SGX Market Strategist, Equity & Fixed Income, Singapore Exchange Ltd (SGX)

Geoff Howie

SGX Market Strategist, Equity & Fixed Income

Asia’s leading multi-asset exchange

Singapore Exchange Ltd (SGX)

Singapore Exchange is Asia’s leading and trusted market infrastructure, facilitating the exchange of capital and ideas to create value for people, businesses and economies. As a multi-asset exchange operating equity, fixed income and derivatives markets to the highest regulatory standards, SGX is a vertically integrated business that provides listing, trading, clearing, settlement, depository and data services.

With about 40% of listed companies and over 80% of listed bonds originating outside of Singapore as well as established linkages across the region and in Europe, SGX is Asia’s most international and connected exchange. Offering a full suite of derivatives products across Asian equity indices, commodities and currencies, SGX is the world’s most liquid international market for the benchmark equity indices of China, India, Japan and ASEAN.

As Asia’s pioneering central counterparty, SGX is globally recognised for its risk management and clearing capabilities, and was one of the first globally to adopt the Principles for Financial Market Infrastructure.

Headquartered in AAA-rated Singapore, SGX has over 800 employees including offices in Beijing, Chicago, Hong Kong, London, New York, Mumbai, San Francisco, Shanghai and Tokyo.

Equity Bottom-Up

Lion-Phillip S-REIT ETF / Equity Bottom-Up

<ul>
<li>In the 2020 YTD, Singapore-focused ETFs listed on SGX have seen net inflows of S$418 million, as investors seek attractive valuations and portfolio diversification amidst increased global volatility. &nbsp;</li>
<li>In the YTD, the three ETFs that saw the highest net inflows were: SPDR® STI ETF (+S$302M), Nikko AM STI ETF (+S$48M), and Nikko AM SGD Investment Grade Corporate Bond ETF (+S$31M). The trio averaged net inflows of S$127 million over the period. &nbsp;</li>
<li>SGD bond ETF investors have also benefited – the Nikko AM SGD Investment Grade Corporate Bond ETF, ABF Singapore Bond Index ETF, and Xtrackers II Singapore Government Bond UCITS ETF have clocked an average total return of 5.4% in the YTD, bringing their 1Y total return to 10.1%. &nbsp;
In the 2020 year-to-date, Singapore-focused ETFs listed on SGX have seen net inflows of S$418 million, as investors seek attractive valuations and portfolio diversification amidst increased global volatility. In the month of April, total market turnover value of ETFs on the Singapore bourse surged to S$469 million, up 140% from a year ago, as global markets staged partial rebounds from their March lows, SGX data showed. &nbsp;
ETFs with Highest YTD Net Inflows 
In the YTD, the three ETFs that saw the highest net inflows were: SPDR® STI ETF (+S$302.2 million), Nikko AM STI ETF (+S$48.4 million), and Nikko AM SGD Investment Grade Corporate Bond ETF (+S$30.7 million). The trio averaged net inflows of S$127.1 million over the period. As the benchmark Straits Times Index (STI) trades near multi-year lows, an increasing number of investors are using STI-tracking ETFs as a vehicle to gain instant exposure to Singapore’s top 30 blue chips. The&nbsp;<a href="https://www.spdrs.com.sg/etf/fund/spdr-straits-times-index-etf-ES3.html" target="_blank" rel="noopener">SPDR® STI ETF</a>,&nbsp;unveiled in 2002, is managed by State Street Global Advisors, while the&nbsp;<a href="https://www.nikkoam.com.sg/etf/sti" target="_blank" rel="noopener">Nikko AM STI ETF</a>, launched in 2009, is managed by Nikko Asset Management. Benefits of investing in the STI ETF include gaining exposure to the 30 constituents of the benchmark index through a single purchase and at a very low cost. Over the longer term, the returns can be sizeable. The <a href="https://www.nikkoam.com.sg/etf/sgd-investment-grade-corp-bond" target="_blank" rel="noopener">Nikko AM SGD Investment Grade Corporate Bond ETF</a> offers investors easy access to Singapore Dollar-denominated, investment-grade corporate bonds in affordable units. The fund aims to replicate the performance of the iBoxx SGD Non-Sovereigns Large Cap Investment Grade Index, allowing investors to diversify their portfolios with corporate bonds from high-quality issuers. Investors in SGD Bond ETFs have also benefited from strong returns, as the value of the underlying bonds increased in tandem with falling interest rates. The Nikko AM SGD Investment Grade Corporate Bond ETF, ABF Singapore Bond Index ETF and Xtrackers II Singapore Government Bond UCITS ETF have clocked an average total return of 5.4% in the YTD, bringing their one-year total return to 10.1%. Best-Yielding ETFs with Highest YTD Net Inflows
Among the ETFs that saw the highest net inflows in the YTD, Lion-Phillip S-REIT ETF, SPDR® STI ETF and Nikko AM STI ETF offer investors the best yields at 6.0%, 4.7% and 4.6% respectively, based on gross dividends paid over the past 12 months. The <a href="http://www.lionglobalinvestors.com/en/funds/lion-phillip-s-reit-etf/index.html#dashBoard?fcode=LEPF" target="_blank" rel="noopener">Lion-Phillip S-REIT ETF</a>, rolled out by Lion Global Investors and Phillip Capital Management in October 2017, tracks the Morningstar® Singapore REIT Yield Focus Index. This is the first REIT ETF in the world with Singapore REITs accounting for 100% of its constituents. There are more than 40 REITs and Property Trusts on SGX with a combined market cap of nearly S$90 billion. REIT popularity is exemplified in multiple ways – they comprise about one-tenth of STI constituents, all of the STI Reserve List stocks, and approximately one-tenth of the total market cap of SGX-listed stocks. The tables below detail the performance highlights of Singapore-focused ETFs listed on SGX, sorted by YTD net inflows.
<table class="table table-striped">
<tbody>
<tr>
<td>
Name
</td>
<td>
Stock Code
</td>
<td>
YTD Inflows (S$M)
</td>
<td>
YTD Total Return (%)
</td>
<td>
1Y Total Return (%)
</td>
<td>
3Y Total Return (%)
</td>
<td>
5Y Total Return (%)
</td>
</tr>
<tr>
<td>
SPDR® STI ETF
</td>
<td>
ES3
</td>
<td>
302.2
</td>
<td>
-20.6
</td>
<td>
-18.8
</td>
<td>
-14.0
</td>
<td>
-13.6
</td>
</tr>
<tr>
<td>
Nikko AM STI ETF
</td>
<td>
G3B
</td>
<td>
48.4
</td>
<td>
-21.2
</td>
<td>
-19.6
</td>
<td>
-14.8
</td>
<td>
-14.7
</td>
</tr>
<tr>
<td>
Nikko AM SGD Investment Grade Corporate Bond ETF
</td>
<td>
MHB
</td>
<td>
30.7
</td>
<td>
0.8
</td>
<td>
4.7
</td>
<td>
NA
</td>
<td>
NA
</td>
</tr>
<tr>
<td>
Lion-Phillip S-REIT ETF
</td>
<td>
CLR
</td>
<td>
24.8
</td>
<td>
-16.8
</td>
<td>
-7.5
</td>
<td>
NA
</td>
<td>
NA
</td>
</tr>
<tr>
<td>
ABF Singapore Bond Index ETF
</td>
<td>
A35
</td>
<td>
18.9
</td>
<td>
7.8
</td>
<td>
13.0
</td>
<td>
16.7
</td>
<td>
22.7
</td>
</tr>
<tr>
<td>
Xtrackers MSCI Singapore UCITS ETF^
</td>
<td>
O9A
</td>
<td>
-2.5
</td>
<td>
-24.4
</td>
<td>
-18.5
</td>
<td>
-8.6
</td>
<td>
-14.4
</td>
</tr>
<tr>
<td>
Xtrackers II Singapore Government Bond UCITS ETF^
</td>
<td>
KV4
</td>
<td>
-4.3
</td>
<td>
7.6
</td>
<td>
12.5
</td>
<td>
16.3
</td>
<td>
23.2
</td>
</tr>
</tbody>
</table>
<table class="table table-striped">
<tbody>
<tr>
<td>
Name
</td>
<td>
Stock Code
</td>
<td>
Fund Size (S$M)
</td>
<td>
12M Div Yld (%)
</td>
<td>
Expense Ratio (%)
</td>
<td>
Asset Class
</td>
<td>
Benchmark
</td>
</tr>
<tr>
<td>
SPDR® Straits Times Index ETF
</td>
<td>
ES3
</td>
<td>
959
</td>
<td>
4.7
</td>
<td>
0.3
</td>
<td>
Equities
</td>
<td>
Straits Times Index
</td>
</tr>
<tr>
<td>
Nikko AM STI ETF
</td>
<td>
G3B
</td>
<td>
301
</td>
<td>
4.6
</td>
<td>
0.3
</td>
<td>
Equities
</td>
<td>
Straits Times Index
</td>
</tr>
<tr>
<td>
Nikko AM SGD Investment Grade Corporate Bond ETF
</td>
<td>
MHB
</td>
<td>
522
</td>
<td>
2.0
</td>
<td>
0.3
</td>
<td>
Bonds
</td>
<td>
iBoxx SGD NonSovereigns Large Cap Investment Grade Index
</td>
</tr>
<tr>
<td>
Lion-Phillip S-REIT ETF
</td>
<td>
CLR
</td>
<td>
155
</td>
<td>
6.0
</td>
<td>
0.6
</td>
<td>
REITs
</td>
<td>
Morningstar® Singapore REIT Yield Focus Index
</td>
</tr>
<tr>
<td>
ABF Singapore Bond Index ETF
</td>
<td>
A35
</td>
<td>
946
</td>
<td>
2.0
</td>
<td>
0.3
</td>
<td>
Bonds
</td>
<td>
iBoxx ABF Singapore Bond Index
</td>
</tr>
<tr>
<td>
Xtrackers MSCI Singapore UCITS ETF^
</td>
<td>
O9A
</td>
<td>
43
</td>
<td>
0.0
</td>
<td>
0.5
</td>
<td>
Equities
</td>
<td>
MSCI Singapore Investable Market Total Return Net Index
</td>
</tr>
<tr>
<td>
Xtrackers II Singapore Government Bond UCITS ETF^
</td>
<td>
KV4
</td>
<td>
137
</td>
<td>
0.0
</td>
<td>
0.2
</td>
<td>
Bonds
</td>
<td>
Citi Singapore Government Bond Index
</td>
</tr>
</tbody>
</table>
Source: SGX (data as of 14 May 2020)
^Dividends are reinvested Investing in ETFs
ETFs are investment funds listed and traded intraday on a stock exchange. The majority aim to track the performance of an index and provide access to a wide variety of markets and asset classes, including local stocks, international securities, bonds, commodities or money markets. Each ETF gives investors access to the performance of the asset that comprises the underlying index. Investing in the ETF is also less costly if one was to build a similar portfolio by buying the individual stocks. It also provides exposure to international markets and asset classes that may be inaccessible to individual investors.
Investors can also invest in the STI ETFs using a Regular Shares Saving Plan (RSS). Click&nbsp;<a href="https://www.sgxacademy.com/rssp/" target="_blank" rel="noopener">here</a>&nbsp;to find out more. To find out more about ETFs, visit <a href="https://www.sgxacademy.com/home/infographics/what-you-need-to-know-about-investing-in-etfs/?utm_medium=display&amp;utm_source=DNS&amp;utm_campaign=ETFs&amp;utm_term=04052020&amp;utm_content=780x450B&amp;doing_wp_cron=1588902816.7561480998992919921875&amp;fireglass_rsn=true" target="_blank" rel="noopener">here</a>.&nbsp;&nbsp;
</li>
</ul>


In the 2020 YTD, Singapore-focused ETFs listed on SGX have seen net inflows of S$418 million, as investors seek attractive valuations and portfolio diversification amidst increased global volatility. &nbsp;
In the YTD, the three ETFs that saw the highest net inflows were: SPDR® STI ETF (+S$302M), Nikko AM STI ETF (+S$48M), and Nikko AM SGD Investment Grade Corporate Bond ETF (+S$31M). The trio averaged net inflows of S$127 million over the period. &nbsp;
SGD bond ETF investors have also benefited – the Nikko AM SGD Investment Grade Corporate Bond ETF, ABF Singapore Bond Index ETF, and Xtrackers II Singapore Government Bond UCITS ETF have clocked an average total return of 5.4% in the YTD, bringing their 1Y total return to 10.1%. &nbsp;
In the 2020 year-to-date, Singapore-focused ETFs listed on SGX have seen net inflows of S$418 million, as investors seek attractive valuations and portfolio diversification amidst increased global volatility. In the month of April, total market turnover value of ETFs on the Singapore bourse surged to S$469 million, up 140% from a year ago, as global markets staged partial rebounds from their March lows, SGX data showed. &nbsp;
ETFs with Highest YTD Net Inflows 
In the YTD, the three ETFs that saw the highest net inflows were: SPDR® STI ETF (+S$302.2 million), Nikko AM STI ETF (+S$48.4 million), and Nikko AM SGD Investment Grade Corporate Bond ETF (+S$30.7 million). The trio averaged net inflows of S$127.1 million over the period.  As the benchmark Straits Times Index (STI) trades near multi-year lows, an increasing number of investors are using STI-tracking ETFs as a vehicle to gain instant exposure to Singapore’s top 30 blue chips. The&nbsp;SPDR® STI ETF,&nbsp;unveiled in 2002, is managed by State Street Global Advisors, while the&nbsp;Nikko AM STI ETF, launched in 2009, is managed by Nikko Asset Management.  Benefits of investing in the STI ETF include gaining exposure to the 30 constituents of the benchmark index through a single purchase and at a very low cost. Over the longer term, the returns can be sizeable.  The Nikko AM SGD Investment Grade Corporate Bond ETF offers investors easy access to Singapore Dollar-denominated, investment-grade corporate bonds in affordable units. The fund aims to replicate the performance of the iBoxx SGD Non-Sovereigns Large Cap Investment Grade Index, allowing investors to diversify their portfolios with corporate bonds from high-quality issuers.  Investors in SGD Bond ETFs have also benefited from strong returns, as the value of the underlying bonds increased in tandem with falling interest rates. The Nikko AM SGD Investment Grade Corporate Bond ETF, ABF Singapore Bond Index ETF and Xtrackers II Singapore Government Bond UCITS ETF have clocked an average total return of 5.4% in the YTD, bringing their one-year total return to 10.1%.  Best-Yielding ETFs with Highest YTD Net Inflows
Among the ETFs that saw the highest net inflows in the YTD, Lion-Phillip S-REIT ETF, SPDR® STI ETF and Nikko AM STI ETF offer investors the best yields at 6.0%, 4.7% and 4.6% respectively, based on gross dividends paid over the past 12 months.  The Lion-Phillip S-REIT ETF, rolled out by Lion Global Investors and Phillip Capital Management in October 2017, tracks the Morningstar® Singapore REIT Yield Focus Index. This is the first REIT ETF in the world with Singapore REITs accounting for 100% of its constituents.  There are more than 40 REITs and Property Trusts on SGX with a combined market cap of nearly S$90 billion. REIT popularity is exemplified in multiple ways – they comprise about one-tenth of STI constituents, all of the STI Reserve List stocks, and approximately one-tenth of the total market cap of SGX-listed stocks.  The tables below detail the performance highlights of Singapore-focused ETFs listed on SGX, sorted by YTD net inflows.




Name


Stock Code


YTD Inflows (S$M)


YTD Total Return (%)


1Y Total Return (%)


3Y Total Return (%)


5Y Total Return (%)




SPDR® STI ETF


ES3


302.2


-20.6


-18.8


-14.0


-13.6




Nikko AM STI ETF


G3B


48.4


-21.2


-19.6


-14.8


-14.7




Nikko AM SGD Investment Grade Corporate Bond ETF


MHB


30.7


0.8


4.7


NA


NA




Lion-Phillip S-REIT ETF


CLR


24.8


-16.8


-7.5


NA


NA




ABF Singapore Bond Index ETF


A35


18.9


7.8


13.0


16.7


22.7




Xtrackers MSCI Singapore UCITS ETF^


O9A


-2.5


-24.4


-18.5


-8.6


-14.4




Xtrackers II Singapore Government Bond UCITS ETF^


KV4


-4.3


7.6


12.5


16.3


23.2








Name


Stock Code


Fund Size (S$M)


12M Div Yld (%)


Expense Ratio (%)


Asset Class


Benchmark




SPDR® Straits Times Index ETF


ES3


959


4.7


0.3


Equities


Straits Times Index




Nikko AM STI ETF


G3B


301


4.6


0.3


Equities


Straits Times Index




Nikko AM SGD Investment Grade Corporate Bond ETF


MHB


522


2.0


0.3


Bonds


iBoxx SGD NonSovereigns Large Cap Investment Grade Index




Lion-Phillip S-REIT ETF


CLR


155


6.0


0.6


REITs


Morningstar® Singapore REIT Yield Focus Index




ABF Singapore Bond Index ETF


A35


946


2.0


0.3


Bonds


iBoxx ABF Singapore Bond Index




Xtrackers MSCI Singapore UCITS ETF^


O9A


43


0.0


0.5


Equities


MSCI Singapore Investable Market Total Return Net Index




Xtrackers II Singapore Government Bond UCITS ETF^


KV4


137


0.0


0.2


Bonds


Citi Singapore Government Bond Index




Source: SGX (data as of 14 May 2020)
^Dividends are reinvested  Investing in ETFs
ETFs are investment funds listed and traded intraday on a stock exchange. The majority aim to track the performance of an index and provide access to a wide variety of markets and asset classes, including local stocks, international securities, bonds, commodities or money markets.  Each ETF gives investors access to the performance of the asset that comprises the underlying index. Investing in the ETF is also less costly if one was to build a similar portfolio by buying the individual stocks. It also provides exposure to international markets and asset classes that may be inaccessible to individual investors.
Investors can also invest in the STI ETFs using a Regular Shares Saving Plan (RSS). Click&nbsp;here&nbsp;to find out more.  To find out more about ETFs, visit here.&nbsp;&nbsp;



YTD Performance Highlights of Singapore-Focused ETFs

United States

iShares MSCI Singapore ETF is an exchange-traded fund incorporated in the USA. The ETF's objective seeks to provide investment results that correspond to the performance of the Singaporean market, as measured by the MSCI Singapore 25/50 Index. The ETF invests in a representative sample of index stocks using a "portfolio sampling" technique. SGX Trading Name: IS MSCI SIN 100US$

iShares MSCI Singapore ETF (EWS US)

YTD Performance Highlights of Singapore-Focused ETFs

In the 2020 YTD, Singapore-focused ETFs listed on SGX have seen net inflows of S$418 million, as investors seek attractive valuations and...

Singapore Exchange Ltd (SGX)