Introduction
Unit trusts are one of the most common investment vehicles available to retail investors in Singapore. A unit trust pools money from many investors and invests the combined capital in a diversified portfolio of assets such as equities, bonds, or multi-asset strategies.
According to MoneySense Singapore, a national financial education initiative supported by the Monetary Authority of Singapore (MAS), investors in a fund “pool their money with other investors and the fund manager invests it according to the fund’s objective.” Unit trusts offered to retail investors are regulated as collective investment schemes, providing oversight on disclosure, structure, and investor protection.
This guide explains the best ways to invest in unit trusts in Singapore in 2026, how each method works, and which approach may suit different investor profiles. It also highlights typical fees, minimum investments, and regulatory considerations so readers can make informed decisions.
Before investing, investors should review the Product Highlights Sheet (PHS) and official prospectus for each fund and confirm current fees and eligibility requirements.
Quick Summary
Key facts about investing in unit trusts:
- Unit trusts pool investor money into professionally managed portfolios.
- Retail funds offered in Singapore are regulated collective investment schemes.
- Investors can access equity, bond, balanced, and income strategies.
- Typical recurring fees for actively managed funds often range between 1.0% and 2.0% annually, while passive funds generally charge below 1% per year according to MoneySense data as of 2025.
- Unit trusts are not capital guaranteed, and investors can lose part or all of the money invested.
- Investors may access funds through banks, investment platforms, or retirement schemes such as CPFIS or SRS.
Comparison of the Best Ways to Invest in Unit Trusts
| Method | Category Type | How It Works | Typical Minimum | Typical Fees | Best For |
| Bank investment platforms | Distribution channel | Investors buy funds through bank platforms or relationship managers | Around SGD 1,000 lump sum depending on provider | Sales charge plus annual fund fees | Investors seeking research tools and guidance |
| Regular Savings Plan (RSP) | Contribution method | Automatic monthly investment into selected funds | From around SGD 100 per month with some banks | Fund expense ratio plus possible platform fee | Beginners building long term discipline |
| Lump sum investing | Contribution method | One time capital deployment into a fund | Fund specific minimums | Sales charge plus annual fund fees | Investors with available cash |
| CPFIS or SRS investing | Funding wrapper | Retirement savings used to purchase approved funds | Subject to CPFIS or SRS rules | Fund fees plus possible platform charges | Retirement focused investors |
| Digital advisory platforms | Distribution channel | Automated portfolios built using funds or ETFs | Often lower entry thresholds | Advisory fee plus fund expense ratio | Hands off investors |
Last verified: March 2026. Minimums and fees vary by provider and fund.
The 5 Best Ways to Invest in Unit Trusts
1. Bank Investment Platforms
Many Singapore investors access unit trusts through major bank platforms. Banks provide access to a wide selection of funds from multiple asset managers.
Examples include investment platforms offered by major local banks that allow investors to research funds, track performance, and execute transactions online or through a relationship manager.
Typical characteristics
- Access through online banking or investment platforms
- Large fund selection across asset classes
- Optional advisory support from relationship managers
Advantages
- Centralised portfolio tracking
- Access to research reports and tools
- Broad fund selection
Trade offs
- Sales charges may apply depending on the fund
- Platform costs can be higher than direct online platforms
Bank investment platforms are often suitable for investors who want structured guidance and integrated portfolio tracking.
2. Regular Savings Plans (RSP)
A Regular Savings Plan allows investors to contribute a fixed amount every month into a selected unit trust.
Many Singapore providers offer RSP programmes with minimum monthly contributions starting around SGD 100, although the exact minimum depends on the platform and fund eligibility rules.
RSP investing follows the principle of dollar cost averaging, where investors buy more units when prices are lower and fewer when prices are higher.
Research from Vanguard indicates that dollar cost averaging can reduce the risk of poor market timing, although lump sum investing may generate higher returns in rising markets.
Advantages
- Lower starting capital required
- Encourages long term investing discipline
- Reduces the risk of investing at a market peak
Trade offs
- Gains may be slower during strong bull markets
- Limited fund selection compared with lump sum investing
RSPs are commonly used by new investors building long term portfolios with steady monthly contributions.
3. Lump Sum Investing
Lump sum investing involves investing a larger amount of capital at one time rather than gradually over several months.
Investors often use lump sum investing when deploying bonuses, windfalls, or accumulated savings.
Typical features
- Immediate full market exposure
- Access to the entire fund universe available on the platform
- Fund specific minimum investment thresholds
Advantages
- Immediate participation in market growth
- Simpler investment structure
- Potentially higher long term returns if markets rise
Trade offs
- Higher short term volatility exposure
- Greater risk of investing just before a market decline
Academic research from financial institutions has found that lump sum investing historically outperformed phased investing in rising markets, although it carries higher timing risk.
4. CPFIS and SRS Linked Unit Trust Investments
Singapore investors may also invest in selected unit trusts using retirement schemes such as the CPF Investment Scheme (CPFIS) or the Supplementary Retirement Scheme (SRS).
Under CPFIS, CPF members can invest part of their savings in eligible investment products including unit trusts.
SRS provides additional tax advantages for retirement investing.
According to the Inland Revenue Authority of Singapore (IRAS):
- SRS contributions are eligible for tax relief in the year of contribution
- Investment returns within the SRS account are tax free before withdrawal
- Only 50 percent of qualifying withdrawals after retirement are taxable
However, early withdrawals may trigger a 5 percent penalty and full taxation.
Advantages
- Encourages long term retirement investing
- Potential tax benefits under SRS
- Access to professionally managed funds
Trade offs
- Investment options restricted to approved funds
- Withdrawal restrictions apply
This approach is commonly used by investors focused on long term retirement accumulation.
5. Digital Advisory Platforms
Digital advisory platforms provide automated investment portfolios that may include unit trusts, ETFs, or other funds depending on the provider.
Some platforms construct portfolios primarily using unit trusts, while others combine ETFs and funds.
Investors typically complete a risk profiling questionnaire, after which the platform recommends a diversified portfolio.
Typical characteristics
- Automated portfolio construction
- Automatic rebalancing
- Lower minimum investment thresholds
Advantages
- Simplified investment process
- Professional portfolio allocation
- Automatic rebalancing over time
Trade offs
- Advisory fees layered on top of fund fees
- Less control over individual fund selection
Digital advisory platforms are often preferred by hands off investors seeking automated portfolio management.
How to Choose the Right Unit Trust
1. Define Your Investment Horizon
Investment time horizon influences suitable fund types.
General guidelines include:
- Under 3 years: lower volatility bond or money market funds
- 3 to 5 years: balanced or multi asset funds
- 5 years or longer: equity oriented funds
Historically, global equities have produced positive long term returns over multi decade periods, although short term volatility can be significant.
2. Review the Fee Structure
Unit trusts may include several types of fees:
- Management fee
- Trustee or administrative fee
- Sales charge or front end fee
- Redemption fee in some cases
According to MoneySense data as of 2025, active funds commonly charge between 1 percent and 2 percent annually, while passive funds typically charge below 1 percent.
Even small fee differences can significantly affect long term returns due to compounding.
3. Understand the Fund Mandate
Before investing, review key fund details:
- Investment objective
- Benchmark index
- Geographic exposure
- Sector allocation
- Top holdings
These details help determine whether the fund aligns with an investor’s investment strategy.
4. Assess Risk Tolerance
Unit trusts vary widely in risk level.
Common categories include:
- Money market funds
- Bond funds
- Balanced funds
- Regional or global equity funds
- Sector or thematic funds
Higher expected returns usually come with higher volatility.
5. Confirm Regulatory Status
In Singapore, retail investment funds must comply with regulatory requirements.
Investors should verify that:
- The fund is authorised or recognised for retail distribution
- The distributor is licensed
- Disclosure documents are available
Regulation improves transparency but does not eliminate market risk.
Best Methods for Different Investor Profiles
Best for beginners
Regular Savings Plans with smaller monthly contributions.
Best for retirement investing
CPFIS or SRS funded unit trust investments.
Best for passive investors
Digital advisory platforms offering automated portfolios.
Best for experienced investors
Bank investment platforms with wider fund selection.
Best for deploying bonuses or windfalls
Lump sum investing in diversified funds.
Frequently Asked Questions
What is the minimum investment for unit trusts in Singapore?
Minimum investments vary by platform and fund. Lump sum investments may start around SGD 1,000, while some Regular Savings Plans allow contributions from about SGD 100 per month depending on the provider.
Are unit trusts guaranteed?
No. Unit trusts are not principal or capital guaranteed, and investors may lose part or all of their investment depending on market performance.
How long should I stay invested in unit trusts?
Equity focused funds are generally more suitable for investors with a medium to long term investment horizon, often five years or more.
How are unit trusts different from ETFs?
Unit trusts are typically purchased through distributors such as banks or platforms and are often actively managed.
Exchange Traded Funds (ETFs) trade on stock exchanges like shares and frequently track market indices.
Conclusion
Unit trusts provide retail investors with access to diversified portfolios managed by professional fund managers. In Singapore, investors can access these funds through several channels including bank platforms, Regular Savings Plans, lump sum investments, CPFIS or SRS retirement accounts, and digital advisory platforms.
Each approach has different advantages depending on the investor’s capital, time horizon, and involvement level. Regular Savings Plans may suit beginners building investment discipline, while lump sum investing and bank platforms may appeal to experienced investors with larger capital.
Before investing, investors should carefully review the Product Highlights Sheet, fund prospectus, platform fees, and eligibility requirements. Regulations provide oversight, but investment outcomes ultimately depend on market performance, fees, and investment strategy.
