Endowus Core-Flagship Cash/SRS Portfolio

The 100% Equity Portfolio declined by -1.1% in February, yet it outperformed the broader equity benchmark, demonstrating resilience in a challenging market.

• The Flagship Cash 100% Equity Portfolio posted a -1.1% return after fees outperforming the equity market’s return of -1.3% (before fees).
• A key driver of the portfolio’s performance was its tilt towards emerging market equities as emerging markets outpaced developed markets equities during the month. This positioning, implemented through the Dimensional Emerging Markets Large Cap Core Equity Fund and the Amundi Index MSCI Emerging Markets Fund, proved beneficial.
• The best performing fund for the month was the Dimensional Pacific Basin Small Companies Fund as it rose 0.8% for the month. 

In February, the 100% Fixed Income Portfolio posted strong positive returns, returning 1.2% and outperformed the broader fixed income market by about 0.1%.

• The global fixed-income market, as measured by the Bloomberg Global Aggregate Index, posted strong returns in February as yields fell.
• All the underlying fixed-income funds posted positive returns for February and outperformed the benchmark with the exception of the iShares Global Aggregate 1- 5 Year Bond Index Fund, as its shorter duration detracted from performance.
• The best-performing fund in the fixed-income sleeve was the PIMCO GIS EM Market Bond Fund.

Endowus Core-Flagship CPF Portfolio

Note: The Flagship CPF Portfolio allocations were updated in July with three new funds from Dimensional. 

The 100% Equity Portfolio declined by -1.4% in February, underperforming the broader equity benchmark.

• The CPF 100% Equity Portfolio slightly underperformed the broader global equity market in February 2025, returning -1.4% over the month.
• The portfolio allocation to the Schroders Global Emerging Market Opportunities Fund was the main detractor from performance recording a 3.2% loss as the fund’s overweight to the technology sectors and their geographical underweight to China dragged performance over the month.
• Within the equity sleeve, the Dimensional Global Core Equity III Fund was the best performer for the month. 

‍The 100% Fixed Income Portfolio posted strong positive returns, returning 1.0% and slightly underperforming the broader fixed income market by about 0.1%

• The global fixed-income markets, as represented by the Bloomberg Global Aggregate Index, demonstrated positive performance across the board in January 2025. 
• The 100% Fixed Income Portfolio also experienced growth, albeit to a lesser extent than the broader market. This relative underperformance can be attributed to the portfolio's shorter duration positioning, which made it less sensitive to interest rate fluctuations.
• The best-performing fund in the fixed-income sleeve was the Dimensional Global Core Fixed Income III Fund while the worst-performing fund was the Eastspring Singapore Select Bond Fund. 

Endowus Income Portfolios

The Stable Income Portfolio gained in February and performed in line with the broader credit market

• The Portfolio’s exposure to US rates added to relative performance as US yield decreased on the back of renewed growth concerns and the US rates market outperformed other rates markets. 
• Portfolio allocation to Asian and emerging markets bonds also contributed to relative return, as the Asian bond market experienced relative strength in February. 
• The best-performing underlying fund in February was the PIMCO GIS Income Fund (+1.7%).

The Higher Income Portfolio delivered positive returns in February, albeit slightly lagging the 20-80 benchmark

• Its fixed income component lagged the broader credit market due to its allocation to global high yield bonds, which detracted from relative performance because of the sector’s slight spread widening and shorter duration. 
• Its equity component outperformed the global equity market slightly due to its overweight exposure to emerging markets equities and Asian equities, both of which outperformed the global equity market in February. Its overweight exposure to real assets also contributed to relative performance as the sector was one of the best performing equity sectors, benefiting from rate declines. 

The Future Income Portfolio delivered positive returns in February, outperforming the 40-60 benchmark

• Its fixed income component outperformed for reasons similar to that of the Stable Income.
• Its equity component outperformed the global equity market due to its overweight exposure to the European equities market, which rallied as investors increasingly factored in the likelihood of a ceasefire in Ukraine. The slight overweight exposure to Asian equities also helped with relative performance.

All three Income Portfolios are achieving their payout targets 

• Actual payouts have remained stable despite the fluctuation of prices across the three Portfolios. Volatility in price returns will result in mark-to-market changes (decrease or increase) in the Portfolio value, but will not impact the actual coupon payments or dividend payouts from the underlying funds. 
• Yields in the fixed-income market have risen meaningfully following the increase in global interest rates, creating a higher-yield environment for income-seeking investors. 
• The changing interest rate environment has resulted in a divergence between the respective payout yields of Stable Income and Higher Income. This divergence is a reflection of the enhanced ability of investment grade flexible income funds to generate income in the current environment of elevated interest rates, compared to high yield and equity funds. 
• These dynamics were pivotal in the Recommended Portfolio Change in Nov 2023, where we improved the credit quality of all three Portfolios while maintaining the target payout levels. As we continue to monitor these evolving market conditions, it's crucial to remember that the Higher Income Portfolio is strategically crafted to yield a higher total return than the Stable Income Portfolio over the long term

Endowus Cash Smart Portfolios

Cash Smart Secure continued to generate stable and positive returns

• The Secure Portfolio maintained its stable return profile, posting a 0.2% gain in February 2025. 
• This performance could be attributed to the continued positive returns from both the underlying funds, the Fullerton SGD Cash Fund and the LionGlobal SGD Enhanced Liquidity Fund, which contributed 0.2% and 0.3%, respectively. 

Cash Smart Enhanced sees modest gains in February

• Cash Smart Enhanced generated a return of 0.4% during the month.
• This performance was supported by steady returns from the two underlying money market funds, Fullerton SGD and LGI SGD Enhanced Liquidity. Additionally, the UOBAM United SGD Fund provided a slight boost due to its relatively longer duration, benefiting from the rally in fixed income markets in February.

Cash Smart Ultra benefitted from allocation into longer duration and credit components

• Cash Smart Ultra achieved a return of 0.5% in February.
• The largest contribution came from the PIMCO Low Duration Income Fund, which provided 1.2% in returns. Other underlying funds, such as the Fullerton Short Term Interest Rate Fund, also delivered positive returns, supported by their relatively longer duration strategies.

As the rate environment normalises, although with continued volatilities along the way, we observe that the returns of the three Cash Smart Portfolios align with their respective risk profiles.

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