Mutual Funds for Beginners: How to Invest in Singapore
Updated: 1 Oct 2026
Written bySingSaver Team
Team
Disclaimer: The information on this page is for general educational and informational purposes only and should not be considered financial or investment advice.
Which type of mutual fund suits you?
Before You Compare
Check the expense ratio
A 1% difference in yearly fees can cut your returns sharply over 20 years.
Look for sales charges and platform fees
Banks may charge up-front sales loads. Many online platforms charge none.
Match the fund to your risk profile
Equity funds swing more than bond or money market funds. Pick what you can hold.
Check the minimum investment
Minimums vary by fund and platform. Regular savings plans often start lower.
Confirm the fund is MAS-authorised
Check it's authorised or recognised for sale to retail investors in Singapore.
How to compare mutual funds
When comparing mutual funds, look beyond recent returns. The most useful factors are:
- Expense ratio: the yearly fee charged by the fund.
- Sales charges and platform fees: what you pay to buy and hold the fund.
- Long-term performance: 5- and 10-year returns against the fund's benchmark.
- What the fund invests in: its holdings, regions and sectors.
- Fund size and manager track record.
- Fit: whether its risk level matches your time horizon.
Most popular mutual funds in Singapore
When looking at mutual funds gaining traction among Singapore investors, several established options stand out. These funds span global, regional and local markets:
| Fund name | Symbol | Fund focus |
|---|---|---|
| 1. Mercer Global Small Cap Equity Fund | 0P0001KURQ.SI | Managed global allocation |
| 2. ChinaAMC China Focus SGD Acc | 0P0001BHO3.SI | Regional focused equity |
| 3. LionGlobal Singapore Trust SGD Acc | 0P00006G00.SI | Domestic blue chip core |
| 4. Eastspring Investments Unit Trusts – Pan European Fund | 0P00006Q05.SI | Developed European equities |
| 5. Wellington Strategic Eurp Eq SGD S AcH | 0P0001Q9OC.SI | Currency-hedged active equity |
| 6. PineBridge Global Focus Equity A5HDC | 0P0001T4KB.SI | Diversified global equity |
| 7. HSBC Life Emerging Markets Opps Fd | 0P0000X6H8.SI | High-growth emerging markets |
| 8. AIA Emerg Mkts Equity | 0P000090O8.SI | Emerging markets equity |
| 9. AIA Growth Fund | 0P00008T6G.SI | Core local capital appreciation |
| 10. GMO Quality Investment ZH SGD Acc | 0P00006OE7.SI | Global defensive quality |
Note: Funds 7 to 9 are investment-linked policy (ILP) sub-funds, available only through the insurer's policies. Short-term returns fluctuate daily, so check each fund's 3- and 5-year annualised returns in its prospectus or factsheet before investing.
How to start investing in mutual funds
Ready to get started? Here's how to invest in mutual funds in Singapore, step by step.
1. Decide on whether you want to invest in active or passive funds
Your first choice is a crucial one: should you aim to beat the market, or simply track it? This decision significantly affects your costs, potential returns and how involved you need to be.
- Active funds (traditional mutual funds or unit trusts) are professionally managed by fund managers who buy and sell assets to try to outperform a benchmark index.
- Passive funds, such as index funds and Exchange-Traded Funds (ETFs), simply track an index. They typically have much lower fees.
Many beginners blend both: passive funds for broad, low-cost market exposure, and a few active funds for specific regions or sectors.
>> Read: What are exchange-traded funds
2. Calculate your budget for investing
Before you buy your first mutual fund, work out how much you can comfortably invest without touching your emergency fund. Cash left idle in low-yield accounts can lose purchasing power to inflation over time, which is one reason to put spare savings to work.
Mutual funds often have accessible minimum investments, from a few hundred to a few thousand Singapore dollars, and many platforms offer monthly regular savings plans. Factor your risk profile into this budget. Younger investors with a longer horizon may lean towards growth-focused equity funds, while those nearing a financial goal may prefer to preserve their capital.
>> Read: The best brokers for mutual funds
3. Decide where you should buy the mutual funds
In Singapore, you can buy mutual funds through:
- Online brokerages and fund platforms: These offer wide fund selections, often with no sales charge and competitive platform fees.
- Traditional banks: These give you a consolidated view alongside your savings accounts, but watch out for sales charges.
- Robo-advisors: Platforms such as StashAway build and rebalance a diversified portfolio for you based on your risk profile.
- CPF and SRS: You can invest your CPF Ordinary Account savings in funds included under the CPF Investment Scheme (CPFIS), and use your Supplementary Retirement Scheme (SRS) funds to buy eligible unit trusts.
When choosing a platform, compare four things:
- Cost: sales charges, platform fees and custody fees.
- Available choices: access to local, regional and global fund houses.
- Tools: portfolio tracking and analytics.
- Ease of use.
>> Read: How to pick the best mutual funds
4. Understand the mutual fund fees
Regardless of your structural strategy, fund management companies levy recurring fees for administration and operation, compressed into a single figure known as the Expense Ratio. For instance, an expense ratio of 0.75% means you pay S$7.50 annually for every S$1,000 invested. These fees are deducted directly from the fund's asset value, directly impacting your net returns over time.
>> Read: How to invest in stock in Singapore
Mutual funds generally fall into two structural buckets:
-
Open-end funds: The most prevalent structure in Singapore. These funds dynamically issue and redeem shares based on investor demand. Buying or selling occurs at the daily Net Asset Value (NAV), calculated at the close of the trading day.
-
Closed-end funds: These issue a fixed number of shares via an initial launch and subsequently trade publicly on exchanges like the Singapore Exchange (SGX). Because they are traded openly, their market price can deviate into a premium or discount relative to their actual NAV.
>> Read: Online brokerages in Singapore
5. Managing your mutual fund portfolio
The work doesn't stop once you pick your funds. Sound portfolio management dictates that you periodically rebalance your holdings—typically once a year—to keep your asset distribution aligned with your original risk intent.
If global stock indices outpace other assets, your portfolio may inadvertently become top-heavy with risk. Rebalancing ensures you systematically harvest profits from outperforming sectors and reallocate them to undervalued segments, protecting your wealth through a healthily diversified, evergreen approach.
Best long-term mutual funds
The best long-term mutual funds for most investors are low-cost and broadly diversified. Over 10 years or more, these fund types are commonly used as a portfolio core:
- Global equity index funds: These track thousands of companies worldwide at low cost, so you aren't relying on one market or fund manager.
- Diversified global equity funds: These are actively managed funds that invest across regions and sectors. Compare their fees and long-term performance against a global index.
- Balanced (multi-asset) funds: These mix stocks and bonds in one fund. They're a simpler option for beginners who want growth with fewer swings.
For long-term investing, focus on a fund's 10-year track record, low fees and how well it fits your goals, rather than last year's top performers.
Best low-risk mutual funds
If protecting your capital matters more than growth, the best low-risk mutual funds tend to be:
- Money market funds: These invest in short-term deposits and government bills. They're the lowest-risk option, suited to cash you may need soon.
- Short-duration bond funds: These hold bonds that mature soon, so their prices swing less when interest rates change.
- Singapore dollar bond funds: These invest mainly in Singapore Government Securities and high-quality corporate bonds, with no foreign currency risk.
Low risk doesn't mean no risk. Unlike fixed deposits, these funds aren't capital-guaranteed or covered by SDIC deposit insurance.
Types of mutual funds
Understanding the main fund types helps you build a portfolio that suits you. Most investors combine three traditional pillars: stock, bond and money market funds.
Stock mutual funds equal to higher potential returns (or losses)
Stock mutual funds (equity funds) invest mainly in shares of listed companies, making them suited to long-term growth. They carry higher volatility, but can capture broad economic growth.
For instance, a Singapore equity fund gives you concentrated exposure to local market leaders such as the major banks. A regional Southeast Asian or global technology fund, by contrast, offers exposure to different growth cycles, but with higher sector-specific volatility.
>> Read: The best bond index funds
Bond mutual funds equal to lower returns (but lower risk)
Bond mutual funds focus on fixed-income securities, creating a smoother investment curve with a regular income stream. A localized Singapore bond fund heavily weights highly creditworthy Singapore Government Securities (SGS) or investment-grade corporate bonds issued by established local entities. They serve as reliable portfolio anchors, stabilizing your broader net worth when equity markets encounter turbulent cycles.
>> Read: Bond options in Singapore
Money market mutual funds equal to lowest returns, lowest risk
Money market mutual funds invest in short-term, high-quality debt such as bank deposits and short-dated government bills. They prioritise liquidity and protecting your principal.
When evaluating these funds, compare their yields with Singapore's low-risk alternatives. For example, the most recent 6-month Singapore T-bill yielded 1.70%, and the latest Singapore Savings Bond offers a 1-year average return of 1.65%. Money market funds work best as a place to park cash you plan to invest or spend soon, rather than as a tool for growing wealth.
Is it possible to lose money in mutual funds?
Yes, it is entirely possible to lose money in mutual funds. Mutual funds are subjected to market fluctuations, macroeconomic systemic shocks, and localized asset underperformance. However, the risk of losing your entire principal is significantly mitigated compared to buying individual corporate stocks, as a single mutual fund spreads its underlying holdings across dozens or hundreds of independent entities. Adopting a strict long-term horizon allows compounding to smooth out interim market drops.
Summary
Establishing explicit financial goals acts as your compass, protecting you from the psychological traps of chasing temporary market trends. Carefully match your fund selections to your specific time horizon and risk tolerance to ensure your portfolio remains stable across changing economic seasons. Keep a close eye on administrative costs; managing your ongoing platform fees and expense ratios is paramount to defending your returns. Finally, commit to routine annual portfolio check-ins, guaranteeing that your asset allocation remains healthily diversified and tuned to your evolving life goals.
>> Read more: Why mutual funds are great during volatile periods
Frequently asked questions about mutual funds
Yes. Mutual funds give beginners instant diversification and professional management, so you don't need to pick individual stocks. Low-cost, diversified funds and monthly regular savings plans make it easy to start small.
Open an account with an online brokerage, fund platform, bank or robo-advisor. Then choose a fund that matches your goals and risk profile, and invest a lump sum or a fixed amount each month. You can also use CPF or SRS funds for eligible funds.
Mutual funds carry market risk, so their value can fall. However, funds offered to retail investors in Singapore must be authorised or recognised by the Monetary Authority of Singapore (MAS), and fund assets are typically held by an independent trustee or custodian.
Disciplined, long-term investing in low-cost, diversified funds can build significant wealth over decades through compounding returns, especially if you keep fees low and stay invested through market downturns. Returns aren't guaranteed, though.
Yes. Your investment value will rise and fall with the market. Staying diversified and avoiding panic-selling during market corrections can help protect your portfolio over time.
There's no single "best" fund. The right fund depends on your goals, time horizon and risk profile. Beginners often start with low-cost, globally diversified equity or balanced funds, while those prioritising safety may prefer money market or bond funds.
About the author
SingSaver Team
At SingSaver, we make personal finance accessible with easy to understand personal finance reads, tools and money hacks that simplify all of life’s financial decisions for you.
The information on this page is for educational and informational purposes only and should not be considered financial or investment advice. While we review and compare financial products to help you find the best options, we do not provide personalised recommendations or investment advisory services. Always do your own research or consult a licensed financial professional before making any financial decisions.