Acceleration clause

Table of Contents

Acceleration clause
What is an acceleration clause?
Understanding acceleration clause
Acceleration clause explained
Purpose of acceleration clause
Example of acceleration clause
Frequently Asked Questions

Acceleration clause

In loan agreements and other types of debt agreements, an acceleration clause is a crucial feature. This clause gives lenders the authority to demand prompt repayment of the entire outstanding balance of a loan if specific conditions aren’t met, which can substantially influence both lenders and borrowers. The acceleration clause is intended to safeguard lenders from the possibility of default and guarantee prompt loan repayment.

What is an acceleration clause?

The term “acceleration clause” refers to a clause in a loan or debt arrangement that permits the lender or creditor to demand prompt repayment of the entire outstanding balance of the debt if specific circumstances are met, such as default or non-payment by the borrower. The clause gives the lender or creditor the right to accelerate the payment schedule rather than waiting for payments to be made over time. This can be a powerful tool for lenders, allowing them to protect their investments and limit their risk exposure.

Understanding acceleration clause

Suppose the borrower doesn’t adhere to the terms of the loan agreement. In that case, an acceleration clause in the loan agreement enables the lender or creditor to demand immediate payment of the loan’s outstanding balance.

For lenders or creditors, the acceleration clause is a potent instrument since it enables them to safeguard their investments and reduce their risk exposure in the event of borrower default. However, if borrowers cannot meet the accelerated payment schedule, it could result in the loss of assets or property, which could cause concern.

When a lender uses an acceleration clause, the borrower must pay any accrued interest and the remaining principal balance of the loan that has not yet been paid. The entire interest amount that might have been required had the loan been repaid according to regular terms needs to be paid in full by the borrower. To avoid paying interest for the remaining portion of the loan’s term, most loans, for instance, permit the borrower to accelerate the loan and pay it off early in one lump amount.

Acceleration clause explained

An acceleration clause is significant because it can shield creditors or lenders against the possibility of default or non-payment by the borrower. The lender or creditor can demand immediate repayment of the remaining balance of the loan or debt in the event of default by incorporating an acceleration provision in the loan or debt agreement. By doing this, they can reduce their losses and risk exposure.

The acceleration clause can also ensure that the lender or creditor receives payment immediately rather than waiting for instalments to be made over a lengthy period. This can help to ensure the financial stability of the lender or creditor, as well as the borrower, by helping to prevent situations where the borrower cannot meet their payment obligations.

Although the quantity of past-due payments might change, an acceleration clause is often based on them. One missed payment may trigger an instant payback under some acceleration conditions, while two or three failed payments under others may be permitted before the loan must be repaid in full. An acceleration clause may also be affected by the sale or transfer of the property to a third party.

Purpose of acceleration clause

An acceleration clause allows lenders or creditors to protect their investments in case of default or non-payment by the borrower. It allows the lender or creditor to demand immediate repayment of the outstanding balance of the debt, which can help to limit their risk exposure and minimise their losses.

By accelerating the payment schedule, the lender or creditor can also ensure that they are repaid promptly rather than waiting for payments to be made over an extended period. The acceleration clause is often included in loan or debt agreements to protect lenders or creditors and help ensure they can recover their investments in default or non-payment.

Example of acceleration clause

The acceleration clause notion can be better understood by looking at the examples below. If the borrower doesn’t make payments for a predetermined period, the mortgage may contain an acceleration clause that enables the lender to demand full repayment of the debt. Similarly, if an issuer defaults on its obligations, a bond deal may contain an acceleration clause that enables the bondholder to request immediate repayment of the principal and interest. Due to the acceleration clause, the lender or bondholder can request immediate repayment of the loan rather than waiting for instalment payments to be completed.

Frequently Asked Questions

What are the common contracts with acceleration clauses?

The most common contracts that include acceleration clauses are loan agreements, bond agreements, and other debt agreements. These contracts are typically used in business and finance to protect lenders or creditors against borrower default.

What triggers an acceleration clause in a loan agreement?

The specific triggers for an acceleration clause in a loan agreement can vary depending on the terms of the agreement. However, common triggers may include default on loan payments, breach of contract, bankruptcy, or a change in ownership or control of the borrower’s business.

What are the differences between an acceleration and demand clause?

An acceleration clause allows the lender or creditor to demand immediate repayment of the entire outstanding balance of a loan if certain conditions are not met. A demand clause, on the other hand, allows the lender or creditor to demand repayment of the outstanding balance of a loan at any time without the need for specific triggers or conditions.

What are the differences between an acceleration and an alienation clause?

An acceleration clause allows the lender or creditor to demand immediate repayment of the entire outstanding balance of a loan if certain conditions are not met. On the other hand, an alienation clause restricts the borrower’s ability to transfer ownership or sell the asset securing the loan without the lender’s permission.

What is the difference between the due on the sale clause and the acceleration clause?

A due-on-sale clause requires the borrower to pay off the loan’s outstanding balance when the underlying property is sold or transferred to a new owner. An acceleration clause allows the lender to demand immediate repayment of the loan’s outstanding balance if certain conditions are not met, regardless of any sale or transfer of the underlying property.

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Zixin Group Holdings Delivers Strong Growth on Volume Surge, BUY Rating with S$0.06 Target Price

Published on Jun 18, 2026 19

Company Overview Zixin Group Holdings Ltd operates as a Chinese agricultural company specialising in fresh sweet potatoes and processed sweet potato products. The company serves both domestic Chinese markets and international customers through its dual-segment business model, combining fresh produce distribution with value-added processing operations. Strong Financial Performance Exceeds Expectations Zixin Group Holdings delivered impressive 2H26 results that surpassed analyst forecasts, with revenue climbing 44.3% year-on-year to RMB386.8 million and net income rising 29.9% to RMB45.4 million. The strong performance was driven by higher sales volumes across both business segments, with full-year revenue and profit after tax and minority interests reaching 104% and 123% of forecasts respectively. Fresh Sweet Potato Segment Powers Growth The fresh sweet potato segment emerged as a standout performer, with earnings nearly doubling due to approximately 30% year-on-year growth in sales volume. This robust performance was underpinned by the company's smart warehouse infrastructure, which extends shelf life and reduces spoilage, enabling a higher percentage of inventory to flow into revenue-generating sales channels. Despite expectations of margin pressure from rising production costs such as fertiliser, Zixin anticipates that volume growth will offset these headwinds and maintainthe current net margin of approximately 21.5% for the cultivation and supply segment. The company projects 60% year-on-year revenue growth for this segment in FY27, supported by expanded sales channels within China and deeper international market penetration. Processed Products Segment Shows Steady Expansion The processed products division also demonstrated strong momentum, with earnings increasing 12.5% year-on-year. Growth was fuelled by higher sales volumes and portfolio expansion, particularly the introduction of additive-free, vacuum-packed steamed sweet potatoes launched in FY25, complementing existing sweet potato crisps and fries. Sales of processed chips and steamed sweet potato products surged 71% year-on-year, establishing these products as the segment's primary growth engines. Management expects 30% year-on-year growth for FY27, driven by enhanced production of high-margin premium products and an expanding white-label customer base. Investment Recommendation Phillip Securities Research maintains its BUY recommendation whilst raising the target price to S$0.06. The firm has increased FY27 revenue and net profit forecasts by 23% and 29% respectively, expecting 24% year-on-year earnings growth driven by continued expansion of Zixin's white-label ODM business and sustained demand for premium sweet potato varieties. Frequently Asked Questions [market_journal_faq] This article has been auto-generated using PhillipGPT. It is based on a report by a Phillip Securities Research analyst. Disclaimer These commentaries are intended for general circulation and do not have regard to the specific investment objectives, financial situation and particular needs of any person. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of any person acting based on this information. You should seek advice from a financial adviser regarding the suitability of any investment product(s) mentioned herein, taking into account your specific investment objectives, financial situation or particular needs, before making a commitment to invest in such products. Opinions expressed in these commentaries are subject to change without notice. Investments are subject to investment risks including the possible loss of the principal amount invested. The value of units in any fund and the income from them may fall as well as rise. Past performance figures as well as any projection or forecast used in these commentaries are not necessarily indicative of future or likely performance. Phillip Securities Pte Ltd (PSPL), its directors, connected persons or employees may from time to time have an interest in the financial instruments mentioned in these commentaries. The information contained in these commentaries has been obtained from public sources which PSPL has no reason to believe are unreliable and any analysis, forecasts, projections, expectations and opinions (collectively the “Research”) contained in these commentaries are based on such information and are expressions of belief only. PSPL has not verified this information and no representation or warranty, express or implied, is made that such information or Research is accurate, complete or verified or should be relied upon as such. Any such information or Research contained in these commentaries are subject to change, and PSPL shall not have any responsibility to maintain the information or Research made available or to supply any corrections, updates or releases in connection therewith. In no event will PSPL be liable for any special, indirect, incidental or consequential damages which may be incurred from the use of the information or Research made available, even if it has been advised of the possibility of such damages. The companies and their employees mentioned in these commentaries cannot be held liable for any errors, inaccuracies and/or omissions howsoever caused. Any opinion or advice herein is made on a general basis and is subject to change without notice. The information provided in these commentaries may contain optimistic statements regarding future events or future financial performance of countries, markets or companies. You must make your own financial assessment of the relevance, accuracy and adequacy of the information provided in these commentaries. Views and any strategies described in these commentaries may not be suitable for all investors. 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Adobe Inc Maintains Strong Freemium Growth Despite ARR Deceleration, BUY Rating with US$385 Target Price

Published on Jun 18, 2026 8

Company Overview Adobe Inc is a leading software company providing creative, marketing, and document management solutions to professionals and consumers worldwide. The company operates through its flagship Creative Cloud platform, offering tools like Photoshop, Premiere, and Lightroom, alongside productivity solutions such as Acrobat for PDF management. Strong Performance Driven by Creative Cloud Pro Adobe's second quarter 2026 results met expectations, with revenue and adjusted profit after tax and minority interest reaching 50% and 51% of full-year forecasts respectively. The company's performance was primarily driven by the Adobe Creative Cloud Pro offering, which has gained significant traction amongst creative professionals. The freemium strategy continues to show remarkable results, with Creative freemium monthly active users surging 70% year-on-year to exceed 90 million users. This represents an acceleration from the 50% growth recorded in the first quarter. The user base expansion spans across web and mobile platforms, encompassing Firefly, Express, Premiere, Photoshop, and Lightroom applications. Document Workflow Expansion Shows Promise Adobe's productivity suite demonstrated robust growth, with business professionals and consumers increasing 16% year-on-year. Acrobat and Express experienced particularly strong adoption, with monthly active users rising 20% annually. The integration of artificial intelligence capabilities has significantly enhanced performance, with annual recurring revenue in this segment tripling compared to the previous year. ARR Growth Challenges Persist Despite strong user engagement, Adobe faces ongoing challenges with annual recurring revenue growth. Excluding the US$480 million contribution from Semrush, Adobe's ARR reached US$26.6 billion, representing 10.5% year-on-year growth. This marks the tenth consecutive quarter of organic ARR deceleration, reflecting management's continued emphasis on user acquisition over immediate monetisation. Investment Outlook Phillip Securities Research maintains a BUY recommendation on Adobe with an increased target price of US$385, up from the previous US$368. The company trades at an attractive valuation of 11.5 times FY26 estimated GAAP price-to-earnings ratio, below its one-year average of 18 times. Despite competitive pressures from generative AI, Adobe's commercially safe intellectual property, enterprise demand for comprehensive tools, and Firefly's integration capabilities support a resilient outlook. Frequently Asked Questions [market_journal_faq] This article has been auto-generated using PhillipGPT. It is based on a report by a Phillip Securities Research analyst. Disclaimer These commentaries are intended for general circulation and do not have regard to the specific investment objectives, financial situation and particular needs of any person. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of any person acting based on this information. You should seek advice from a financial adviser regarding the suitability of any investment product(s) mentioned herein, taking into account your specific investment objectives, financial situation or particular needs, before making a commitment to invest in such products. Opinions expressed in these commentaries are subject to change without notice. Investments are subject to investment risks including the possible loss of the principal amount invested. The value of units in any fund and the income from them may fall as well as rise. Past performance figures as well as any projection or forecast used in these commentaries are not necessarily indicative of future or likely performance. Phillip Securities Pte Ltd (PSPL), its directors, connected persons or employees may from time to time have an interest in the financial instruments mentioned in these commentaries. The information contained in these commentaries has been obtained from public sources which PSPL has no reason to believe are unreliable and any analysis, forecasts, projections, expectations and opinions (collectively the “Research”) contained in these commentaries are based on such information and are expressions of belief only. PSPL has not verified this information and no representation or warranty, express or implied, is made that such information or Research is accurate, complete or verified or should be relied upon as such. 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Oracle Corporation Accelerates Cloud Growth with Massive US$70bn CAPEX Investment, Target Price US$237 with BUY Rating

Published on Jun 18, 2026 13

Company Overview Oracle Corporation operates as a leading enterprise software and cloud infrastructure provider, offering an integrated technology stack spanning from database management systems to comprehensive cloud services. The company has positioned itself as a critical player in the enterprise cloud market, delivering end-to-end solutions that combine infrastructure and cloud services for large-scale business operations. Strong Financial Performance Drives Optimistic Outlook Oracle delivered robust fourth-quarter FY26 results, with revenue meeting expectations whilst profit after tax and minority interests (PATMI) exceeded forecasts. Full-year FY26 performance was equally impressive, with revenue and PATMI reaching 101% and 115% of analyst projections respectively. The company achieved remarkable 21% year-on-year revenue growth in the fourth quarter, primarily driven by Oracle Cloud revenue surging 47% compared to the previous year. Unprecedented Revenue Visibility and Growth Acceleration Oracle has established exceptional revenue visibility through its Remaining Performance Obligations (RPO), which rose an extraordinary 4.6 times to reach US$638 billion. This massive backlog underpins Oracle's confidence in accelerating revenue growth to 34% year-on-year in FY27, a significant jump from FY26's 16% growth rate. The Cloud Infrastructure business represents the primary growth engine, with revenue projections showing a remarkable 109% surge. Oracle's infrastructure expansion is gaining substantial momentum, with first-quarter FY27 additions approaching 1 gigawatt of capacity, nearly matching FY26's entire annual addition of 1.2 gigawatts. Strategic Partnerships and Infrastructure Expansion Oracle has secured transformative partnerships, most notably OpenAI's five-year US$300 billion Oracle Cloud Infrastructure commitment beginning in 2027. This partnership is expected to receive additional support from OpenAI's anticipated initial public offering, which could provide capital for fulfilling FY27 obligations. The company's ambitious infrastructure expansion includes five major Stargate sites. The flagship Abilene, Texas campus is 42% complete and targeted to deliver 1.2 gigawatts by end-2026. Four additional sites across Texas, New Mexico, Michigan, and Wisconsin are under construction, with deliveries commencing in 2027. This expansion is expected to scale total capacity to 7 gigawatts, progressing towards Oracle's ultimate 10 gigawatt target. Investment Recommendation and Valuation Phillip Securities Research maintains a BUY rating with a revised discounted cash flow target price of US$237, reduced from the previous US$275. This adjustment reflects increased FY27e capital expenditure guidance of US$70 billion, net of US$20 to US$25 billion in customer prepayments, and is substantially higher than initial estimates of US$47 billion. The weighted average cost of capital and growth assumptions remain unchanged. The substantial US$75 billion in bookings under the new funding model over two quarters, representing 12% of RPO, demonstrates strong customer preference for Oracle's comprehensive technology stack despite prepayment requirements and bring-your-own-hardware conditions. Frequently Asked Questions [market_journal_faq] This article has been auto-generated using PhillipGPT. It is based on a report by a Phillip Securities Research analyst. Disclaimer These commentaries are intended for general circulation and do not have regard to the specific investment objectives, financial situation and particular needs of any person. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of any person acting based on this information. You should seek advice from a financial adviser regarding the suitability of any investment product(s) mentioned herein, taking into account your specific investment objectives, financial situation or particular needs, before making a commitment to invest in such products. Opinions expressed in these commentaries are subject to change without notice. Investments are subject to investment risks including the possible loss of the principal amount invested. The value of units in any fund and the income from them may fall as well as rise. Past performance figures as well as any projection or forecast used in these commentaries are not necessarily indicative of future or likely performance. 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Apple Inc. Gains AI Strategy Clarity with Enhanced Siri and Intelligence Expansion, NEUTRAL Rating Maintained at US$290 Target Price

Published on Jun 18, 2026 5

Company Overview Apple Inc. operates as a leading technology company that designs, manufactures, and market consumer electronics, computer software, and online services globally. The company's ecosystem approach integrates hardware, software, and services across devices including iPhones, iPads, Macs, and Apple Watches, creating a comprehensive digital experience for users. WWDC Unveils Comprehensive AI Strategy Apple held its annual Worldwide Developers Conference on 8 June, providing greater visibility into its artificial intelligence strategy through significant updates to Apple Intelligence and Siri. The conference demonstrated Apple's approach to integrating AI capabilities across its ecosystem whilst maintaining its privacy-first philosophy. Enhanced Siri and Apple Intelligence Features The centrepiece of Apple's AI advancement is Siri AI, a next-generation version powered by Apple Intelligence. This enhanced assistant represents a fundamental shift from traditional command-based voice interaction towards a more capable, proactive AI-powered digital assistant. Key improvements include personal context understanding, on-screen awareness, visual intelligence, and enhanced conversational capabilities that enable better comprehension of user intent and execution of complex tasks across applications. Apple Intelligence expansion extends throughout the ecosystem with new capabilities including AI-powered tab organisation and page monitoring in Safari, natural-language event creation in Calendar, context-aware suggestions in Messages, and AI-assisted automation through Shortcuts. The system also features enhanced image generation and photo editing tools, combining personal context, world knowledge, and on-screen awareness to deliver personalised experiences. Privacy-First Approach and Ecosystem Integration Apple emphasised its privacy-centric AI strategy, highlighting on-device AI inference whenever possible whilst utilising Private Cloud Compute only when additional processing power is required. Notably, Apple Intelligence is positioned as a system-wide capability integrated across the installed base, rather than a standalone subscription service. Investment Outlook and Recommendation Phillip Securities Research maintains a NEUTRAL recommendation with an increased DCF target price of US$290, up from US$280 previously. The firm raised its FY26 revenue and PATMI assumptions by 2% and 1% respectively, accounting for continued iPhone 17 growth. The beta assumption was lowered from 1.00 times to 0.95 times, reflecting increased confidence in Apple's long-term competitive positioning and ecosystem durability. The updates strengthen Apple's ecosystem advantage, potentially driving more robust upgrade cycles and improved services revenue whilst requiring modest capital expenditure compared to hyperscalers. However, successful execution and broader user adoption remain critical for translating these developments into sustained earnings growth. Frequently Asked Questions [market_journal_faq] This article has been auto-generated using PhillipGPT. It is based on a report by a Phillip Securities Research analyst. Disclaimer These commentaries are intended for general circulation and do not have regard to the specific investment objectives, financial situation and particular needs of any person. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of any person acting based on this information. You should seek advice from a financial adviser regarding the suitability of any investment product(s) mentioned herein, taking into account your specific investment objectives, financial situation or particular needs, before making a commitment to invest in such products. Opinions expressed in these commentaries are subject to change without notice. Investments are subject to investment risks including the possible loss of the principal amount invested. The value of units in any fund and the income from them may fall as well as rise. Past performance figures as well as any projection or forecast used in these commentaries are not necessarily indicative of future or likely performance. Phillip Securities Pte Ltd (PSPL), its directors, connected persons or employees may from time to time have an interest in the financial instruments mentioned in these commentaries. The information contained in these commentaries has been obtained from public sources which PSPL has no reason to believe are unreliable and any analysis, forecasts, projections, expectations and opinions (collectively the “Research”) contained in these commentaries are based on such information and are expressions of belief only. PSPL has not verified this information and no representation or warranty, express or implied, is made that such information or Research is accurate, complete or verified or should be relied upon as such. Any such information or Research contained in these commentaries are subject to change, and PSPL shall not have any responsibility to maintain the information or Research made available or to supply any corrections, updates or releases in connection therewith. 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Understanding Technology ETFs: Participate in AI Megatrend with Suitable Portfolio

Published on Jun 17, 2026 73

When constructing an investment portfolio, defensive assets such as bonds and income-generating equities provide stability. However, to outperform inflation and achieve meaningful long-term wealth compounding, investors may benefit from allocating more into growth companies. In today’s global economy, one of the key growth engines is the technology sector, which powers the artificial intelligence (AI) ecosystem. From semiconductors and cloud infrastructure to data centres and advanced software, AI is not a single industry—it is an entire value chain. For retail investors, Technology ETFs (Exchange-Traded Funds) offer the most efficient way to gain diversified exposure across this ecosystem without the concentration risk of picking individual winners. This guide focuses on how investors can strategically deploy different types of Technology ETFs to capture the AI megatrend. 1. Understanding Tech ETFs as AI Exposure Vehicles Technology ETFs are fundamentally growth-oriented instruments with higher investment risk profiles compared to broad-based market ETFs. Unlike traditional value sectors, technology companies reinvest earnings into innovation, allowing them to scale rapidly alongside structural trends such as AI adoption. Key implications for investors: Higher Volatility, Higher Potential Returns: Tech ETFs may enjoy large upside growth, but they can also suffer from sharper drawdowns across market cycles. Interest Rate Sensitivity: Falling rates tend to support technology valuations, making macro timing relevant for entry points. Capital Gains Focus: Returns are driven primarily by price appreciation, not dividends. For investors, this means Tech ETFs should be positioned as long-term growth allocators, not income tools. 2. Mapping Tech ETFs to the AI Value Chain A more effective way to invest in AI is to understand where each ETF sits within the AI infrastructure stack: AI Value Chain Exposure via ETFs: AI Models & Software (Top Layer) Exposure via mega-cap heavy ETFs, such as NASDAQ-100 trackers → Example of companies: Microsoft, Alphabet, Meta Compute & Data Centres (Middle Layer) Exposure via diversified or semiconductor-focused ETFs → Example of companies: NVIDIA, AMD, Broadcom Infrastructure Enablers (Foundational Layer) Indirect exposure via broader tech or thematic ETFs → Examples include power, cooling, and industrial enablers Investor Insight: Owning a single ETF may overweight one layer. Selecting a few targeted ETFs can help investors expand their exposure across the AI ecosystem. 3. Choosing the Right “Flavour” of Tech ETF (With Real Market Proxies) To effectively capture the AI megatrend, investors should think beyond generic “tech exposure” and instead select ETFs based on where they sit within the AI ecosystem and their risk-return profile. Below is a practical breakdown using widely traded institutional ETFs: ETF Name Ticker Listing Strategy AUM (Approx) Expense Ratio No. of Holdings Key Exposure Invesco QQQ Trust QQQ NASDAQ Mega-cap growth ~US$494B 0.18% ~102 AI platforms (Microsoft, NVIDIA, Apple) Technology Select Sector SPDR XLK NYSE Arca S&P 500 Tech ~US$124B 0.08% ~75 Pure US tech leaders Invesco NASDAQ Next Gen 100 QQQJ NASDAQ Mid-cap innovators ~US$1B 0.15% ~104 Emerging AI & software players iShares MSCI World IT UCITS ETF WITS Euronext Global diversified ~US$1.04B 0.18% ~135 Global tech (US and Europe e.g. ASML) iShares Hang Seng TECH ETF 3067 HK HKEX China tech ~HKD15B 0.25% ~34 Alibaba, Tencent, Meituan a) Mega-Cap Tech ETFs (Core AI Exposure): A significant portion of AI profits today is concentrated within a handful of mega-cap firms. These ETFs are the most direct way to gain exposure to AI leaders and hyperscalers, which dominate spending on AI infrastructure and model development. Examples: QQQ - Invesco QQQ Trust, XLK - State Street Technology Select Sector SPDR ETF b) Small & Mid-Cap Tech ETFs (AI Growth Optionality): While riskier, these companies represent more specific firms benefiting from AI growth These ETFs target the next generation of AI beneficiaries, including: SaaS platforms integrating AI Cybersecurity firms Vertical AI applications Example: QQQJ - Invesco NASDAQ Next Gen 100 ETF c) Multi-Cap / Global Tech ETFs (Balanced Exposure): AI sector involves global supply chain. Global exposure helps investors avoid missing out on the growth of critical enablers outside of US market Example: WITS - iShares MSCI World Information Technology Sector Advanced UCITS ETF USD Inc These ETFs provide diversified exposure across: US mega-cap leaders Semiconductor supply chain International tech, such as ASML in Europe d) Regional Tech ETFs (China / Asia Angle): Asia and other regions also have significant investment opportunities tapping on the AI technology growth These ETFs capture: China’s AI ecosystem Platform companies adapting AI into e-commerce, fintech, and logistics Key risk: Regulatory intervention and policy shifts remain a key overhang. Example: 3067 HK - iShares Hang Seng TECH ETF 4. Implementation Strategy: Building an AI ETF Portfolio Rather than selecting a single ETF, investors should construct a layered exposure strategy aligned with the AI value chain. Step 1: Define Your Core Exposure (Foundation Layer) Start with a mega-cap ETF (QQQ or XLK) Suggested allocation: 15%–25% Step 2: Add Diversification (Ecosystem Layer) Incorporate a global or multi-cap ETF (WITS) Suggested allocation: 10%–20% Step 3: Add Growth Optionality (Satellite Layer) Allocate to mid-cap innovators (QQQJ) Suggested allocation: 5%–10% Step 4: Optional Regional Tilt (Tactical Layer) For investors seeking diversification Suggested allocation: 0%–10% Example Portfolio Construction (Balanced Investor) Allocation Bucket ETF Example Weight Core AI Leaders QQQ 20% Global Tech Diversification WITS 15% Growth Innovators QQQJ 10% Asia Tech Exposure 3067 HK 5% Total Tech Allocation 50% The AI opportunity is not confined to a single company or ETF. It is a multi-layer ecosystem spanning platforms, compute, and infrastructure. By combining different types of Technology ETFs, investors can: Capture exposure to current AI leaders Participate in future disruptors Gain exposure to the global technology supply chain The AI megatrend acts as a structural growth multiplier due to the following growth factors: Rising global AI capital expenditure Increasing demand for compute and infrastructure Productivity gains across industries Even a modest allocation can potentially enhance long-term portfolio returns. 6. Implementation Checklist for Investors Before investing in any Technology ETF, investors can apply this screening framework: Concentration Risk Check the ETF’s top holdings andensure alignment with your investment conviction Sub-sector Exposure Know whether you are buying exposure to semiconductors, software, or broad technology Expense Ratio For passive ETFs, consider funds with an expense ratio below 0.50% Liquidity & AUM Prefer funds with strong trading volume and scale and sufficient scale Currency Considerations Factor in USD/HKD currency risk exposure against SGD base currency Final Takeaway The AI revolution is not just about breakthrough technologies—it is also about the infrastructure and ecosystem that supports it. Technology ETFs provide investors with a scalable, diversified, and liquid way to participate in this transformation. If bonds are the anchor of a portfolio, then Technology ETFs can serve as the growth engine—capturing the momentum of AI, compounding capital over time, and positioning investors on the right side of one of the most powerful structural trends of this decade. Disclaimer These commentaries are intended for general circulation and do not have regard to the specific investment objectives, financial situation and particular needs of any person. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of any person acting based on this information. You should seek advice from a financial adviser regarding the suitability of any investment product(s) mentioned herein, taking into account your specific investment objectives, financial situation or particular needs, before making a commitment to invest in such products. Opinions expressed in these commentaries are subject to change without notice. Investments are subject to investment risks including the possible loss of the principal amount invested. The value of units in any fund and the income from them may fall as well as rise. Past performance figures as well as any projection or forecast used in these commentaries are not necessarily indicative of future or likely performance. Phillip Securities Pte Ltd (PSPL), its directors, connected persons or employees may from time to time have an interest in the financial instruments mentioned in these commentaries. The information contained in these commentaries has been obtained from public sources which PSPL has no reason to believe are unreliable and any analysis, forecasts, projections, expectations and opinions (collectively the “Research”) contained in these commentaries are based on such information and are expressions of belief only. PSPL has not verified this information and no representation or warranty, express or implied, is made that such information or Research is accurate, complete or verified or should be relied upon as such. Any such information or Research contained in these commentaries are subject to change, and PSPL shall not have any responsibility to maintain the information or Research made available or to supply any corrections, updates or releases in connection therewith. In no event will PSPL be liable for any special, indirect, incidental or consequential damages which may be incurred from the use of the information or Research made available, even if it has been advised of the possibility of such damages. The companies and their employees mentioned in these commentaries cannot be held liable for any errors, inaccuracies and/or omissions howsoever caused. Any opinion or advice herein is made on a general basis and is subject to change without notice. The information provided in these commentaries may contain optimistic statements regarding future events or future financial performance of countries, markets or companies. You must make your own financial assessment of the relevance, accuracy and adequacy of the information provided in these commentaries. Views and any strategies described in these commentaries may not be suitable for all investors. Opinions expressed herein may differ from the opinions expressed by other units of PSPL or its connected persons and associates. Any reference to or discussion of investment products or commodities in these commentaries is purely for illustrative purposes only and must not be construed as a recommendation, an offer or solicitation for the subscription, purchase or sale of the investment products or commodities mentioned. This advertisement has not been reviewed by the Monetary Authority of Singapore.

The AI Infrastructure Buildout Is Just Beginning

Published on Jun 17, 2026 40

"We have only just begun this buildout." Those were the words of NVIDIA CEO Jensen Huang when describing the artificial intelligence (AI) revolution. Huang recently referred to AI as the "largest infrastructure buildout in human history", arguing that trillions of dollars of investment will be required before the full potential of AI can be realised. While investors often focus on AI applications such as ChatGPT, autonomous agents, and generative content, the more immediate investment opportunity may lie beneath the surface—in the infrastructure powering these technologies. Just as the internet required data centres, fibre networks and cloud computing platforms, AI requires unprecedented amounts of computing power, memory, storage and networking capacity. Every AI model trained and every AI query processed relies on a vast ecosystem of hardware providers operating behind the scenes. AI's Unsung Hero: Memory One company increasingly attracting investor attention is Micron Technology. While NVIDIA's GPUs often dominate headlines, advanced memory has become one of the most critical components within AI systems. High Bandwidth Memory (HBM) allows AI accelerators to process enormous volumes of data at the speeds required by modern AI workloads. Micron's recent results highlight the strength of this trend. The company reported record revenue, earnings and cash flow, driven by robust AI-related demand and tight industry supply conditions. Management noted that AI demand continues to support strong growth across its memory business. Analysts have also pointed to HBM as a major growth driver, with demand from hyperscale data centres creating a structural shift in the memory market. Consensus expectations for Micron's HBM revenue have been revised sharply higher as AI infrastructure spending accelerates globally. Beyond NVIDIA: The Broader AI Ecosystem The AI investment theme extends well beyond a handful of technology giants. Investors are increasingly exploring opportunities across the entire AI value chain, including semiconductor manufacturers, memory suppliers, networking providers, cloud infrastructure companies and data-centre operators. Recent industry commentary suggests that AI-related spending remains resilient despite periodic market volatility. Memory demand, in particular, continues to benefit from the rapid expansion of AI training and inference workloads. Some analysts have even described the current environment as the early stages of a semiconductor "supercycle" driven by AI infrastructure investment. Accessing AI Opportunities Through US Markets Many of the world's leading AI companies are listed in the United States, making US equities a key destination for investors seeking exposure to this transformative trend. With US Zero Commission Trading with POEMS Cash Plus Account, investors can access a wide range of AI-related opportunities across the US market while reducing transaction costs. Whether investing in established industry leaders or emerging beneficiaries of the AI infrastructure buildout, lower trading costs can help investors participate more efficiently in long-term growth themes. The AI revolution is changing the world as we know it. As Jensen Huang said that “It is a foregone conclusion that AI will be infrastructure for the world, just like the Internet was infrastructure for the world.” FAQ 1. Is AI taking a breather, or something bigger? On Wednesday 10th June 2026 morning (SG time), US indexes after close: Nasdaq slipped -1% S&P slipped -0.3% DOW gained +0.2% A clear sector rotation is occurring, with AI and AI-linked sectors pulling back after record breaking rallies; as concerns around overextended AI valuations, geopolitical escalations and rising rate odds weighed on expectations. The Dow which represents the “old” economy and blue chips stocks, including financials, real estate, consumer goods, healthcare, ended up higher compared with the tech-dominant Nasdaq and cap weighted S&P 500 (as seen below). Figure 1: Daily and weekly performances of the 11 Sectors in the US as of 10th June 2026 (Wednesday) https://finviz.com/groups 2. Tech in danger zone? As at 9th June 2026, the daily chart of the Tech sector ETF (XLK) relative to the SPDR S&P 500 ETF Trust SPY has suffered a sharp fall to its 20-day EMA support area (red dotted line). A clear underperformance against S&P 500. Key support area remains the orange line of 0.2422, which was its previous resistance.If sell off pressures were to persist, the XLK/SPY ratio could fall to the green support area of 0.2338. A breakdown below that support would invalidate the bullish momentum that pushed the XLK to parabolic highs. From a momentum point of view, XLK has still outperformed the S&P 500 index YTD, with prices above key moving averages. But recent price action seems to suggest that its lead may be narrowing as the rest of the laggards play catch up. Watch out for the key support levels, with 0.2338 serving as an important level, represented by the green line. Alternatives sector plays Healthcare (XLV) The big laggard of 2025, is it finally playing catch-up in 2026? From a technical point of view, XLV has restored bullish momentum in the short term, as the 20-day Exponential Moving Average crosses above 40-day Exponential Moving Average, supported by decisive breakouts above several key resistance levels. Its current rally represents a significant turnaround from the weakness seen earlier in 2026, with the April low serving as a key support area The bullish rally will set to continue if prices can break above the key resistance area of US$155, represented by the white line. Real Estate (XLRE) Price action is bullish in the short term, with 20-day Exponential Moving Average, represented by thered dotted line crosses above 40-dayExponential Moving Average, represented by the blue dotted. Coupled with a decisive break above the former resistance at US$43 (orange line). That resistance area has transformed into a key support area through a classic resistance to support reversal. The key resistance area to watch would be US$45, represented by the white line, the swing high within the Fibonacci retracement. Price action seems poised for another leg up if there is a break above, after some range bound trading from April to May. Disclaimer These commentaries are intended for general circulation and do not have regard to the specific investment objectives, financial situation and particular needs of any person. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of any person acting based on this information. You should seek advice from a financial adviser regarding the suitability of any investment product(s) mentioned herein, taking into account your specific investment objectives, financial situation or particular needs, before making a commitment to invest in such products. Opinions expressed in these commentaries are subject to change without notice. Investments are subject to investment risks including the possible loss of the principal amount invested. The value of units in any fund and the income from them may fall as well as rise. Past performance figures as well as any projection or forecast used in these commentaries are not necessarily indicative of future or likely performance. Phillip Securities Pte Ltd (PSPL), its directors, connected persons or employees may from time to time have an interest in the financial instruments mentioned in these commentaries. The information contained in these commentaries has been obtained from public sources which PSPL has no reason to believe are unreliable and any analysis, forecasts, projections, expectations and opinions (collectively the “Research”) contained in these commentaries are based on such information and are expressions of belief only. PSPL has not verified this information and no representation or warranty, express or implied, is made that such information or Research is accurate, complete or verified or should be relied upon as such. Any such information or Research contained in these commentaries are subject to change, and PSPL shall not have any responsibility to maintain the information or Research made available or to supply any corrections, updates or releases in connection therewith. In no event will PSPL be liable for any special, indirect, incidental or consequential damages which may be incurred from the use of the information or Research made available, even if it has been advised of the possibility of such damages. The companies and their employees mentioned in these commentaries cannot be held liable for any errors, inaccuracies and/or omissions howsoever caused. Any opinion or advice herein is made on a general basis and is subject to change without notice. The information provided in these commentaries may contain optimistic statements regarding future events or future financial performance of countries, markets or companies. You must make your own financial assessment of the relevance, accuracy and adequacy of the information provided in these commentaries. Views and any strategies described in these commentaries may not be suitable for all investors. Opinions expressed herein may differ from the opinions expressed by other units of PSPL or its connected persons and associates. Any reference to or discussion of investment products or commodities in these commentaries is purely for illustrative purposes only and must not be construed as a recommendation, an offer or solicitation for the subscription, purchase or sale of the investment products or commodities mentioned. This advertisement has not been reviewed by the Monetary Authority of Singapore.

S&P 500 ETFs: Comparing IVV/VOO/SPY, CSPX/SPYL & S27

Published on Jun 16, 2026 132

While the full list of S&P 500 ETFs is extensive, focusing on the most popular options makes your selection process much easier to navigate. Most popular S&P 500 ETF on US Market – IVV, VOO & SPY Save on withholding tax with Ireland domiciled UCITS ETFs - CSPX vs SPYL Invest in S&P 500 ETF using SRS - S27 Why invest in an S&P 500 ETF? You can't invest directly in an index, however, you can buy an ETF that holds the same companies in similar proportions, giving you diversification across 500 companies in a single purchase. Key Benefits: Diversification – One share spreads your risk across hundreds of companies and multiple sectors. Low Cost – S&P 500 ETFs are among the cheapest investments available, with expense ratios often under 0.10%. Simplicity – No need to research individual stocks or rebalance your portfolio manually. Liquidity – These ETFs trade millions of shares daily, so you can buy or sell anytime the market is open. Five S&P 500 ETFs at a Glance VOO, IVV and SPY are the most popular S&P 500 ETFs. CSPX and SPYL are UCTIS ETFs that have rapidly grown in popularity among international investors due to the structural tax efficiencies offered by its Irish domicile. While they all track the same index, they differ in areas like fees, trading liquidity, and fund structure — factors that can meaningfully affect your returns over time. Read on: ETF Ticker Issuer Expense Ratio Assets Under Management Listed On SPY State Street (SPDR) 0.0945% ~$768B USD NYSE IVV BlackRock (iShares) 0.03% ~$831B USD NYSE VOO Vanguard 0.03% ~$1.6T USD NYSE CSPX BlackRock (iShares) 0.07% ~$144B USD LSE SPYL State Street (SPDR) 0.03% ~$18B USD LSE (Data as of 26/05/26) 1. SPDR S&P 500 ETF Trust (SPY) Launched in 1993, SPY was the first ETF in the United States and remains the most heavily traded. Its massive daily volume makes it the go-to choice for traders, hedge funds, and institutions that need to move large amounts of money quickly. The downside? Its fees are higher compared to IVV and VOO. It also uses an older structure that does not automatically reinvest dividends. Best for: Active traders and those who prioritize liquidity above all else. Not ideal for: Long-term investors focused on keeping costs low. 2. iShares Core S&P 500 ETF (IVV) BlackRock’s iShares Core S&P 500 ETF matches VOO’s rock-bottom expense ratio and immediately reinvests dividends, which can slightly improve long-term returns through compounding. It’s structured as a standard ETF (unlike SPY’s older unit investment structure), giving it a bit more flexibility. Best for: Long-term investors who want low costs and don’t need SPY’s extreme liquidity. 3. Vanguard S&P 500 ETF (VOO) Vanguard is synonymous with low-cost investing, and VOO delivers exactly that. It’s nearly identical to IVV in structure and cost. For most people, choosing between VOO and IVV usually comes down to personal preference. Best for: Long-term investors focused on minimizing fees. 4. iShares Core S&P 500 UCITS ETF (CSPX) iShares Core S&P 500 UCITS ETF is a popular choice for international investors due to its Ireland domicile. Dividend withholding tax is 15%. Since it is an accumulating fund, dividends are reinvested automatically, which enhances long-term compounding. It has a slightly higher expense ratio and may experience lower liquidity and small tracking differences compared to US-listed S&P 500 ETFs due to trading and market structure differences, but the lower dividend withholding tax and accumulating structure can possibly lead to higher returns over the long term. Key Consideration: CSPX is listed on London Stock Exchange (LSE), subjected to LSE commission and exchange fees. 5. SPDR S&P 500 UCITS ETF (SPYL) SPYL is a much newer offering that is Ireland domiciled and has the same accumulating structure as CSPX. The accumulating share class officially launched on 31 October 2023. It is highly liquid but does not yet match the sheer historical trading volume and fund size of CSPX. Compared with CSPX, SPYL aggressively captures market share with its lower expense ratio. It is one of the cheapest S&P 500 UCITS ETFs available. SPYL also has a lower nominal share price, making it highly accessible and capital-efficient for frequent Dollar-Cost Averaging (DCA), without needing to rely heavily on fractional shares. Key Consideration: SPYL is listed on London Stock Exchange (LSE), subjected to LSE commission and exchange fees. Invest in S&P 500 with SRS You can also invest in S&P 500 ETF on Singapore Stock Exchange as SPDR S&P 500 ETF Trust (S27), which tracks the same index as the US-listed SPY. You can buy S27 with your SRS monies through POEMS, do remember to select settlement in SGD! S27 is not available under CPF Investment Scheme (CPFIS), so you cannot use CPF OA/SA to buy it. The Bottom Line Over the long run, the S&P 500 has historically returned around 10% annually on average, despite going through events such as wars, recessions, and financial crises. Of course, future returns are never guaranteed but owning a slice of America’s largest companies has generally been a reliable way to build wealth over time. An S&P 500 ETF won’t make you rich overnight. But for patient investors willing to ride out market ups and downs, it remains one of the simplest and most effective tools available. Interested in investing in SPY/VOO/IVV/CSPX/SPYL or S27? Just enter the ticker code and add them to your POEMS watchlist! ETF Ticker Issuer Listed On Payment Method SPY State Street (SPDR) NYSE Cash IVV BlackRock (iShares) NYSE Cash VOO Vanguard NYSE Cash CSPX BlackRock (iShares) LSE Cash SPYL State Street (SPDR) LSE Cash S27 State Street (SPDR) SGX Cash & SRS Looking to dollar-cost average and invest regularly? Explore recurring order and Share Builder Plan. Subscribe for free US live prices for SPY/VOO/IVV Subscribe for free SGX enhanced market depth for S27 Disclaimer These commentaries are intended for general circulation and do not have regard to the specific investment objectives, financial situation and particular needs of any person. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of any person acting based on this information. You should seek advice from a financial adviser regarding the suitability of any investment product(s) mentioned herein, taking into account your specific investment objectives, financial situation or particular needs, before making a commitment to invest in such products. Opinions expressed in these commentaries are subject to change without notice. Investments are subject to investment risks including the possible loss of the principal amount invested. The value of units in any fund and the income from them may fall as well as rise. Past performance figures as well as any projection or forecast used in these commentaries are not necessarily indicative of future or likely performance. Phillip Securities Pte Ltd (PSPL), its directors, connected persons or employees may from time to time have an interest in the financial instruments mentioned in these commentaries. The information contained in these commentaries has been obtained from public sources which PSPL has no reason to believe are unreliable and any analysis, forecasts, projections, expectations and opinions (collectively the “Research”) contained in these commentaries are based on such information and are expressions of belief only. PSPL has not verified this information and no representation or warranty, express or implied, is made that such information or Research is accurate, complete or verified or should be relied upon as such. Any such information or Research contained in these commentaries are subject to change, and PSPL shall not have any responsibility to maintain the information or Research made available or to supply any corrections, updates or releases in connection therewith. In no event will PSPL be liable for any special, indirect, incidental or consequential damages which may be incurred from the use of the information or Research made available, even if it has been advised of the possibility of such damages. The companies and their employees mentioned in these commentaries cannot be held liable for any errors, inaccuracies and/or omissions howsoever caused. Any opinion or advice herein is made on a general basis and is subject to change without notice. The information provided in these commentaries may contain optimistic statements regarding future events or future financial performance of countries, markets or companies. You must make your own financial assessment of the relevance, accuracy and adequacy of the information provided in these commentaries. Views and any strategies described in these commentaries may not be suitable for all investors. Opinions expressed herein may differ from the opinions expressed by other units of PSPL or its connected persons and associates. Any reference to or discussion of investment products or commodities in these commentaries is purely for illustrative purposes only and must not be construed as a recommendation, an offer or solicitation for the subscription, purchase or sale of the investment products or commodities mentioned. This advertisement has not been reviewed by the Monetary Authority of Singapore.

Singapore Banking Sector Outlook Stabilises as Interest Rates Turn Positive, Target Prices Raised

Published on Jun 12, 2026 218

Interest Rate Environment Shows Signs of Recovery Singapore's banking sector is experiencing a notable shift as interest rates begin to stabilise after an extended period of decline. The 3-month Singapore Overnight Rate Average (SORA) rose 2 basis points month-on-month to 1.07% in May, marking the first monthly increase in two years since May 2024. This development signals a potential turning point for the sector, with the year-on-year decline of 124 basis points representing the smallest such decrease in 13 months. Strong Loan Growth and Deposit Dynamics Support Banks The banking environment has shown robust fundamentals, with Singapore year-on-year loan growth reaching 7.9% in April 2026, the highest level since the post-COVID period. Banks have maintained their low-to-mid-single-digit guidance despite this strong performance. Current Account and Savings Account (CASA) deposits have risen 14% year-on-year, whilst the CASA ratio to deposits remains stable at 20.5%, down marginally from 20.6% in March 2026. This represents the second highest CASA ratio in 41 months, providing a significant tailwind for banks by lowering funding costs and cushioning net interest margin compression. Research Maintains Neutral Stance with Raised Target Prices Phillip Securities Research maintains a NEUTRAL recommendation on the Singapore banking sector. The Monetary Authority of Singapore's 14 April tightening of the Singapore dollar Nominal Effective Exchange Rate appreciation path remains in effect, alongside the Federal Reserve's higher-for-longer stance. Markets are currently pricing in zero US rate cuts for 2026, creating a supportive backdrop for net interest margins. The rate environment is expected to remain net interest margin-supportive, with stabilisation projected to extend through the second half of 2026 as deposit repricing flows through the system. Market volatility continues to benefit capital markets income and wealth management fees, providing a meaningful offset to net interest income headwinds. Research analysts have raised target prices for all three major Singapore banks: DBS to S$67.50 from S$61.00, OCBC to S$24.00 from S$22.00, and UOB to S$39.00 from S$37.00. These increases reflect lower risk-free rate and equity-risk premium assumptions based on the more stable interest rate environment. Banks' dividend yields remain attractive at 4.5%, with ongoing buybacks improving return on equity. Frequently Asked Questions [market_journal_faq] This article has been auto-generated using PhillipGPT. It is based on a report by a Phillip Securities Research analyst. Disclaimer These commentaries are intended for general circulation and do not have regard to the specific investment objectives, financial situation and particular needs of any person. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of any person acting based on this information. You should seek advice from a financial adviser regarding the suitability of any investment product(s) mentioned herein, taking into account your specific investment objectives, financial situation or particular needs, before making a commitment to invest in such products. Opinions expressed in these commentaries are subject to change without notice. Investments are subject to investment risks including the possible loss of the principal amount invested. The value of units in any fund and the income from them may fall as well as rise. Past performance figures as well as any projection or forecast used in these commentaries are not necessarily indicative of future or likely performance. Phillip Securities Pte Ltd (PSPL), its directors, connected persons or employees may from time to time have an interest in the financial instruments mentioned in these commentaries. The information contained in these commentaries has been obtained from public sources which PSPL has no reason to believe are unreliable and any analysis, forecasts, projections, expectations and opinions (collectively the “Research”) contained in these commentaries are based on such information and are expressions of belief only. PSPL has not verified this information and no representation or warranty, express or implied, is made that such information or Research is accurate, complete or verified or should be relied upon as such. Any such information or Research contained in these commentaries are subject to change, and PSPL shall not have any responsibility to maintain the information or Research made available or to supply any corrections, updates or releases in connection therewith. In no event will PSPL be liable for any special, indirect, incidental or consequential damages which may be incurred from the use of the information or Research made available, even if it has been advised of the possibility of such damages. The companies and their employees mentioned in these commentaries cannot be held liable for any errors, inaccuracies and/or omissions howsoever caused. Any opinion or advice herein is made on a general basis and is subject to change without notice. The information provided in these commentaries may contain optimistic statements regarding future events or future financial performance of countries, markets or companies. You must make your own financial assessment of the relevance, accuracy and adequacy of the information provided in these commentaries. Views and any strategies described in these commentaries may not be suitable for all investors. Opinions expressed herein may differ from the opinions expressed by other units of PSPL or its connected persons and associates. Any reference to or discussion of investment products or commodities in these commentaries is purely for illustrative purposes only and must not be construed as a recommendation, an offer or solicitation for the subscription, purchase or sale of the investment products or commodities mentioned. This advertisement has not been reviewed by the Monetary Authority of Singapore.

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