Is Lion-OCBC Global Income 2021 Fund worth to invest?

The short answer is No

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because is not principal protected and the proposed distribution payment might may have the effect of lowering the net asset value of the Sub-Fund. Moreover, distributions out of capital may amount to a reduction of a Holder’s original investment.

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The long answer is

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you need to apply the math yourself and project in 3 years time whether the ROI is worth the charges.

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Use the information below if the factsheet is TLDR

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The annual management fee for the product is

1.4% per annum in Year 1,

1.0% per annum in year 2, and

0.6% per annum in year 3,

after a 0.1% rebate on an semi-annual basis.

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The annual trustee fee for the product is

0.1% per annum subject to a minimum of SGD$8k per annum

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The one-time sales charge is up to 3% at the point of sale.

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The Sub-Fund will be valued on each Dealing Day. The indicative prices of Units are quoted on a forward pricing basis and will likely be available 2 Business Days

in Singapore after each relevant Dealing Day and the price can be checked at

http://www.lionglobalinvestors.com/en/funds/lio...

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Cooling period

You may cancel your

subscription of Units within 7 calendar days from the date of subscription by submitting

a Notice to Cancel Form to us or our authorised distributors, subject to cancellation terms and conditions.

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The fund intend to make a distribution at the end of every quarter, on or around

31 March, 30 June, 30 September and 31 December of every year. The proposed distribution payments are as follow:

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Year 1 - 3.5% per annum, Year 2 – 4% per annum,

Year 3 – at least 1.5% per annum.

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Distributions for the Sub-Fund will commence from the second quarter onwards from the Inception Date (or such

period as they may determine at their sole discretion).

You will receive your realisation proceeds within 7 Business Days from the day they received your realisation request form or upon maturity Date 3 years later

Source of details: https://api.fundinfo.com/document/8b431ccfb6c1a...

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Hope my reply helps.

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Thank you.

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Definitely a NO.

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1. Buying of options - you need to be RIGHT 100% to even smell profits. If the price is no where near the call option's strike price upon expiry, the premium paid to purchase the call option effectively becomes toilet paper.

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2. Investments should be simple and easy to understand. If you don't understand how the call option will work, don't invest. Caveat emptor

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2a. Linked to the call option structure of the fund, and I quote from the product highlight sheet "... will be linked to returns generated by the OCBC-LGI VT Index, which provides exposure to multi-assets including equities, fixed income and gold. The Index comprises of fixed income ETFs, equity ETFs, gold ETFs, indices and cash." Do you even understand this? How many layers of funds and (internal) fees are we talking about here? How much in fees will be saved if the call option is not in the fund?

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3. "Fund aims to provide distributions..." - no guarantee this will happen

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4. Fees and sales charges. My main bugbear when it comes to managed funds. Never a good thing. Unless you can find me a fund that returns and compounds at 40% for 20 years straight while charging 10% fees, I'll happily suck it up.

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My take on the whole thing is, if you want to invest in a bond fund, invest in a bond fund. You want options, invest in a fund comprised of options (which is treading in the realm of hedge funds). Don't mix the two, unless you are very sure of what you are getting into after listening to the TL:DR version of the prospectus pitched by the sales staff. Do your due diligence before getting into this investment, or any investments out there.

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Hope this helps, and all the best.