Opportune time for investing in ETFs: analysts
by Sim Ping Khuan Updated 12:17 AM Jul 12, 2012Sim Ping Khuan
SINGAPORE - The turnover of exchange-traded funds (ETFs) fell 56 per cent on-year to S$350 million in June, according to the Singapore Exchange, taking the full-year ETF turnover for the full year ended June down 23 per cent to S$7.3 billion.
Experts say the drop in Singapore's ETF turnover in June reflects the global economic uncertainty and tracks declines in equity trading across the region, with investors holding back on riskier assets.
With valuations for equities looking attractive now, it may be an opportune time for investors to enter the ETF market, they say.
Mr Nels Friets, Head of Securities at Singapore Exchange, said: "You're seeing probably more people buying and holding, as opposed to trading, so then that's why assets under management continues to increase -- as opposed to the trading volumes. ETFs are a very important part of most investors' portfolios and should remain that way."
Globally, ETF assets have increased by 11.1 per cent to US$1.5 trillion from US$1.35 trillion in the first half of the year, according to a London-based independent ETF research and consultancy firm ETFGI.
Mr Hon Cheung, Regional Director for Asia at State Street Global Investors, said:
"The assets under management for the Singapore Exchange ETFs over the last six months grew by 29 per cent. So there's obviously significant investment interest out there. I think ETFs fulfill the role of providing very cost effective, simple, transparent access to markets."
Analysts say key factors that will drive growth in ETF trading in Singapore are the breadth of the ETF assets available, the transparency of the products, and the cost-effectiveness in gaining exposure to diversified markets.
Last month, SGX launched dual currency trading for ETFs, allowing investors to trade in seven US dollar-denominated ETFs in Singapore dollars.
The move, analysts say, will help to remove a significant psychological barrier, as some investors believe that ETF trading carries an additional risk of currency exposure.
Mr Roger Tan, CEO of SIAS Research, said: "Investors do not need to see it as a US dollar investment, they can see it as an ETF investment and focus on what the product is really about."
Selected products such as gold ETFs have remained popular among investors.
Turnover of gold ETF SPDR Gold Shares, the first commodity-based ETF listed on Singapore Exchange, has increased by 60 per cent in the past 12 months, according to State Street Global Advisors, which manages the fund.
Source/Extract/Excerpts/来源/转贴/摘录: TODAYonline
Publish date: 12/07/12
by Sim Ping Khuan Updated 12:17 AM Jul 12, 2012Sim Ping Khuan
SINGAPORE - The turnover of exchange-traded funds (ETFs) fell 56 per cent on-year to S$350 million in June, according to the Singapore Exchange, taking the full-year ETF turnover for the full year ended June down 23 per cent to S$7.3 billion.
Experts say the drop in Singapore's ETF turnover in June reflects the global economic uncertainty and tracks declines in equity trading across the region, with investors holding back on riskier assets.
With valuations for equities looking attractive now, it may be an opportune time for investors to enter the ETF market, they say.
Mr Nels Friets, Head of Securities at Singapore Exchange, said: "You're seeing probably more people buying and holding, as opposed to trading, so then that's why assets under management continues to increase -- as opposed to the trading volumes. ETFs are a very important part of most investors' portfolios and should remain that way."
Globally, ETF assets have increased by 11.1 per cent to US$1.5 trillion from US$1.35 trillion in the first half of the year, according to a London-based independent ETF research and consultancy firm ETFGI.
Mr Hon Cheung, Regional Director for Asia at State Street Global Investors, said:
"The assets under management for the Singapore Exchange ETFs over the last six months grew by 29 per cent. So there's obviously significant investment interest out there. I think ETFs fulfill the role of providing very cost effective, simple, transparent access to markets."
Analysts say key factors that will drive growth in ETF trading in Singapore are the breadth of the ETF assets available, the transparency of the products, and the cost-effectiveness in gaining exposure to diversified markets.
Last month, SGX launched dual currency trading for ETFs, allowing investors to trade in seven US dollar-denominated ETFs in Singapore dollars.
The move, analysts say, will help to remove a significant psychological barrier, as some investors believe that ETF trading carries an additional risk of currency exposure.
Mr Roger Tan, CEO of SIAS Research, said: "Investors do not need to see it as a US dollar investment, they can see it as an ETF investment and focus on what the product is really about."
Selected products such as gold ETFs have remained popular among investors.
Turnover of gold ETF SPDR Gold Shares, the first commodity-based ETF listed on Singapore Exchange, has increased by 60 per cent in the past 12 months, according to State Street Global Advisors, which manages the fund.
Source/Extract/Excerpts/来源/转贴/摘录: TODAYonline
Publish date: 12/07/12
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