The Best Singapore-Based ETFs That You Can Get Into In 2020
The investment segment in Singapore is currently doing well, and investors are looking for ways to invest their money while significantly reducing the risks involved or where they do not have to do much. The markets have been enjoying relative stability, which subsequently makes Exchange Traded Funds (ETFs) quite attractive to investors.
Investors have been reaping significant returns from ETFs over the past year despite the declining performance of the Strait Times Index (STI) and the fact that it was not the best year for ETFs. Singapore maintained its status as one of the countries that offer the best returns form ETFs. The segment, therefore, remains lucrative, and analysts expect good returns to continue over the next one year.
2019 is almost over, and 2020 is rapidly drawing closer. This means that investors are looking for investments that will deliver solid returns in the coming year, particularly in the ETFs segment. If you are interested in these types of investments, here are some of the ETFs that you should consider investing in in 2019, that are likely to deliver attractive returns.
- Nikko AM Singapore STI ETF
This is currently one of the most popular ETFs in Singapore, particularly due to its investment approach, which tries to mimic the performance of the FTSE STI index. It is also one of the ideal ETFs in Singapore for any investor that is looking for a low-cost option. Nikko AM Singapore STI ETF invests most of its assets in index shares. This makes it an attractive option for investors that are after optimized capital gains and dividend distribution.
This ETF is also an ideal solution for investors that want to tap into the stock market reliably and affordably. Its expense ratio is roughly 0.35%, and it pays out dividends twice a year. Nikko AM Singapore STI ETF’s average rate of return for the last three years was 11.65% with a 3.5% annual dividend return.
- SPDR STI ETF
It is considered one of Singapore’s best ETFs because it offers attractive returns. It is an ideal ETF for investors new to investing and for those looking for steady returns. Its performance is based on the performance of an STI listing that consists of the top 30 publicly listed companies in Singapore.
The fact that it keeps track of 30 of Singapore’s major companies is good news for investors because it means they will benefit from exposure to major companies such as CapitaLand, DBS OBC, and Singtel. This means that the SPDR STI ETF provides a way for investors to invest in these major companies without having to purchase the stock directly. It also provides exposure to companies that have their operations in emerging markets in Asia, such as Indonesia and Malaysia.
SPDR STI ETF also boasts of an impressive track record that spans more than a decade. It has been offering its investors an annual return rate of roughly 3.8% since 2002, and this is exclusive of the dividends. The total rate of returns, including the dividends during the same period, is around 7%, which means it is one of the Singapore-based ETFs that offer the highest returns. It is, therefore, ideal for the investors that want to double their investment every decade. It also charges low expenses, especially compared to most of the other ETFs in the market, thus helping investors to optimize their returns.
- Ishares MSCI Singapore ETF
This ETF is ideal for investors that are looking for exposure to Singapore securities. This is because it focuses on mid-sized and large-cap firms in the country, and it achieves this through the MSCI Singapore index. The ETF manages assets worth almost $800 million through which it charges roughly 49 basis points every year.
Ishares MSCI Singapore ETF’s portfolio largely includes financial assets, which are 39.3% of the total investment, while real estate companies follow closely at 21.4%. The industrial segment is 18% of the total investment. Some of the major holdings include companies like DBS Group Holdings, United Overseas Bank Ltd, and Oversea-Chinese Bank Ltd.
Its portfolio makes it the ideal investment for any investor that wants to get exposure to the real estate, financial, and industrial segments. It is among the ETFs that offer the highest returns considering that it delivered an average annual rate of returns at 48.8% for the past three years. Its annualized returns for the past five years were 26.5%, while its annual dividends ranged at around 5.08%.
- ABF Singapore Bond Index Fund
Here is yet another Singapore-based ETF that has also achieved massive success in the last few years. It managed assets worth S$869 million in 2017, an indicator of just how much success it is. It is the ideal ETF for any investor that is risk-averse because it focuses on low-risk assets, therefore ensuring that investors are protected while at the same time providing significant returns. It is also one of Singapore’s low-cost ETFs, thereby allowing investors to optimize their returns. It has demonstrated significant momentum over the past few months, and if it maintains that trend, then that makes it an ideal investment opportunity.
- Ishares MSCI Korea UCITS Index ETF
This ETF is best-suited for the investors that have a high-risk appetite, and this may be a disadvantage to some. It is considered a high-risk investment because it tracks securities from an emerging market. It is, therefore, not ideal for many, but if you are an investor that likes to expand your investments to foreign markets, then you might want to consider it.
The flip side is that it offers opportunities for strong returns, especially considering that it provides exposure to major Korean stocks such as Hyundai, LG, and Samsung, which are currently among the top brands globally. This means that you can tap into the huge growth margins that are offered by those firms.
- Global X Southeast Asia ETF
This is another Singapore-based ETF that invests in foreign markets, thereby providing exposure to real estate firms not only in Singapore but also in China, South Korea, Australia, Vietnam, and Malaysia. It is one of the better performing ETFs with an average of 5.02% annual returns since it was launched. It also boasts of the lowest expense ratio at just 0.3%, which allows investors to maximize their earning potential fully.