SPDR® Straits Times Index ETF: Your Gateway to Singapore's Blue-Chip Market

What is the SPDR® Straits Times Index ETF (ST ETF)?

The SPDR® Straits Times Index ETF (ST ETF) is an exchange-traded fund (ETF) that tracks the performance of the Straits Times Index (STI), a benchmark index of the 30 largest and most liquid companies listed on the Singapore Exchange (SGX). The ST ETF provides investors with a convenient and cost-effective way to gain exposure to the Singapore stock market.

Key Features of the ST ETF

• Ticker: STI
• Fund Manager: State Street Global Advisors (SSgA)
• Launch Date: 23 December 2002
• Listing Exchange: Singapore Exchange (SGX)
• Benchmark Index: Straits Times Index (STI)
• Expense Ratio: 0.30% per annum

Benefits of Investing in the ST ETF

• Diversification: The ST ETF offers instant diversification across 30 of Singapore's largest and most established companies, reducing portfolio risk.
• Low Cost: With an expense ratio of just 0.30% per annum, the ST ETF is one of the most cost-effective ways to invest in the Singapore market.
• Transparency: As an ETF, the ST ETF provides transparent and real-time pricing information, giving investors a clear understanding of their investment performance.
• Tax Efficiency: The ST ETF is structured as a unit trust, which may offer tax advantages to investors in certain jurisdictions.

Top 10 Holdings of the ST ETF

Sector Allocation of the ST ETF

Performance of the ST ETF

The ST ETF has consistently outperformed the broader Singapore market over the long term. Since its inception in 2002, the ST ETF has delivered an annualized total return of approximately 6.5%, compared to the STI's 5.2% annualized return.

Risks of Investing in the ST ETF

As with any investment, there are risks associated with investing in the ST ETF, including:

• Market Risk: The ST ETF is subject to the fluctuations of the Singapore stock market, which can be influenced by economic, political, and global factors.
• Currency Risk: The ST ETF is denominated in Singapore dollars, which means that investors outside of Singapore may be exposed to fluctuations in the value of the Singapore dollar.

Tips and Tricks for Investing in the ST ETF

• Consider Your Investment Horizon: The ST ETF is suitable for long-term investors seeking exposure to the Singapore market.
• Dollar-Cost Averaging: Instead of investing a lump sum upfront, consider investing smaller amounts regularly through dollar-cost averaging to reduce market timing risk.
• Use Limit Orders: When buying or selling the ST ETF, use limit orders to specify a specific price at which you want to execute the trade, providing more control over transaction costs.

How to Step-by-Step Approach for Investing in the ST ETF

1. Open a brokerage account: Select a reputable brokerage firm that offers access to the Singapore Exchange.
2. Fund your account: Transfer funds to your brokerage account to cover the purchase price of the ST ETF.
3. Place an order: Enter the ticker symbol of the ST ETF (STI) and the desired number of units or shares you want to purchase.
4. Monitor your investment: Regularly track the performance of the ST ETF and make adjustments to your investment strategy as needed.

Conclusion

The SPDR® Straits Times Index ETF (ST ETF) is a highly recommended investment vehicle for investors seeking exposure to the Singapore stock market. With its low cost, diversification benefits, and track record of outperformance, the ST ETF offers an attractive option for long-term investors seeking capital growth and income generation.