SGX Market Updates

ETF Trading Enhancements Commence 17 Jan

SGX
Publish date: Wed, 22 Dec 2021, 08:37 AM
  • 2021 was a watershed year for SGX-listed ETFs. The combined AUM surged more than 40% as of 30 Nov, with the offering expanding 17% from 30 ETFs to 35 ETFs. During the 11 months, XT Vietnam and SPDR S&P500 averaged a 33% total return, while XT MSCHINA and Lion-OCBC Sec HSTECH S$ averaged a 23% decline in total return.
     
  • On 17 Jan, the board lot size of all SGX-listed ETFs will be reduced to 1 unit, supported in part by the significant growth in dollar cost averaging. The trade size flexibility that is an essential aspect of dollar cost averaging, has also been enabled by tighter bid/offer quotes provided by market makers and investors in 2021.
     
  • Another enhancement for the SGX-listed ETF trading effective 17 Jan, will see greater price flexibility in the placing of limit buy and sell orders. The standard +/- 30 tick range above/below the last reference price for sell/buy limit orders will be revised to +/- 10% above/below the last reference price.    

     

A Watershed Year for ETF Markets

For the first 11 months of 2021, ETFs and ETPs listed globally saw a record US$1.14 trillion in net inflow. This saw their global assets under management (“AUM”) increase from US$7.99 trillion at the end of 2020, to US$9.92 trillion at the end of November 2021 (for the full ETFGI report click here).

As this year marks 20 years since ETFs were listed on SGX, we have seen the combined AUM of SGX-listed ETFs surge 41% as of 30 Nov, with the product offering expanding 17% from 30 ETFs to 35 ETFs. The combined AUM of the Singapore-listed ETFs has surged to S$1.2 billion, with as many as five ETFs maintaining AUMs above S$1.0 billion. The five ETFs are the iShares Barclays USD Asia High Yield Bond Index ETF, ICBC CSOP FTSE Chinese Government Bond ETF, SPDR Straits Times Index ETF, SPDR GLD ETF and ABF Singapore Bond Index Fund. Meanwhile, the five ETFs that have listed in 2021 include the CSOP iEdge S-REIT Leaders Index ETF, Lion-OCBC China Leaders ETF, the UOB APAC Green REIT ETF, and the Phillip MSCI Singapore Daily (2x) Leveraged and Phillip MSCI Singapore Daily (-1x) Inverse Products. Note that unlike conventional ETFs, Leveraged and Inverse (L&I) products aim to track a multiple or opposite of the daily return of its underlying index (click here for more).


Market Enhancements Effective 17 January 2022

On 17 January 2022, two significant changes will take effect in the Singapore ETF market. The first change will see the board lot size of all SGX-listed ETFs reduced to 1 unit, supported in part by the significant growth in dollar cost averaging.

The trade size flexibility that is an essential aspect of dollar cost averaging, has also been enabled by tighter bid/offer quotes provided by market makers and investors in 2021. The top 10 traded ETFs in the first 11 months of 2021 saw an average year on year reduction of 33% in bid-ask spreads for top of order book and 28% average reduction in bid-ask spreads for market depth of S$50,000.

 

Top 10 Traded ETFs in 2021 YTD

Stock Code

2021 YTD Traded Value S$M

Avg Spreads

in 2021

Avg Spreads in 2020

% Spreads Reduction

Avg spreads for
$50K depth in 2021

Avg spreads for
$50K depth

in 2020

% Spreads Reduction for S$50k depth

STI ETF

ES3

1,081

6.2

13.4

-54%

11.7

18.7

-38%

Lion-OCBC Sec HSTECH US$

HST

628

17.7

22.3

-21%

31.2

34.4

-9%

GLD US$

O87

602

6.0

6.4

-7%

6.6

7.5

-12%

IS ASIA HYG US$

O9P

563

20.4

42.0

-51%

27.6

60.6

-54%

Nikko AM STI ETF

G3B

469

33.4

49.0

-32%

35.6

54.6

-35%

NikkoAM-STC Asia REIT

CFA

297

16.9

29.8

-43%

28.8

39.6

-27%

NikkoAM SGD IGBond ETF

MBH

176

12.7

23.0

-45%

18.6

30.0

-38%

ICBC CSOP CGB ETF US$D

CYB

145

16.5

16.1

3%

17.0

16.8

2%

ABF SG BOND ETF

A35

135

11.4

20.6

-45%

16.6

27.1

-39%

LION-PHILLIP S-REIT

CLR

134

19.0

30.1

-37%

32.2

43.1

-25%

Average Improvement

 

 

 

 

-33%

 

 

-28%

Source: SGX, Refinitiv, Bloomberg (Data as of 30 November 2021)

The second enhancement for the SGX-listed ETFs will see greater price flexibility in the placing of limit buy and sell orders with a change to the forced order range. The standard +/- 30 tick range above/below the last reference price for sell/buy limit orders will be revised to +/- 10% above/below the last reference price.    

 

Top 10 Traded ETFs in 2021 YTD

Stock Code

Current Lot Size

Example of Current $ Minimum

trade size1

Example of Minimum

$ trade size effective

17-Jan-221

Minimum

Bid Size

Current Forced Order Range in %1

New Forced Order Range in %

STI ETF

ES3

10

31.48

3.15

0.001

1.0%

10%

Lion-OCBC Sec HSTECH US$

HST

10

10.13

1.01

0.001

3.0%

10%

GLD US$

O87

5

826.55

165.31

0.01

0.2%

10%

IS ASIA HYG US$

O9P

5

42.9

8.58

0.01

3.5%

10%

Nikko AM STI ETF

G3B

10

31.8

3.18

0.01

9.4%

10%

NikkoAM-STC Asia REIT

CFA

10

10.93

1.09

0.001

2.7%

10%

NikkoAM SGD IGBond ETF

MBH

10

10.38

1.04

0.001

2.9%

10%

ICBC CSOP CGB ETF US$D

CYB

10

109.2

10.92

0.01

2.7%

10%

ABF SG BOND ETF

A35

10

11.62

1.16

0.001

2.6%

10%

LION-PHILLIP S-REIT

CLR

100

107

1.07

0.001

2.8%

10%

Source: SGX, Refinitiv, Bloomberg (Data as of 30 November 2021)
1Based on last traded price on 3-Dec-2021
 

Board lot size of ETFs listed on SGX will be reduced to 1 unit

Currently, Singapore-listed ETFs maintain different board lot sizes ranging from 5 units to 100 units. Effective, 17 January 2022, the board lot size of ALL ETFs listed on SGX will be reduced to 1 unit, providing added flexibility for portfolio management. For instance, based on a unit price of US$459.07 on 3 December, the SPDR S&P 500 US$ ETF (S27) is traded in multiples of US$4,590.70 based on a board lot size of 10 units. Effective 17 January 2022, the minimum trade size for SPDR S&P 500 US$ ETF will be traded in multiples of US$459.07 based on the NEW board lot size of 1 unit, assuming the 3 December unit price of US$459.07. This reduces the minimum trade size per board lot by as much as 90%. It also means that an investor who wishes to allocate US$12,000 into the ETF can purchase 26 units with a total value of US$11,935.82, instead of a less flexible purchase of 20 units at US$9,181.40 or 30 units at US$13,772.10.

Existing Forced Order Range of +/- 30 ticks will be revised to +/- 10%

The ‘forced order’ key provides an alert when the price of an order is beyond the forced order range. It is a pre-execution mechanism and does not block orders. Market participants can still 'force' an order through at a price which lies outside the forced order range through their respective brokers. This aspect of the order process is managed between the broker and investor. However, with this enhancement, investors can place limit orders within +/- 10% of last reference price without triggering the forced order key, as opposed to the current bounds of +/- 30 ticks from the last reference price.  This will see greater price flexibility in the placing of limit buy and sell orders.

For instance, assuming a price of S$3.00, the force order range for STI ETF (ES3) is 30 ticks which equates to +/- 1.0% from its last reference price. Effective 17 January 2022, the force order range for STI ETF will be +/- 10% from its last reference price. This will provide for flexibility in the placement of limit buy and sell orders to both investors and day traders.
 

ETFs are investment funds listed and traded intraday on a stock exchange. The majority aim to track the performance of an index and provide access to a wide variety of markets and asset classes, including local stocks, international securities, bonds, commodities or money markets. Each ETF gives investors access to the performance of the asset which comprises of the underlying index. Investing in the ETF is also less costly if one were to build a similar portfolio by buying the individual stocks. These portfolio products also provide exposure to international markets and asset classes that may be inaccessible to individual investors.

The 35 ETFs listed on SGX, sort by highest returns for the first 11 months of 2021 are tabled below.

ETF Name

Primary Code

Sec. Code

Issuer

Total Expense Ratio %

Fund Focus

2021 to 30 Nov Total Return % [SGD]

2021 to 30 Nov Inflow/ Outflow

S$M

AUM S$M as of Nov 2021

Xtrackers FTSE Vietnam Swap UCITS ETF

HD9

 

XTrackers

0.85

Vietnam Equities

37.1

2

20

SPDR S&P 500 ETF

S27

 

SSGA

0.09

US Equities

28.6

16

69

Lyxor MSCI India UCITS ETF - Acc USD

G1N

 

Lyxor

0.85

India Equities

25.4

-  

15

iShares MSCI India Index ETF

I98

QK9

Blackrock

1.03

India Equities

23.9

-  

139

SPDR®  DJIA ETF TRUST

D07

 

SSGA

0.17

US Equities

19.4

-  

4

SPDR® Straits Times Index ETF

ES3

 

SSGA

0.3

SG Equities

10.7

 (145)

1,575

NikkoAM-ICBCSG China Bond ETF RMB Class

ZHY

ZHD

Nikko AM

0.3

China RMB Bonds

10.3

11

252

ICBC CSOP FTSE Chinese Government Bond ETF

CYC

CYB

CSOP AM

0.25

China RMB Bonds

10.3

306

1,986

NikkoAM-ICBCSG China Bond ETF SGD Class

ZHS

 

Nikko AM

0.3

China RMB Bonds

10.1

20

68

Nikko AM Singapore STI ETF

G3B

 

Nikko AM

0.3

SG Equities

9.9

66

576

Xtrackers MSCI Singapore UCITS ETF

O9A

 

XTrackers

0.5

SG Equities

8.1

 (2)

14

Phillip APAC DIV REIT Leader ETF

BYI

BYJ

Phillip

0.91

APAC REITs

7.6

 (4)

19

Phillip Sing Income ETF

OVQ

 

Phillip

0.97

SG Equities

5.7

3

63

Principal FTSE ASEAN40 ETF

M62

QS0

PAM

0.8

ASEAN Equities

3.6

 (9)

11

Xtrackers MSCI Indonesia Swap UCITS ETF

KJ7

 

XTrackers

0.65

Indonesia Equities

3.1

 (1)

19

iShares Asia Credit ETF

N6M

QL2

Blackrock

0.2

Asia USD Bonds

2.6

26

107

Lion-Phillip S-REIT ETF

CLR

 

LGI

0.6

Singapore REITs

2.1

49

235

NikkoAM-StraitsTrading Asia ex Japan REIT ETF

CFA

COI

Nikko AM

0.6

Asia REITs

1.0

86

328

Phillip SGD Money Market ETF

MMS

MMT

Phillip

0.24

SGD Bonds

0.2

 (5)

116

Nikko AM SGD Investment Grade Corporate Bond ETF

MBH

 

Nikko AM

0.3

SGD Bonds

(0.8)

16

600

Lyxor MSCI AC Asia Pacific Ex Japan UCITS ETF - USD

P60

 

Lyxor

0.6

APAC Equities

(1.8)

0

26

SPDR GLD ETF

O87

GSD

SSGA

0.4

Gold

(2.1)

(132)

1,363

Lyxor MSCI Emerging Markets UCITS ETF - Acc USD

H1N

 

Lyxor

0.55

EM Equities

(2.5)

2

7

Principal S&P APAC Dividend ETF

P5P

QR9

PAM

1.06

APAC Equities

(4.1)

4

22

Xtrackers II Singapore Government Bond UCITS ETF

KV4

 

XTrackers

0.2

SGD Bonds

(4.6)

(2)

128

ABF Singapore Bond Index Fund

A35

 

Nikko AM

0.25

SGD Bonds

(5.1)

109

1,052

UNITED SSE 50 CHINA ETF

JK8

 

UOBAM

2.28

China Equities

(6.6)

2

28

iShares Barclays USD Asia High Yield Bond Index ETF

O9P

QL3

Blackrock

0.5

Asia USD Bonds

(9.0)

2,447

2,523

Lyxor MSCI China ESG Leaders Extra (DR) UCITS ETF

P58

 

Lyxor

0.65

China Equities

(18.1)

(3)

30

Xtrackers MSCI China UCITS ETF

LG9

TID

XTrackers

0.65

China Equities

(18.8)

35

67

Lion-OCBC Securities Hang Seng TECH ETF

HST

HSS

LGI

0.68

China Equities

(26.6)

268

287

Lion-OCBC China Leaders ETF*

YYY

YYR

LGI

0.62

China Equities

N/A

84

87

CSOP iEdge SREIT Leaders Index ETF*

SRT

SRU

CSOP AM

0.6

Singapore REITs

N/A

113

113

UOB APAC Green REIT ETF*

GRN

GRE

UOBAM

0.8

APAC REITs

N/A

-   

83

Total (All)

 

 

 

 

 

 

3,285

12,111

Source: SGX, Refinitiv, Bloomberg (Data as of 30 November 2021)

* New Listings in 2021
 

To find out more about ETFs, click here. 

Discussions
Be the first to like this. Showing 0 of 0 comments

Post a Comment