• On 6 August, the combined Assets under Management (“AUM”) of 31 Singapore-listed ETFs surpassed S$10 billion, effectively doubling over a two year period. Issued by 10 different Fund Managers, the 31 ETFs provide investors with exposure to multiple asset classes in Singapore and across the globe.     
   
• The 8 Fixed Income ETFs currently contribute 48% of the combined S$10 billion ETF AUM, while the 19 Equity Index REITs contribute 32% of the AUM with the Gold ETF contributing 14% of the AUM and 3 REIT ETFs contributing 6% of the ETF AUM.
   
• The five ETFs that were recipient to the most inflows in the 2021 year through to 6 August were the ICBC CSOP FTSE Chinese Government Bond ETF, iShares Barclays USD Asia High Yield Bond Index ETF, Lion-OCBC Securities Hang Seng TECH ETF, NikkoAM-StraitsTrading Asia ex Japan REIT ETF and Lion-OCBC China Leaders ETF.

Singapore first listed Exchange Traded Funds (“ETFs”) 19 years ago in May 2001. Gradually, the combined Assets under Management (“AUM”) of the ETF suite climbed to S$5 billion in August 2019. Two years later, the combined AUM has reached another milestone of S$10 billion.

The first Singapore-listed ETF to cover the Singapore equity market was listed in April 2002, with the SPDR Straits Times Index ETF generating an annualised total return of 6.4% from inception through to 10 August. The annualised total returns of the SPDR Straits Times Index ETF over the past 15 years, 10 years and 5 years were 5.0%, 4.3% and 5.5% respectively. Note the conventional definition for total returns includes changes in the price of the unit in addition to reinvested dividend distributions. The first Singapore-listed ETF to cover the Singapore fixed income market was listed in August 2005, with the ABF Singapore Bond Index Fund generating an annualised total return of 2.8% from inception through to 10 August. By comparison, the annualised total returns of the ABF Singapore Bond Index Fund over the past 15 years, 10 years and 5 years were 3.0%, 2.2% and 2.4% respectively.

ETF inflows generally result from primary market creation of ETF units by the participating dealers to meet the excess demand from institutional and retail investors for the ETFs on the exchange. Outflows, on the other hand, are resulted from primary market redemption due to selling activities of institutional and retail investors in the markets. The two STI ETFs were recipient to S$947 million of inflows in 2020, as the STI declined 11.8%, from 3,222.8 to 2,843.8, and conversely, S$50 million of outflows in the 2021 year to 6 August, as the STI gained 11.7%, from 2,843.8 to 3,177.2. The momentous moves since the end of 2019 were seen to increase the tradability of both STI ETFs and since the end of 2019, with the STI ETFs have tripling their combined average daily turnover observed in the preceding three years of 2016 through to the end of 2019. 

In the 2021 year to 6 August, the five ETFs that were recipient to the most inflows included the CSOP FTSE Chinese Government Bond ETF, iShares Barclays USD Asia High Yield Bond Index ETF, Lion-OCBC Securities Hang Seng TECH ETF, NikkoAM-StraitsTrading Asia ex Japan REIT ETF and Lion-OCBC China Leaders ETF. 

Since the combined AUM of Singapore-listed ETFs surpassed S$5 billion in August 2019, there have been five ETFs launched.  These five ETFs, the ICBC-CSOP FTSE Chinese Government Bond ETF, Phillip SGD Money Market ETF, NikkoAM-ICBC SG China Bond ETF, Lion-OCBC Securities Hang Seng TECH ETF and the Lion-OCBC Securities China Leaders ETF maintain a combined AUM of S$2.9 billion. The ICBC-CSOP FTSE Chinese Government Bond ETF made up S$2.1 billion, or more than 70% of the combined S$2.9 billion.

The AUM and unit inflows/outflows in the 2021 year as of 6 August for each ETF is tabled below.  

** Note the NikkoAM-ICBC SG China Bond ETF has dual class units - SGD (pay dividend) & RMB (accumulating).

Source: SGX, Refinitiv, Bloomberg (Data as of 6 August 2021)

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.

To find out more about ETFs, click here.