Not exactly sure why Nikko AM is very stingy, as usual, with news regarding their funds. Thus, like what I did last year, I’ll do a public service announcement and “release” their dividends here to help people get hold of this information.
As usual, SGX is one of the best source of definite dividends information and I’ll re-post it here. For your information, the dividends for ABF Singapore Bond Index Fund for 2015 was S$0.0305.
ABF Singapore Bond Index Fund ETF – 2016
Ex-Date : 04 Jan 2016
Record Date : 06 Jan 2016
Date Paid/Payable : 15 Jan 2016
Amount : SGD 0.0265
At the current price of $1.156 quoted by Bloomberg, the declared dividend represents a yield of 2.29%.
Interest Rate Hike
Much have been said and predicted about the interest rate hike and from the chit-chat I’ve been hearing, there are some concerns on holding ABF SG Bond Index Fund based on the assumption that interest rate will slowly rise to the target of 3.25% in three years.
Although I’m tempted to write on this topic, I think many others before me are much better writers and can better convey the correct information more precisely.
One of the article I’ve read a long time ago, more than 2 years before the actual interest rate increase, is written by Kyith of Investment Moats. I don’t think I could have written any better than him and the article is very useful in helping to explain why a bond ETF can benefit from a rising interest rate environment. There is a need to look at the total returns perspective.
For further reading, consider this Betterment article as well.
A diversified bond basket can actually benefit from rising interest rates. Investors might think otherwise because of the mechanics of basic bond math (‘when rates go up, yields go up and prices go down’). But, that’s not the whole story: A diversified bond basket can actually benefit when rates rise.
What about Nikko AM Singapore STI ETF dividend? (ex-date 04 Jan 2016)
Ans : SGD 0.0452
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