The family office managing this allocation oversees approximately S$2.8bn across liquid and illiquid assets. It is a single-family office established in Singapore in 2018 under the Monetary Authority of Singapore's Section 13O family office incentive scheme. The principal family's wealth originates in regional manufacturing. The family's investment committee meets monthly; the CIO is a former head of Asia fixed income at a global bank.
The allocation below reflects the portfolio as of May 31, 2026. It was shared with AVI on the condition that the office and the family not be identified. The desk has edited for clarity but not changed any figures or characterisations. The views expressed are the contributor's. AVI is publishing this because the allocation logic is specific enough to be useful and generic enough not to be identifiable. Nothing in this memo constitutes investment advice.
Figures may not sum to 100% due to rounding. Strategic target allocations differ from current holdings; current allocation reflects deliberate tactical tilts described in the memo. As of 31 May 2026.
Why IG credit at 32%
The strategic target for fixed income is 20%. The office is running 12 percentage points above that. The reason is straightforward: all-in yields at 5.8–6.2% for Asia IG dollar bonds are the most attractive since 2008 on an unlevered basis. The CIO's view is that we are eighteen to twenty-four months past the peak of the rate cycle and that the spread widening in Asia IG over the past two quarters represents credit concern in a subset of the market, principally Hong Kong property, not a broad deterioration in credit quality across the asset class.
Within the IG credit allocation, the office is overweight Korean banks, Indian state-owned enterprises, and Singapore REITs. It is underweight Hong Kong and mainland China property. The office sold its last NWD position in February, when the Oct 2027s were yielding 6.4%. The bonds now yield 8.92%. The CIO noted in the May investment committee meeting that the exit was earlier than ideal but that the credit concern was visible in the covenant coverage ratio twelve months before it priced into the secondary market.
The office does not use leverage in its liquid fixed income book. The all-in yield of 5.9% on the blended IG portfolio compares with the Singapore-dollar savings rate of 3.5% offered by local banks' fixed deposits. The unlevered carry is sufficient; adding leverage to a 5.9% gross yield book in the current funding environment would add perhaps 80bp of net carry at a cost of substantially more duration and credit risk. The committee voted against it three consecutive quarters.
Public equity at 28%
The strategic target for public equity is 25%. The office added 10 percentage points of equity in Q1 2026, buying into the drawdown that ran from October to December 2025. It had been underweight equity since Q3 2024, when it reduced from 28% to 18% on concerns about the combination of expensive US valuations, yen carry unwind risk, and Hong Kong property credit stress. The Q1 re-entry was concentrated in Asia ex-Japan.
The geographic tilt is India overweight, Korea equal weight, China and Hong Kong underweight versus MSCI Asia ex-Japan benchmark weights. The India overweight reflects confidence in domestic consumption growth, the infrastructure spending cycle, and the Nifty 50's relatively modest exposure to global credit conditions. The China underweight has been in place since mid-2023 and reflects the office's view that the policy support announced over the past eighteen months has stabilised rather than reflated the economy — a different thing.
Japan is held separately from the Asia ex-Japan mandate. The office runs a 4% allocation to Japanese equities, focused on domestic-facing financials and consumer names. The CIO's view is that the BOJ's gradual rate normalisation benefits net interest margin for Japanese banks and hurts export-heavy manufacturers. The 4% Japan allocation is below the MSCI ACWI weight of approximately 6% but is intentionally concentrated in the sectors expected to benefit from rate normalisation.
Cash at 11%
The long-run cash target is 6%. Cash peaked at 18% in Q4 2025, held in a combination of Singapore-dollar fixed deposits and US Treasury bills. The office reduced to 11% during the Q1 equity re-entry. The remaining 5 percentage points above target reflect two things: dry powder for the private equity programme, which has three investments under negotiation, and a residual tactical caution about whether the Q1 equity rally extends through mid-year without a correction.
The CIO's characterisation: "We are not underinvested. We are underinvested in the things we think are too expensive, and we are holding cash against things we want to buy that are not yet available at the right price." The committee minutes from April reference three private equity targets in Southeast Asian consumer and logistics. The office expects to deploy S$180–200m into private equity in H2 2026.
The macro frame
The investment committee's working view is that global markets are mid-cycle, not late-cycle. The distinction matters for portfolio construction. In late cycle, cash and short-duration fixed income dominate. In mid-cycle, the office's framework calls for overweighting risky assets against a baseline of quality credit. The office defines mid-cycle as the period after the rate peak but before the rate normalisation is fully priced into credit spreads and equity multiples — roughly where they assess the current environment to be.
[Inference] The desk notes that "mid-cycle" is a judgement call, not a fact. Other well-informed allocators would look at the same data and reach different conclusions about the cycle position. The contributor's framework is described here as a concrete example of how one sophisticated allocator is translating a macro view into a portfolio. The desk does not endorse or dispute the framework. Readers should assess it against their own views and mandates.
The office's next formal rebalancing review is scheduled for September 2026. The CIO said the triggers for reducing IG credit before then would be either a sharp spread tightening that removes the yield premium (below 5.2% all-in on the blended book) or a deterioration in the credit environment beyond Hong Kong property into Korean or Indian corporates. Neither has happened yet.