Top bond ETFs to watch in Singapore in 2026
Singapore bond ETFs are benefiting from falling yields, tighter supply, and strong demand for safe-haven assets. The 10-year yield fell as low as 1.75% in 2025. This guide examines leading Singapore bond ETFs and how to trade/ invest in them.
Key takeaways
- Singapore bond ETFs now offer yields up to 6.0% with falling interest rates creating opportunities.
- When rates rise, bond ETF prices typically fall - this is the main risk to watch.
- Trade with leverage, go short on price falls, and use guaranteed stops without owning the underlying bonds.
What are bond ETFs?
A bond ETF (exchange-traded fund) is an investment fund that holds a diversified portfolio of bonds and trades on stock exchanges like individual shares. These funds provide exposure to the bond market without requiring investors to purchase individual bonds directly.
How do bond ETFs work?
Bond ETFs track the performance of a specific bond index or basket of bonds. The underlying holdings typically include:
- Government bonds: Such as Singapore Government Securities (SGS), which carry AAA credit ratings²
- Corporate bonds: Issued by companies, categorised by credit ratings from investment grade to high yield
- International bonds: Foreign government or corporate debt securities
- Specialised bonds: Including inflation-protected securities or emerging market debt
Bond ETFs generate returns through two mechanisms. First, they distribute regular dividends from the interest payments of underlying bonds, typically on a semi-annual or quarterly basis³. Second, when interest rates fall, existing bond prices tend to rise, increasing the ETF's net asset value.
Unlike individual bonds, bond ETFs trade throughout market hours, providing greater liquidity than traditional over-the-counter bond trading⁴.
Advantages and disadvantages of trading/ investing in bond ETFs
Understanding both the benefits and limitations of bond ETFs helps inform your trading/ investing decisions.
Advantages of bond ETFs
Diversification benefits
Bond ETFs provide instant diversification across multiple bonds, reducing the risk associated with individual bond defaults. Singapore's ABF Bond Index Fund, for example, includes government bonds across multiple issuers, providing stability and reducing single-issuer exposure⁵.
Enhanced liquidity
Unlike individual bonds traded over-the-counter, bond ETFs trade on exchanges during market hours, offering better liquidity and price transparency⁶.
Cost efficiency
SGX-listed bond ETFs have expense ratios ranging from 0.20% to 0.50%⁷, typically lower than actively managed bond funds. The ABF Singapore Bond Index Fund, for instance, has an expense ratio of just 0.24%⁸.
Regular income
Bond ETFs distribute dividends regularly. Recent data shows SGX-listed bond ETFs have recorded 12-month dividend yields between 2.31% and 7.59%⁹.
Disadvantages of bond ETFs
Interest rate sensitivity
Bond ETFs are highly sensitive to interest rate changes. The ABF Singapore Bond Index Fund temporarily fell by 5.8% within a two-week period in March 2020 when 10-year Singapore government bond yields increased by 0.76%¹⁰.
Tracking errors
Bond ETFs may underperform their benchmark indices due to management fees and transaction costs. SGX-listed bond ETFs may have annual tracking errors ranging from 0.1% to 0.3%¹¹.
Credit risk
Corporate bond ETFs carry credit risk, particularly during economic downturns when underlying issuers may struggle to repay debt¹².
No maturity date
Unlike individual bonds, bond ETFs don't have fixed maturity dates, meaning there's no guarantee of recovering the full principal at any specific point¹³.
Current market conditions for Singapore bond ETFs
Several factors continue to make Singapore bond ETFs a compelling and potential portfolio consideration heading in 2026:
Interest rate environment
- Singapore’s 10-year government bond yield has declined sharply to 1.85% (November 2025), down from 2.29% in June — the largest drop among emerging Asian markets.
- Barclays projects further easing, forecasting a year-end yield of 1.60%, driven by reduced net bond supply, seasonal liquidity improvements, and investor rotation away from US assets.
- The US Federal Reserve has held policy rate steady at 4.25% to 4.50% since January 2025, reinforcing a “higher-for-longer” stance that supports demand for diversified fixed-income exposure.
Market performance
Bond ETFs have benefited from interest rate decline and liquidity tailwinds:
- Corporate bond ETFs continue to deliver solid returns, with recent performance supported by tighter credit spreads and stable fundamentals.
- Bond ETFs like the ABF Singapore Bond Index Fund remain a popular choice, buoyed by strong demand for government bonds amid global uncertainty and local supply constraints.
- Investors are increasingly using bond ETFs to capture attractive coupons while maintaining flexibility in a volatile macro environment.
Regulatory environment
- Singapore retains its AAA credit rating, outperforming the US and many other developed markets.
- This top-tier rating reinforces investor confidence and supports the resilience of Singapore-denominated bonds, especially in times of global risk aversion.
Top Singapore bond ETFs to watch in 2026
ETF
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Latest yield*
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Year-to-date (YTD) share price return*
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Available for CFD trading with IG?
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Available for investing with IG Markets Singapore app?
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Amova SGD Investment Grade Corporate Bond ETF
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3.2%
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7.2%
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❌
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✔
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2.3%
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7.4%
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❌
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✔
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iShares USD Asia High Yield Bond ETF
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~6.5%
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2.9%
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✔
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✔
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~5.0%
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6.2%
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✔
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✔
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~4.2%
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5.8%
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❌
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✔
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1. Amova SGD Investment Grade Corporate Bond ETF (SGX: MBH)
Key details:
- Expense ratio: 0.26%
- Distribution: Semi-annually
- Latest yield (November 2025): 3.16%
- YTD return: 7.15%
- NAV: S$1.03
- 52-week range: S$0.97 to S$1.03
- Top holdings: SGD-denominated investment-grade corporate and quasi-sovereign bonds
What’s the latest? Amova SGD Investment Grade Corporate Bond ETF tracks the iBoxx SGD Non-Sovereigns Large Cap Investment Grade Index. It has benefited from strong demand for Singapore dollar (SGD) credit amid a pullback from US Treasuries. Its price reached a 12-month high in November 2025, supported by tighter credit spreads and stable corporate fundamentals.
2. ABF Singapore Bond Index Fund (SGX: A35)
Key details:
- Expense ratio: 0.24%
- Distribution: Semi-annually
- Latest yield (November 2025): 2.27%
- YTD return: 7.41%
- NAV: S$1.1589
- 52-week range: S$1.05 to S$1.17
- Top holdings: Over 80% in Singapore government and quasi-government bonds
What’s the latest? ABF Singapore Bond Index Fund tracks the iBoxx ABF Singapore Bond Index. It remains a popular choice for investors seeking sovereign-grade stability. With the Singapore 10-year yield falling to 1.85%, the fund has seen price appreciation and increased trading volumes, making it a potential defensive anchor in volatile markets.
3. iShares USD Asia High Yield Bond ETF (SGX: O9P)
Key details:
- Expense ratio: 0.50%
- Distribution: Quarterly
- Latest yield (November 2025): ~6.5% (estimated)
- YTD return: 2.86%
- NAV: US$6.81
- 52-week range: US$6.34 to US$6.82
- Top holdings: USD-denominated high-yield bonds from Asian issuers
What’s the latest? iShares USD Asia High Yield Bond ETF provides exposure to USD-denominated high-yield corporate bonds issued by Asian companies. It has stabilised after a volatile 2024, with improving sentiment around Asian credit and expectations of Fed rate cuts in 2026. Traders typically watch for spread compression and refinancing activity among key issuers.
4. Lion-Phillip S-REIT ETF (SGX: CLR)
Key details:
- Expense ratio: 0.50%
- Distribution: Semi-annually
- Latest yield (November 2025): ~5.0% (estimated)
- YTD return: 6.23%
- NAV: S$0.87
- 52-week range: S$0.72 to S$0.90
- Top holdings: Singapore-listed REITs screened by Morningstar
What’s the latest? Lion-Phillip S-REIT ETF invests in high-quality Singapore REITs, offering bond-like income with equity-like growth potential. S-REITs delivered double-digit total returns in Q3 2025, driven by falling interest rates and resilient rental income. CLR remains a popular income-generating ETF for moderate-risk investors.
5. UOB APAC Green REIT ETF (SGX: GRN)
Key details:
- Expense ratio: 0.45%
- Distribution: Semi-annually
- Latest yield (November 2025): ~4.2%
- YTD return: 5.8%
- NAV: S$1.01 (estimated)
- 52-week range: S$0.95 to S$1.02
- Top holdings: Green-certified REITs across Singapore, Japan, and Australia
What’s the latest? UOB APAC Green REIT ETF tracks the iEdge-UOB APAC Green REIT Index, focusing on REITs with certified green buildings. It has gained traction in 2025 as environment, social, and governance (ESG) mandates expand and institutional flows favor sustainable portfolios. GRN offers regional diversification and potential income upside for ESG-conscious investors.
How to trade and invest in bond ETFs with IG Singapore
CFD share trading
- Create a live or demo account
- Find an opportunity among one of our 10,000+ stocks with our stock screener
- Click ‘buy’ to go long or ‘sell’ to short
- Set your position size
- Take steps to manage your risk
- Open and monitor your position
Investing
- Open an account via IG Markets Singapore app
- Search for Singapore bond ETFs on the app
- Choose the shares you want to buy
- Determine how many shares you want to purchase
- Place your order
- Monitor your investment and collect any dividends
Singapore bond ETFs FAQs
Can I invest in Singapore bond ETFs from Singapore?
Yes, Singapore bond ETFs such as the ABF Singapore Bond Index Fund (SGX: A35) and Nikko AM SGD Investment Grade Corporate Bond ETF (SGX: MBH) are listed on the SGX and can be traded through local CFD brokers like IG Singapore. These platforms offer real-time access, competitive fees, and integration with CPF/SRS accounts for eligible ETFs.
For investing, use the IG Markets app.
Are Singapore bond ETFs suitable for long-term investing?
Absolutely. Bond ETFs like A35 and MBH are designed to provide stable income and capital preservation, making them ideal for long-term investors. They offer exposure to high-quality government and corporate bonds, with consistent distributions and relatively low volatility.
Are Singapore bond ETFs suitable for beginner traders and investors?
Yes. Bond ETFs like A35 and MBH are beginner-friendly due to their transparency, low fees, and diversified exposure. They offer a simple way to access fixed income markets without needing to manage individual bonds. Investors can also use dollar-cost averaging and CPF/SRS contributions to build long-term positions.
What are the risks of investing in Singapore bond ETFs?
While bond ETFs are generally lower risk than equities, they are not risk-free. Key risks include:
Interest rate risk: Bond prices may fall if interest rates rise.
Credit risk: Corporate bond ETFs may be affected by issuer downgrades or defaults.
Liquidity risk: Some ETFs may experience wider bid-ask spreads during market stress.
Currency risk: For ETFs with foreign exposure (e.g., USD or RMB bonds), exchange rate fluctuations can impact returns.
Are distributions from Singapore bond ETFs taxable?
No, distributions from Singapore-listed bond ETFs are not taxable for individual investors. Singapore operates a one-tier corporate tax system, meaning dividends and interest distributions are paid out of already-taxed income and are exempt from further taxation in the hands of shareholders — both local and foreign.
When is the best time to trade Singapore bond ETFs?
The best time to trade is during SGX market hours (9:00 AM to 5:00 PM SGT) when liquidity is highest.
Footnotes:
1 Growbeansprout.com, "Top Singapore Bond ETFs: How to Choose the Best One for Your Portfolio", May 2025
2 MAS.gov.sg, "Understanding Singapore's Bond Market", 2025
3 StashAway.sg, "Best Bond ETFs in Singapore and Overseas for Your Portfolio", May 2025
4 StashAway.sg, "Best Bond ETFs in Singapore and Overseas for Your Portfolio", May 2025
5 StashAway.sg, "Best Bond ETFs in Singapore and Overseas for Your Portfolio", May 2025
6 StashAway.sg, "Best Bond ETFs in Singapore and Overseas for Your Portfolio", May 2025
7 Growbeansprout.com, "Top Singapore Bond ETFs: How to Choose the Best One for Your Portfolio", May 2025
8 StashAway.sg, "Best Bond ETFs in Singapore and Overseas for Your Portfolio", May 2025
9 Growbeansprout.com, "Top Singapore Bond ETFs: How to Choose the Best One for Your Portfolio", May 2025
10 TheInvestQuest.com, "SGX-listed Bond ETFs: Which are good enough for our readers?", April 2021
11 StashAway.sg, "Best Bond ETFs in Singapore and Overseas for Your Portfolio", May 2025
12 Growbeansprout.com, "Interest Rates Are Falling. Time to Look at Singapore Bond ETFs?", May 2025
13 Growbeansprout.com, "Top Singapore Bond ETFs: How to Choose the Best One for Your Portfolio", May 2025
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