Singapore Exchange (SGX) has launched the SGX APAC (ex Japan) Dividend Leaders REIT Index, comprising 30 real estate investment trusts (REITs) across the Asia Pacific ex Japan region.
It will be the first SGX index to be used as a benchmark index for a new exchange-traded fund (ETF) and will be issued by Phillip Capital Management, the asset management arm of Phillip Capital.
The index is the first of its kind, composed entirely of REITs in the Asia Pacific region that are dividend weighted, whilst also becoming accessible through an ETF.
The dividend-weighted index measures the performance of REITs that pay the largest dividends within the Asia Pacific ex Japan region, providing investors with the opportunity to participate in a portfolio offering significant and sustainable yields.
Phillip Capital Management’s ETF, which will be listed on SGX, highlights the growing investor interest in ETFs in the region and attests to SGX’s status as the regional hub for REITs.
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ETF Growth in Asia
The region’s ETF market is fast developing and poised for strong growth, with ETF assets in Asia estimated to reach US$560 billion by 2021.
Loh Boon Chye, CEO of SGX, commented: “I am delighted with the launch of our first Pan-Asian index and that it will be used as a benchmark for an ETF. As SGX’s first truly regional index, it broadens our offering beyond the Singapore equity market, demonstrating our continued push to provide investors access to diverse opportunities.”
The SGX APAC ex Japan Dividend Leaders REIT Index captures over 70% of the region’s REIT universe by total capitalisation, taking into consideration size, free-float and liquidity. All constituent weights are capped at 10% to ensure greater portfolio diversification.
New Chairman of the Board
In a separate announcement today, the Directors of SGX announced the election of Kwa Chong Seng who will succeed Chew Choon Seng as Chairman of the Board.
Chew will be retiring at the conclusion of SGX’s AGM on 22 September 2016, and will not be standing for re-election.
Kwa was elected to the Board in September 2012 and was appointed the Lead Independent Director in December 2013. He has been the Chairman of both the Nominating & Governance and the Remuneration & Staff Development Committees since September 2013.