FSM Global Recommended Funds List 2026/27: Our top choices for Bond and Balanced Funds!

We are celebrating the 26th anniversary of our Recommended Funds list this year! First published in 2001, the list was created to help investors make more informed investment decisions and has continued to evolve alongside markets and our fund-selection framework.

This year’s list features 45 Recommended Funds, all of which are best-in-class within their respective categories, each selected through our rigorous quantitative and qualitative assessment process. This article will focus on our recommended Bond Funds and Balanced Funds. For our recommended equity funds, check out the article below!

FSM Global Recommended Funds List 2026/27: Discover the Best-In-Class Equity Funds

Our Bond & Balanced Recommendations

Tables 1 and 2 show our latest 14 Bond Fund and 2 Balanced Fund recommendations for 2026/27.

Fixed income markets generally did well over the past year. High starting yields provided attractive carry, while strong investor demand for yield drove credit spreads tighter, further supporting returns across most bond segments.

Looking ahead, however, the interest-rate outlook remains uncertain. The market narrative has shifted from the pace of Fed cuts toward the prospect of renewed rate hikes, as the Middle East conflict complicates the inflation outlook. At the longer end of the curve, 30-year government bond yields across major markets have also risen amid concerns over inflation and fiscal sustainability. Meanwhile, broader macroeconomic uncertainties increase the risk that already-tight credit spreads widen.

Against this backdrop, fund selection matters. We favour managers that can balance attractive carry against duration and credit risks, while remaining nimble enough to reposition their portfolios as market conditions change. Our Recommended Funds are all managed by experienced investment teams with established track records across different market environments.

Table 1: Recommended Bond Funds

Table 2: Recommended Balanced Funds

Notable changes

Many of our recommendations remain unchanged this year, with last year’s picks generally holding up well amid market volatility. We have made just two changes this year, within the Global Bonds and Emerging Market Bonds categories. Read on for more details!

1. Global Bonds

For 2026/27, our two Global Bond Fund recommendations are PIMCO Income Fund and BlackRock Fixed Income Global Opportunities Fund.

PIMCO Income Fund is one of the world’s largest actively managed bond funds. It is highly diversified across more than 7,000 holdings as of 31 July 2026, spanning sovereigns, securitised credit, bank loans, and corporate bonds, while maintaining a sizeable allocation to agency MBS. Its broad mandate gives its managers access to virtually all corners of the global bond market and allows for significant flexibility to shift portfolio exposures as relative value changes with market movements.

BlackRock Fixed Income Global Opportunities is our latest addition to our Recommended Funds List this year. Similar to the PIMCO Fund, it invests across the global bond universe, with flexibility across geographies and currencies, duration and the yield curve, as well as security selection. Its latest portfolio (as of 31 July 2026) has sizeable allocations to securitised assets and sovereigns (Table 3).

We view both PIMCO and BlackRock funds as strong considerations (Chart 1). Both PIMCO Income Fund and BlackRock Fixed Income Global Opportunities currently maintain meaningful exposure to securitised assets, although their portfolio construction and duration positioning differ considerably. PIMCO Income Fund has a longer effective duration of 6.7 years, compared with 3.3 years for BlackRock Fixed Income Global Opportunities. This gives the PIMCO fund greater interest-rate sensitivity, while the BlackRock fund’s shorter duration provides a relatively defensive duration stance.

Both funds have demonstrated their ability to navigate global bond markets. The PIMCO fund offers an indicative distribution yield of over 6%, compared with around 5.0% for the BlackRock fund. Both funds are available for investment via Cash and SRS.

Table 3: Portfolio exposures for BlackRock Fixed Income Global Opportunities Fund

Chart 1: Peer comparison for Global Bonds

Related article: Seeking diversified bond returns with BlackRock Fixed Income Global Opportunities

Related article: Idea Of The Week: PIMCO Income Fund's 6% Distribution Yield — Income Sources and Trade-off

2. Global Emerging Markets Bonds

Our newest pick within this space is the Neuberger Short Duration Emerging Markets Debt Fund! This fund seeks to generate stable income with limited volatility through a diversified portfolio of hard-currency sovereign and corporate credits. Its short-duration approach aims to capture EM spread carry while limiting interest rate risk.

The investment team combines top-down country credit analysis with bottom-up fundamental research. Duration is targeted at two years, with a range of ±0.75 years, while high-yield exposure is capped at 50% (currently 47.7% of the portfolio as of 31 July 2026).

Downside protection is also central to the team’s credit-selection process. Each issuer is assessed using a proprietary credit-rating and probability-of-default model designed to identify deteriorating fundamentals before these are reflected in ratings or market prices. Corporate issuers are also subject to a liquidity stress test, where a haircut is applied to cash flows to assess their ability to meet near-term obligations under stressed conditions. This approach has allowed the team to identify opportunities in recovering credits that other investors may avoid. Argentina and Sri Lanka, for example, were among the fund’s strongest contributors to recent performance.

The portfolio diversifies its exposure across borrower types (Chart 2), with corporates at 42.3%, sovereigns at 27.9% and quasi-sovereigns at 19.4% as of 31 July 2026, alongside smaller supranational and sub-sovereign sleeves and 6.1% cash. Geographically, the portfolio leans towards the Gulf, with Saudi Arabia (8.8%) and the UAE (7.9%) as its two largest country exposures.

The fund has delivered stronger risk-adjusted outcomes than peers. Its 5-year maximum drawdown was around 10.6%, less than half the peer average of 23.8%. Furthermore, annualised volatility was also materially lower at 4.4% versus the peer average of 7.0%. This downside management has allowed it to deliver a better 5-year annualised return versus peers (Chart 3).

On balance, we think Neuberger Short Duration Emerging Markets Debt Fund offers an attractive way to access EM income without taking on the full duration risks associated with traditional EM bond strategies. Its historically lower volatility and drawdowns also strengthen its appeal for investors seeking a more defensive approach to Emerging Market debt. The fund can be invested via Cash and SRS.

Related article: Neuberger Berman Short Duration Emerging Market Debt Fund – Low IG volatility for EM exposure

Chart 2: Underlying exposures of Neuberger Berman fund by issuer type

Chart 3: Peer comparison for Emerging Market Bonds

3. Short Duration Bonds – new category name, same fund picks

We have renamed our Singapore-Centric Bonds category to Short Duration Bonds this year. This reflects our shift in how we serve investors – not only for Singapore investors, but for investors worldwide wherever they are. With that in mind, the category now focuses on short-duration bond funds, which provide relatively defensive fixed income exposure with lower interest-rate sensitivity.

Our recommendations remain unchanged: Amova Short Term Bond SGD and United SGD Fund continue to stand out in the short-duration space, supported by their superior risk-adjusted returns.

4. Enhanced Liquidity Solutions - unchanged

Our picks remain unchanged this year: iFAST SGD Enhanced Liquidity Fund and iFAST USD Enhanced Liquidity Fund.

With ongoing uncertainty around interest rates, investors continue to seek ways to enhance cash-like yields without taking on substantial duration risk. The two iFAST Enhanced Liquidity Funds help by investing in conservative portfolios that have had minimal drawdowns since inception (Chart 4). Both funds also offer quick settlement (within a day), making them among the most liquid options for investors who value flexibility and ready access to their cash.

Looking ahead, the fund team will continue to prioritise capital preservation and liquidity. The funds both primarily invest in high-quality fixed income instruments, including fixed deposits, sovereign and corporate bonds, as well as units trusts such as money market and short-duration bond funds.

Related article: Cash now, cash later: Choosing the right cash-management solution

Chart 4: Both iFAST Enhanced Liquidity Funds have had minimal drawdowns since inception

5. Balanced Funds - unchanged

PineBridge Acorns of Asia Balanced Fund is our pick again for Asia Balanced Funds. The fund invests in Asia small-mid cap equities alongside a more defensive allocation to Singapore fixed income securities, in a roughly 60/40 strategic allocation. While several peers have delivered stronger longer-term returns, PineBridge's recent performance has improved. Its competitive fees and availability through Cash, SRS, CPF-OA and CPF-SA remain key strengths.

Schroder Multi-Asset Revolution Fund is our pick for Global Balanced Funds, unchanged from last year. The strategy takes an actively managed global multi-asset approach, adjusting allocations across equities, bonds and other asset classes as market conditions change. Schroder's long track record and global diversification continue to support its place on our Recommended Funds List.

Final thoughts

Many of our Bond and Balanced Fund recommendations have not changed this year, reflecting the continued strength of our existing selections. The new additions, in our view, strengthen the list by offering differentiated approaches to duration and credit risk in today’s uncertain market environment.

More broadly, our Recommended Funds span a wide range of risk profiles, from lower-risk Money Market Funds to Global, Emerging Market, and High Yield Bond strategies, as well as diversified Balanced Funds. With the right fund selection, investors can build portfolios that are well-positioned to navigate market uncertainty, and ultimately invest globally and profitably.

For more information on our Recommended Funds, you may check out our full report here!

Declaration: For specific disclosure, at the time of publication of this report, IFPL (via its connected and associated entities) and the analyst who produced this report hold NIL positions in the abovementioned securities. This research report was prepared with the assistance of artificial intelligence (AI) tools. iFAST Financial Pte Ltd does not rely exclusively on AI for content generation; the content of this report – including all investment theses, ratings, price targets and conclusions – has been independently reviewed and verified by the research analyst(s) to ensure accuracy and professional integrity.