The investment objective of the Fund is to replicate as closely as possible, before expenses, the performance of the Straits Times Index (STI), or upon the Manager giving three (3) months' prior written notice to the Trustee and the Holders, such other index which tracks the performance of Singapore listed equity securities.
The Straits Times Index is compiled and calculated by FTSE International Limited and represents the top 30 companies listed on the SGX-ST Mainboard ranked by full market capitalisation.
* Distributions are not guaranteed and are at the absolute discretion of the Manager.
^ Usual brokerage and handling charges to apply. Please refer to the Fund Prospectus for complete information on the Fund, relevant disclosures and fees payable.
# The Manager has reduced the cap on the total expense ratio of the Fund to 0.25% per annum of the Deposited Property with effect from 1 December 2023. Any fees and expenses that are payable by the Fund and are in excess of 0.25% per annum of the Deposited Property will be borne by the Manager and not the Fund.
The STI is a market value weighted index comprising the top 30 main-board listed companies based on their market capitalisation on the Singapore Exchange (SGX-ST). The Index is calculated by FTSE, in partnership with Singapore Press Holdings and Singapore Exchange. The STI is widely followed by investors as the benchmark for the Singapore equities market.
A liquidity review of the Index constituents is conducted semi-annually in March and September by the index provider. In addition, a constituent review, free float review and share in issue review of the Index constituents are conducted quarterly in March, June, September and December by the index provider.
For more information on the description of the index methodology and the latest information relating to the Index, please refer to www.ftse.com/products/indices/SGX-ST.
1. Good proxy to Singapore economy
Comprising of the top 30 largest and most liquid companies listed on the Singapore Exchange, the Index is a good proxy of the Singapore economy.
Singapore consistently outranks the world as one of the cities with best investment potential. In its BERI Report 2016-I (April 2016), US-based research institute Business Environment Risk Intelligence (BERI) ranked Singapore first out of 50 major investment destinations in a ranking that assesses operations, politics and foreign exchange. With no restrictions on the repatriation of profits and the import of capital, along with the most favourable operating conditions and strong diplomatic ties, Singapore’s stable political and economic climate creates an ideal environment to invest in1.
1 https://www.edb.gov.sg/content/edb/en/why-singapore/about-singapore/facts-and-rankings/rankings.html
2. Diversified portfolio
The Index is also a well-diversified benchmark. Apart from a balance of different sectors within the Index, there is also a mix of companies that are both domestic and regionally focused. In recent financial years, as much as 46% of the revenue associated with the STI was reported to have derived from the Asia Pacific region outside of Singapore2.
2 http://www.businesstimes.com.sg/magazines/inside-invest-aug-2017/straits-times-index-5-must-know-facts
3. Attractive dividend yield
Compared to an average of 2.5% for the FTSE indices of China, Japan, India, Hong Kong, Indonesia, Malaysia and Thailand, the Index, with a dividend yield of 3.1% (as of 31 October 2017)3 has one of the highest dividend yields across Asia.
3 http://www.ftse.com/Analytics/FactSheets/temp/ec24886c-dbf6-452f-93a6-79590906b501.pdf
| SGD | Return (%) | 3 m | 6 m | 1 yr | 3 yr | 5 yr | Since Inception |
| NAV-NAV | 2.08 | 6.50 | 22.58 | 11.35 | 13.71 | 8.95 | |
| Benchmark | 2.20 | 6.73 | 23.03 | 11.84 | 14.27 | 9.64 |
| Holdings | Weight |
| DBS GROUP HOLDINGS LTD | 24.7 % |
| OVERSEA-CHINESE BANKING CORPORATION LIMITED | 15.6 % |
| UNITED OVERSEAS BANK LIMITED | 11.8 % |
| SINGAPORE TELECOMMUNICATIONS LIMITED | 7.8 % |
| SINGAPORE TECHNOLOGIES ENGINEERING LTD | 3.3 % |
| Holdings | Weight |
| CAPITALAND INTEGRATED COMMERCIAL TRUST | 3.2 % |
| SINGAPORE EXCHANGE LTD. | 3.2 % |
| JARDINE MATHESON HOLDINGS LIMITED | 3.1 % |
| SINGAPORE AIRLINES LTD. | 2.7 % |
| KEPPEL LTD. | 2.6 % |
| Sector Allocation | Sector Allocation |
|---|---|
| Financials | 55.2 |
| Industrials | 15.5 |
| Real Estate | 14.7 |
| Communication Services | 7.8 |
| Consumer Staples | 3.0 |
| Utilities | 1.6 |
| Others | 1.9 |
| Cash and/or Derivatives | 0.1 |
Exchange Traded Funds have grown in popularity, but what exactly is an ETF? What are some of the benefits of ETFs? What are the different types of ETFs? Watch this video that breaks it down for you in an easy to understand format.
#The Fund is included under the CPFIS - Ordinary Account and has been classified by the CPF Board under the Higher Risk - Narrowly Focused - Country - Singapore.
SRS is a voluntary savings scheme to encourage individuals to save for retirement while reducing taxable income.
Invest in the ETF on a regular basis with:
(*transaction fees or charges may apply with the respective parties below)
Subscribe directly to the ETF through any of our participating dealers, subject to minimum unit requirements stated below.
For subscription of new units in the ETF using the cash option, investors need to go through an authorised participating dealer and a minimum of 50,000 units is required.
For subscription of new units in the ETF using the in-kind option, investors need to go through an authorised participating dealer and a minimum of 500,000 units or multiples of 500,000 is required.
Exchange Traded Funds or “ETFs” are professionally managed investment funds that typically invests in a diversified basket of stocks or bonds that track the performance of a specific index. For example, the Straits Time Index or “STI”[1].
1 The STI tracks the performance of the top 30 companies by market capitalization that are listed on the Singapore Exchange
While most ETFs passively track an index, there are some ETFs that are also actively managed.
Just like stocks, you can trade ETFs on a stock exchange at any point during market hours.
In a nutshell, ETFs offer the best of both worlds, where you have the diversification provided by a fund combined with the tradability of a stock, which can be bought and sold whenever the stock market is open.
For the rest of this FAQ section, unless otherwise specified, the term “ETF” will be used in reference only to passively managed ETFs and not actively managed ones.
As ETFs are designed to track a benchmark index and closely replicate the performance of the index, it will hold substantially all its assets in index securities in the same approximate proportion as their weightings within the index. For example, if DBS represents 20% of the STI, an ETF designed to track the STI would aim to hold 20% of the fund’s assets in DBS shares.
The ETF then issues units to investors, who can buy and sell these units on the stock exchange. The price of an ETF share is determined by the net asset value (NAV) of the underlying assets it holds.
No, ETFs can represent various asset classes, not just stocks. Other asset classes include (but are not limited to) bonds, REITs, commodities etc.
As ETF units are traded on stock exchanges, so you can buy or sell them through a brokerage account, just like you would trade individual stocks during trading hours. You place an order with your broker specifying the number of units you want to buy or sell.
ETFs and unit trusts are both investment vehicles, but they differ mainly in 2 ways:
Some ETFs pay distributions, especially those that include dividend-paying stocks or income-generating assets like bonds. Distributions are typically made to ETF unit holders on a periodic basis.
Yes, brokers may offer distribution reinvestment plans (DRIPs). With a DRIP, you can automatically reinvest your ETF distributions by purchasing additional units, thereby compounding your investment over time.
Yes, ETFs can be suitable for long-term investing. They can offer broad market exposure, diversification, and the potential for steady growth. However, it's important to choose ETFs that align with your investment goals and risk tolerance.
As with any investment, there are risks associated with ETFs. As an ETF takes on the risks of the assets it invests into, its net asset value fluctuates with the valuation of these underlying assets, and there is always a possibility of loss. However, ETFs are generally considered to be lower risk compared to individual stocks due to their diversified nature. Do note a passively managed ETF cannot respond to market movements like an actively-managed fund. For example, portfolio manager of an actively-managed fund can adopt defensive measures like reducing securities holdings during periods of volatility or in the face of impending bear market, but a passive ETF will continue to track its index in its securities holdings.
Please note that while this information provides a general understanding of ETFs, it's always important to do thorough research, consult with a financial advisor, and read the specific prospectus and documentation of any ETF you consider investing in.
The funds mentioned are Singapore registered funds approved for sale or purchase in Singapore. By proceeding, you are representing and warranting that you are either resident in Singapore or the applicable laws and regulations of your jurisdiction allow you to access the information.
This document is purely for informational purposes only with no consideration given to the specific investment objective, financial situation and particular needs of any specific person. It should not be relied upon as financial advice. Any securities mentioned herein are for illustration purposes only and should not be construed as a recommendation for investment. You should seek advice from a financial adviser before making any investment. In the event that you choose not to do so, you should consider whether the investment selected is suitable for you. Investments in funds are not deposits in, obligations of, or guaranteed or insured by Nikko Asset Management Asia Limited (“Nikko AM Asia”).
Past performance or any prediction, projection or forecast is not indicative of future performance. The Fund or any underlying fund may use or invest in financial derivative instruments. The value of units and income from them may fall or rise. Investments in the Fund are subject to investment risks, including the possible loss of principal amount invested. You should read the relevant prospectus (including the risk warnings) and product highlights sheet of the Fund, which are available and may be obtained from appointed distributors of Nikko AM Asia or our website (www.nikkoam.com.sg) before deciding whether to invest in the Fund.
The information contained herein may not be copied, reproduced or redistributed without the express consent of Nikko AM Asia. While reasonable care has been taken to ensure the accuracy of the information as at the date of publication, Nikko AM Asia does not give any warranty or representation, either express or implied, and expressly disclaims liability for any errors or omissions. Information may be subject to change without notice. Nikko AM Asia accepts no liability for any loss, indirect or consequential damages, arising from any use of or reliance on this document. This advertisement has not been reviewed by the Monetary Authority of Singapore.
The performance of the ETF’s price on the Singapore Exchange Securities Trading Limited (“SGX-ST”) may be different from the net asset value per unit of the ETF. The ETF may also be suspended or delisted from the SGX-ST. Listing of the units does not guarantee a liquid market for the units. Investors should note that the ETF differs from a typical unit trust and units may only be created or redeemed directly by a participating dealer in large creation or redemption units.
The Central Provident Fund (“CPF”) Ordinary Account (“OA”) interest rate is the legislated minimum 2.5% per annum, or the 3-month average of major local banks' interest rates, whichever is higher, reviewed quarterly. The interest rate for Special Account (“SA”) is currently 4% per annum or the 12-month average yield of 10-year Singapore Government Securities plus 1%, whichever is higher, reviewed quarterly. Only monies in excess of $20,000 in OA and $40,000 in SA can be invested under the CPF Investment Scheme (“CPFIS”). Please refer to the website of the CPF Board for further information. Investors should note that the applicable interest rates for the CPF accounts and the terms of CPFIS may be varied by the CPF Board from time to time.
The units of Nikko AM Singapore STI ETF are not in any way sponsored, endorsed, sold or promoted by FTSE International Limited ("FTSE"), the London Stock Exchange Plc (the "Exchange"), The Financial Times Limited ("FT") SPH Data Services Pte Ltd ("SPH") or Singapore Press Holdings Ltd ("SGP") (collectively, the "Licensor Parties") and none of the Licensor Parties make any warranty or representation whatsoever, expressly or impliedly, either as to the results to be obtained from the use of the Straits Times Index ( "Index") and/or the figure at which the said Index stands at any particular time on any particular day or otherwise. The Index is compiled and calculated by FTSE. None of the Licensor Parties shall be under any obligation to advise any person of any error therein.
"FTSE®", "FT-SE®" are trade marks of the Exchange and the FT and are used by FTSE under license. "STI" and "Straits Times Index" are trade marks of SPH and are used by FTSE under licence. All intellectual property rights in the ST index vest in SPH and SGP.
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