Kuala Lumpur, April 28 – Eastspring Investments Berhad has announced the gross income distribution for Eastspring Investments Target Income Fund 5 (“Fund”):
This 5 year closed-ended bond fund is the fifth in a series of target income funds. This distribution is consistent with the Fund’s objective which endeavours to provide regular income[1] during the tenure of the Fund.
All unit holders who have maintained their unit holdings in the Fund as at 26 April 2017 will be entitled to the income distribution.
Market Outlook from the External Investment Manager, Eastspring Investments (Singapore) Limited
Heightened geopolitical tensions in the Middle East and the Korean Peninsula, as well as dwindled optimism on tax reform and de-regulation prospects in the US, have dampened risk appetite somewhat. In Asia, credit spreads have widened modestly since month-end as a result.
Our current base case scenario is that these geopolitical tensions are unlikely to escalate to wide-scale violent conflicts in near term. We continue to hold the view that Asian investment grade credits look attractive from a total return perspective, especially following some spread widening of late. We would therefore look for opportunities to extend duration in this space.
On the other hand, we still see the overall valuation of Asian high yield credits to be on the tight side, as we have yet to see any meaningful price corrections. We remain more comfortable with shorter-dated high yield corporates at this stage, as they still offer decent yields and are likely to be less volatile. We would look for better entry level for longer-dated high-yield credits.
[1] Income declared will be paid out either by way of E-payment according to unit holders’ instructions in the account opening form or by cheque.