Q3 Investors' Newsletter
July 2026
Galilee Investment Management
Message from Chief Operating Officer
Mr. Franklin Chua,
COO
Dear Investors,
As we reach the midpoint of 2026, I would like to thank our investors, business partners, and stakeholders for your continued trust and confidence in Galilee.
The first half of the year has been one of steady execution and meaningful progress. Despite an evolving investment environment, we have remained focused on strengthening our investment platform, internal processes, governance, and investor servicing capabilities.
We are also happy to announce that we have expanded our separately managed account strategy with the launch of our new SMA Options Income Strategy under Galilee Heritage Services. The strategy is designed to generate recurring option premium income through a disciplined and risk-managed approach, with portfolios managed according to each investor’s account size and investment objectives. At the same time, we have 3 new sub-funds that are in the final stages of preparation and are expected to be launched this year. These initiatives reflect our continued efforts to broaden the range of investment solutions available to our investors.
The regulatory and banking environment has also become increasingly demanding, with banks applying more extensive compliance checks, transaction reviews, and ongoing due diligence requirements. While these measures may result in longer processing times, we continue to work closely with our banking and professional partners to ensure that transactions are properly supported and completed as efficiently as possible.
As we grow, we remain committed to maintaining high standards of transparency, accountability, risk management, and regulatory compliance. These foundations are essential to protecting our investors’ interests and creating sustainable long-term value.
Detailed performance updates and portfolio highlights will be shared by each investment team in the following sections of this newsletter.
That is all from me but do read on for fund specific updates by clicking on the button below. We would like to thank you for your patience and continued support. Please feel free to reach out to us if you have any feedback.
Regards,
Franklin Chua
Galilee Fixed Income Fund
Fund Description: The Fund adopts a diversified investment strategy focusing on sourcing and evaluating public and private fixed income products, specifically in areas of specialty financing, senior/subordinate real estate backed debt, factoring/trading financing, direct lending and corporate bonds, offered globally, to provide investors with a stable and consistent dividend yield through the market cycle.
Fund Updates
Fund Performance
We are pleased to share that since inception, the Galilee Fixed Income Fund has delivered a consistent annualised return of 9%, with quarterly dividend distributions and no defaults across 16 consecutive quarters. This reflects our continued focus on income stability, credit discipline and capital preservation.
The underlying portfolio continues to perform in line with expectations. We continue to closely monitor borrower performance, repayment schedules, collateral coverage and material credit developments, while we continue to seek portfolio diversification. In the meantime, we continue to evaluate new secured lending, asset-backed financing and other public and private fixed-income opportunities across the region. We will share further updates as these opportunities progress and become more concrete. We remain disciplined and very selective, and will deploy capital only where the expected returns adequately compensate the Fund for the underlying risks.
Update on Manhattan Special Economic Zone Feasibility Study
Following the completion of the feasibility study and roadshow, we have decided to place the affordable housing project within the Manhattan Special Economic Zone on hold.
The study indicated that there is underlying demand for affordable housing within the area. However, the Fund would currently be required to assume a significant portion of the project’s execution, sales and buyer default risks. In our view, these risks should be more appropriately shared or substantially supported by the government and the relevant project partners, particularly given the social and developmental objectives of an affordable housing programme.
The Cambodian Government introduced a new affordable housing policy in February 2026 and is continuing to develop the supporting implementation framework. We will monitor how the policy is translated into practical measures, including buyer financing support, risk-sharing arrangements and greater certainty around project execution. Should these conditions improve and the allocation of risks become more balanced, the project may be worth revisiting in the future.
H2 2026 Outlook
We remain selective in deploying capital and will pursue opportunities only where the expected returns are supported by sound fundamentals and an appropriate allocation of risk. We thank our investors for your continued trust and support.
Click here or contact investor_relations@galileeinvestment.com if you wish to find out more!
Latest Economic Developments in Cambodia
Cambodia is ramping up efforts to tackle a projected shortfall of 1.1 million homes by 2030 through stronger partnerships, including a new three-year agreement to improve housing conditions for around 15,000 households. Full article here (Kiripost).
Techo International Airport (TIA), Cambodia’s largest aviation infrastructure project, which commenced operations on September 9, 2025, received a vote of confidence with a $100 million strategic financing commitment from the U.S. International Development Finance Corporation (DFC). Full article here (Khmer Times).
As Cambodia’s property market becomes increasingly connected to regional investment trends, some investors are exploring alternative models that have proven successful elsewhere in Southeast Asia. Full article here (Khmer Times)
Siem Reap is evolving, and while the Smart City project is not new, the second phase has now been approved, set to run from September 2026 to August 2028. Full article here (Khmer Times).
Fund Description: Compounder Fund is an open-ended fund that focuses on long-term investing in public equities around the world. The investment strategy is to find Compounders – public-listed companies that are able to grow their businesses at high-rates over the long run – through holistic fundamental analysis and holding onto their shares for years. The Fund aims to generate a 12% annualised return, net of all fees, over the long-term.
Fund Updates
Compounder Fund’s latest 2026 second-quarter letter was published on 13 July 2026 and you can find it here.
If you wish to find out more, please contact jeremy.chia@galileeinvestment.com.
Visit our website to get the latest updates on the Fund’s Performance and Investment Theses:
Vision Capital Fund
Fund Description: Vision Capital Fund is an open-ended fund that focuses on long-only global equities. This fund aims to deliver superior, sustainable, compelling long-term (over five years and more) returns for investors by investing in the stock market, specifically in quality, durable, and innovative compounders, riding secular tailwinds that can grow profitably and durably well for a long time at high rates of returns.
Fund Updates
If you wish to find out more about investing with Vision Capital Fund, don’t hesitate to get in touch with eugene.ng@visioncapitalfund.co.
Similarly, you can visit our website to find out more.
Separately Managed Accounts (SMA) - Galilee Heritage Services
Strategy 1
Strategy Description: Frederick Tye is the Portfolio Manager for our Global SMA mandate, a concentrated, value-focused strategy. We employ a “barbell” approach, pairing high-quality franchises with opportunistic deep-value plays. We balance this with strategic exposure to short-term US Treasuries, preserving capital during expensive markets to deploy aggressively when attractive opportunities emerge.
Investment Updates
Composite SMA Performance Update (H1 2026): For the period ending 30 June 2026, the SMA composite returned -9.84% net of fees; as our fee is tied to performance, none was payable this period.
Portfolio Commentary: We experienced a significant price decline in one of our holdings this period – our litigation-finance position. We bought it for what seemed like a fair price for a good business with a very large litigation claim that had already been decided in its favour – the kind of free optionality we always hope to find. On appeal, that ruling was overturned, and the shares fell sharply. Our margin of safety has certainly been reduced, though we think the business itself is still sound. What remains turn on whether the reversal can be further appealed and whether the business can carry its debt on its own. For now, we are neither adding nor selling.
Elsewhere, we put some of our cash to work – largely into non-AI-related businesses whose prices had detached from their fundamentals, and added to a few existing positions that had sold off.
What remains of our cash we continue to hold in short-duration US Treasuries, valuing the optionality it provides.
If you wish to find out more, please contact fred@mscap.sg
Strategy 2
Strategy Description: Franklin Chua is the Portfolio Manager for our Wheel Strategy SMA mandate, a systematic options income strategy that generates recurring premium income by selling cash-secured put options on quality securities that we are prepared to own. If assigned, we acquire the securities and continue generating income by selling covered call options. This approach seeks to enhance long-term returns through a combination of option premiums and capital appreciation while maintaining a disciplined, rules-based investment process.
Investment Updates
Our SMA strategy delivered a cumulative return of approximately 4.82% (as of 30 June 2026) since inception in April 2026, exceeding our internal target return trajectory. Performance was driven primarily by disciplined option premium collection through our Wheel Strategy, complemented by the appreciation of the US Dollar against the Singapore Dollar. Approximately 64% of returns were generated from premium collections, while around 36% resulted from favourable foreign exchange movements.
The strategy continues to focus on generating recurring option income using high-quality US-listed ETFs and stocks. Although extended temporary drawdowns remain possible during periods of market weakness, our ongoing research includes expanding into additional sector ETFs and fundamentally strong stocks, refining our strategy through further backtesting, and continuously improving our risk management. We remain committed to delivering attractive long-term risk-adjusted returns while preserving disciplined portfolio management.
Please refer to our Q2 2026 Investors’ Letter for more information.
If you wish to find out more, please contact franklin.chua@galileeinvestment.com
Contact us
Kindly email us at investor_relations@galileeinvestment.com or contact your usual Galilee contact if you have any questions, feedback or changes to your personal details (e.g. bank account, handphone, email address, residential address etc.) Kindly also inform us if you cease to be an Accredited Investor under the SFA at any time.
Disclaimer
This confidential Newsletter (“Newsletter”) has been prepared by Galilee Investment Management Pte Ltd (“Galilee”) for distribution to selected recipients only. This Newsletter is for information purposes and shall not be construed as investment advice or for marketing purposes. While reasonable care has been taken to prepare this document, the information contained herein may not be relied upon for accuracy or completeness; and any opinion or estimate contained in this document is subject to change without notice. This Newsletter must not be published, circulated, reproduced or distributed, in whole or part, to any other person without the prior consent from Galilee. Galilee makes no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this newsletter (article), will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio given changing market conditions. Please consult a professional investment consultant prior to making any investment decision.