While the government could do more, or anything really, to encourage the development and proliferation of low cost, well diversified index unit trusts (Singapore’s equivalent to mutual funds) — simply implementing the last round of CPF panel recommendations would help — the government isn’t stopping the private sector in this respect. Blame Singaporean investors and unit trust providers and sellers for persistently high costs.
The history in the U.S. is really all about Jack Bogle founding Vanguard as a not for profit mutual association — and then his not being a jerk about his own total compensation, which by Wall Street standards was modest. Yes, OK, it’s helpful that Vanguard’s founding roughly coincided with the development of 401(k) plans (a regulatory invention) and, later, the Internet. But there’s no particular impediment to history repeating itself in Singapore, and SRS accounts already exist. And the sclerotic unit trust market is getting more competitive with the growth of zero fee platforms and more savvy investors.
In the Singapore context, maybe TCC Credit Co-operative could/should get in this business, offering low cost “target date” funds (via automatic GIRO deductions) that are index funds of index funds? The underlying funds would be VWRA (or IWDA), ES3 (or G3B), and MBH. All distributed dividends would be automatically reinvested.
The 1974 date is simply when Temasek was founded. Any monkey with a Singaporean or “Asian” bias could have made/did make a lot of money in 1970s and 1980s Singapore. Good for Temasek that Singapore rapidly and successfully transformed from an emerging economy to a developed one, but you don’t measure a fund management team’s performance based on one-time historical happenstance. It should always be relative to reasonable baselines (“monkeys”), inclusive of the happenstance as part of your baseline.
To start to get some sense of what’s going on, you could look at various performance intervals: 1, 3, 5, 10, 20, 30 (years), and Inception.
