher returns. Since Dimensional’s founding in 1981, five Nobel laureates have had close ties with Dimensional or the US Dimensional Funds: Merton Miller, Robert Merton, Myron Scholes, Eugene Fama and Douglas Diamond.
Dimensional believes market prices incorporate new information and market participants’ expectations in real time. Its strategies use the information contained in prices to seek better returns, manage risk and control costs. Trusting markets means the firm takes a less subjective, more systematic approach to investing—which can be implemented consistently around the world and across asset classes.
Dimensional’s strategies are low cost, low turnover, own hundreds or thousands of securities, and generally use a flexible process that continuously and systematically targets higher expected returns.
A New Suite of Funds
The new funds included under the CPFIS offer a combination of broad diversification with flexible implementation that aims to improve upon market returns. They are also expected to be among the lowest cost funds included under the CPFIS.1
The new funds offer a global, balanced portfolio solution able to meet various long-term investment objectives and are similar to long-running strategies available to Dimensional’s clients around the world.
Joel Kim, Chief Executive Officer, Asia ex-Japan, and Head of International Fixed Income, said: “The CPF is a great asset to the people of Singapore, and the addition of Dimensional’s funds increases its value. We’ve been working with investors in Singapore for more than 10 years, and we are proud that so many more people will now have access to Dimensional Investing.”
Joel Teasdel, Head of Wealth Management Group, Asia ex-Japan, said: “Singapore’s private wealth management industry is developing fast and promises to transform the financial security of many families. Adding Dimensional’s funds to the CPF Investment Scheme is a game changer for people who want flexible and cost-effective access to world equity and bond markets.”
About Dimensional Fund Advisors
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Dimensional is a leading global investment firm that has been translating academic research into practical investment solutions since 1981. Guided by a strong belief in markets, we help investors pursue higher expected returns through a systematic investment process that integrates research insights with advanced portfolio design, management and trading while balancing tradeoffs that can impact returns. Dimensional is headquartered in Austin, Texas, and has 15 global offices across North America, Europe and Asia. As of 31 March 2024, Dimensional manages $719 billion USD for investors worldwide. For more information, please visit dimensional.com. Dimensional has offered its highly diversified, low-cost systematic funds in Singapore since 2012. Dimensional Fund Advisors Pte. Ltd. was named Best Asset Manager in Singapore in the 2024 Singapore Morningstar Awards for Investing Excellence. The launch of Dimensional’s funds within the CPFIS has been made possible with the support of two important wealth management firms in Singapore, Providend and Endowus. Dimensional’s funds will be available through these private wealth planners, with broader distribution to follow. Providend was the first fee-only wealth advisory firm in Southeast Asia and is a specialist in retirement planning, including accumulating towards retirement and drawing-down in retirement. Established in 2001, the firm provides conflict-free advice on all aspects of wealth management. Endowus is an award-winning, independent fee-only wealth and fund platform and the first digital advisor in the region to span personal savings,private wealth and public pension (CPF & SRS in Singapore). It serves as a fund investment platform and fiduciary advisor to over 100,000 individuals, family offices, charities, endowments and institutions. |
Footnotes
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1Based on the information relating to expense ratios of List A funds included under the CPFIS on the CPF website as of the date of this material.
Disclosures
The Global Core Equity III Fund, Emerging Markets Large Cap Core Equity III Fund, and Global Core Fixed Income III Fund, sub-funds of Dimensional Funds PLC (the “funds”) are included under the Central Provident Fund Investment Scheme - Ordinary Account (‘OA’). The CPF interest rate for the OA is based on the legislated minimum interest of 2.5% per annum, or the 3-month average of major local banks’ interest rates, whichever is higher. In addition, the CPF Board will pay an extra interest rate of 1% per annum on the first S$60,000 of a CPF member’s combined balances (capped at $20,000 in the OA). CPF members aged 55 and above will also earn an additional 1% extra interest on the first $30,000 of their combined balances (capped at $20,000 for OA). The first S$20,000 in the CPF-OA is not allowed to be invested under the CPFIS. Investors should note that the applicable interest rates for each of the CPF accounts may be varied by the CPF Board from time to time.
The information in this material is intended for the recipient’s background information and use only. It is provided in good faith and without any warranty or representation as to accuracy or completeness. Information and opinions presented in this material have been obtained or derived from sources believed by Dimensional to be reliable, and Dimensional has reasonable grounds to believe that all factual information herein is true as at the date of this material. It does not constitute investment advice, a recommendation, or an offer of any services or products for sale and is not intended to provide a sufficient basis on which to make an investment decision. Before acting on any information in this document, you should consider whether it is appropriate for your particular circumstances and, if appropriate, seek professional advice. It is the responsibility of any persons wishing to make a purchase to inform themselves of and observe all applicable laws and regulations. Unauthorized reproduction or transmission of this material is strictly prohibited. Dimensional accepts no responsibility for loss arising from the use of the information contained herein.
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RISKS
Investments involve risks. The investment return and principal value of an investment may fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original value. Past performance is not a guarantee of future results. There is no guarantee strategies will be successful.
The principal risks of investing in the Dimensional funds may include one or more of the following: market risk, small companies risk, risk of concentrating in the real estate industry, foreign securities and currencies risk, liquidity risk, political risk, tax risk, settlement risk, risk associated with availability of market information, emerging markets risk, banking concentration risk, interest rate risk, risk of investing for inflation protection, fixed income risk and/or fund-of-funds risk. To more fully understand the risks related to an investment in the funds, investors should carefully read each fund’s prospectus.
FOR LICENSED OR EXEMPT FINANCIAL ADVISORS IN SINGAPORE
This material is deemed to be issued by Dimensional Fund Advisors Pte. Ltd. (UEN:201210847M), which is regulated by the Monetary Authority of Singapore and holds a capital markets services license for fund management.
This material has not been reviewed by the Monetary Authority of Singapore or the CPF Board.
This information should not be considered as investment advice or an offer of any security or fund for sale. All information is given in good faith without any warranty and is not intended to provide professional, investment, or any other type of advice or recommendation and does not take into account the particular investment objectives, financial situation, or needs of individual recipients. Dimensional Fund Advisors Pte. Ltd. does not accept any responsibility and cannot be held liable for any person’s use of or reliance on the information and opinions contained herein. Neither Dimensional Fund Advisors Pte. Ltd. nor its affiliates shall be responsible or held responsible for any content prepared by financial advisors.
This is a marketing communication. Please refer to the prospectus before making any final investment decisions.
DIMENSIONAL FUNDS PLC:
The Emerging Markets Large Cap Core Equity III Fund, Global Core Equity III Fund and Global Core Fixed Income III Fund are sub-funds of Dimensional Funds plc (the “responsible person” under the Securities and Futures Act) which is structured as an umbrella fund with segregated liability between sub-funds, established as an open-ended investment company with variable capital under the laws of Ireland with registration number 352043. Dimensional Funds plc is authorised by the Central Bank of Ireland as an undertaking for collective investment in transferable securities (UCITS).
The funds are offered in Singapore under the terms and conditions of the respective fund’s prospectus. The value of the shares in any fund and the income accruing to the shares, if any, may fall or rise and therefore, the return on the investment necessarily will be variable. Investors should note that the funds may from time-to-time use or invest in financial derivative instruments for hedging and/or efficient portfolio management purposes and consider the investment objectives, risks, and charges and expenses of the Dimensional funds carefully before investing. For this and other information about the Dimensional funds, potential investors should read the prospectus carefully before deciding whether to subscribe for or purchase shares in any fund. A copy of the prospectus is available and may be obtained by contacting a Dimensional representative. Past performance is not necessarily indicative of future performance.