Both exchange traded funds (ETF) are traded on Singapore Stock Exchange.
The SPDR Straits Times Index ETF seeks to generate returns that closely correspond to the performance of the Straits Times Index (STI).
This fund invested in 30 FTSE Straits Times Index component stocks at varying percentages of total net assets.
Nikko AM Singapore STI ETF: The investment objective of the Fund is to replicate as closely as possible, before expenses, the performance of the FTSE Straits Times Index.
Both funds select stocks from 30-stock FTSE STI but at different proportions from each other. Their net asset value per unit ratios (NAV per unit) differ from each other. See table below for a comparison.
|SPDR STI ETF *||Nikko AM STI ETF **|
|Inception date||17 Apr 2002||24 Feb 2009|
|Fund size||$379m||$126 m|
|NAV per unit||$3.24||$3.3224|
|Price at 15 Aug||$3.24||$3.30|
|Board lot size||1000||100|
|Dividend distribution||Semi-annually||At least once a year|
* as at 15 August 2013
** as at 30 June 2013/14 August 2013
On 15 August 2013, STI was at 3220.92 points level, Price of SPDR STI ETF was $3.24, Price for Nikko AM Singapore STI ETF was $3.30. NAV per unit for Nikko STI ETF was higher than SPDR STI ETF ($3.3224 vs $3.24).
Fund size for SPDR STI ETF was three times bigger than Nikko’s. SPDR STI ETF was established earlier in 2002 and Nikko’s about seven years later.
Distribution yield for SPDR’s was 2.62% and Nikko’s was 2.14%.
SPDR STI ETF is still treated as Specified Investment Product (SIP) by Monetary Authority of Singapore while Nikko AM Singapore STI ETF is no longer an SIP (non-SIP product). Any retail investor can trade freely on Nikko’s STI ETF without pre-conditions to be eligible to do so. To trade SPDR STI ETF, you will need to be assessed as being eligible to trade in SIP.
In order to get a piece of action on Singapore stocks, both ETFs allow you to do so at a fraction of the costs as opposed to actually owning 30 component stocks of the STI. I am watching STI ETF for price movement and buying more units using SRS money or with cash (when the price is acceptable to me).
Note: POSB introduced Invest-Saver plan recently. At $100 a month, the scheme will invest in Nikko AM Singapore STI ETF for the investors.
Copyright © 2013, limkimtong for Living Investment
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