Singapore Exchange Limited (SGX) announced today that the value of SGX-listed Exchange Traded Funds (ETF) set new monthly and weekly records last month – just three months after the previous monthly and weekly records were set.
Total trading value of SGX-listed ETFs was S$293.6 million for the month of January 2008. This exceeds the previous record of S$218.4 million traded in the month of October 2007 by 34%.
Total trading value of SGX-listed ETFs was S$128.9 million for the week of 21-25 January 2008. This exceeds the previous record of S$99.6 million traded in the week of 15-19 October 2007 by 29%.
The increased trading was largely due to strong surges in the Straits Times Index (STI) ETF, iShares MSCI India ETF, Lyxor ETF Hong Kong and StreetTRACKS Gold Shares ETF.
"ETFs have become increasingly popular as investors become more aware of its benefits. Two of its key advantages over conventional unit trusts are the flexibility to buy or sell throughout the trading day and lower management fees. In these times of market volatility, investors appreciate this flexibility to make quick decisions to maximise their investments," said Chew Sutat, SGX executive vice president & head of Development.
"We are heartened by the strong interest in the STI ETF, as it is based on the key barometer of our market. SGX is now exploring with issuers ETFs based on the FTSE ST Index Series of indices launched just three weeks ago. This will add to our current suite of both domestic and regional ETFs that investors can trade in."
ETFs are cost-efficient investment funds traded on the exchange that allow investors to gain access and diversification to equity and commodities markets. ETFs can be traded at any time of the trading day at the prevailing market price. This has been increasingly important in times of market volatility, as investors can get in and out of the market at any time and not at the end of the day as in conventional unit trusts.
SGX currently has 17 ETFs covering mainly Asian equity markets such as Singapore, India, Greater China, ASEAN, Korea and Japan and also on commodities, e.g. gold.