DBS Asset Management has launched the DBS Singapore STI ETF, which will be listed on the Singapore Exchange (SGX) on February 25. The DBS Singapore STI ETF will be the first of a series of new SGX-listed exchange-traded funds (ETF) to be offered by DBS AM.
The new fund seeks to track the performance of the Straits Times Index, which is made up of 30 of the largest and most liquid companies in Singapore. The ETF is aimed at investors with a medium-term investment horizon and optimistic about Singapore's financial position.
"It is in challenging times like these that investors should focus their attention on the true nature of long-term wealth management - low-cost, effective and liquid access to opportunities for compounding growth in investments," says Deborah Ho, CEO of DBS AM.
The initial offer period of the DBS Singapore STI ETF is from February 12 to 18.
The launch follows a memorandum of understanding between DBS AM and SGX with the intention of developing a suite of ETF products dealing with a variety of Asian stock market indices and their underlying assets. The alliance aims to establish Singapore as Asia's regional investment and wealth management gateway by jointly developing, promoting and distributing SGX-listed ETF products.
DBS AM executives familiar with the ETF were not available to comment on future plans related to the ETF series. The fund house already has an ETF, the ABF Singapore Bond Index Fund, which was launched and listed on the SGX in August 2005.
ETFs have no sales fee and generally charge less than 1% for management fees, enabling investors to obtain cost-efficient exposure to a diversified portfolio of securities through a single transaction.
With the launch of this ETF, the SGX will have 25 ETFs covering mainly Asian equity markets such as Singapore, India, Greater China, Asean, Korea and Japan as well as commodities, including gold.