SGX Market Strategist, Equity & Fixed Income, Singapore Exchange Ltd (SGX)

Geoff Howie

SGX Market Strategist, Equity & Fixed Income

Asia’s leading multi-asset exchange

Singapore Exchange Ltd (SGX)

Singapore Exchange is Asia’s leading and trusted market infrastructure, facilitating the exchange of capital and ideas to create value for people, businesses and economies. As a multi-asset exchange operating equity, fixed income and derivatives markets to the highest regulatory standards, SGX is a vertically integrated business that provides listing, trading, clearing, settlement, depository and data services.

With about 40% of listed companies and over 80% of listed bonds originating outside of Singapore as well as established linkages across the region and in Europe, SGX is Asia’s most international and connected exchange. Offering a full suite of derivatives products across Asian equity indices, commodities and currencies, SGX is the world’s most liquid international market for the benchmark equity indices of China, India, Japan and ASEAN.

As Asia’s pioneering central counterparty, SGX is globally recognised for its risk management and clearing capabilities, and was one of the first globally to adopt the Principles for Financial Market Infrastructure.

Headquartered in AAA-rated Singapore, SGX has over 800 employees including offices in Beijing, Chicago, Hong Kong, London, New York, Mumbai, San Francisco, Shanghai and Tokyo.

Equity Bottom-Up

CapitaLand Ascendas REIT / Equity Bottom-Up

SGX is one of Asia’s regional hub for Real Estate Investment Trusts (REITs) &amp; Property Trusts. Based on the FTSE ST REIT Index, the dividend yield for Singapore REITs have been 4.2 – 6.8% over a period of 5 years (Source: Bloomberg, 2014-2018). Over 80% of Singapore REITs &amp; Property Trusts own offshore assets across Asia Pacific, US &amp; Europe.&nbsp;
As of end Sep 2019, SGX lists 44 REITs &amp; Property Trusts with a combined market capitalisation of over S$100 billion, representing c.12% of Singapore’s overall market
SGX’s REITs &amp; Property Trusts offer wide diversity across property sub-segments REIT Indices:
<ul>
<li>FTSE ST REIT Index: 37 out of the 44 trusts represented</li>
<li>iEdge S-REIT Index: 36 out of the 44 trusts represented</li>
</ul>
<h2>Key Statistics At a Glance</h2>
<ul>
<li>Average dividend yield of 6.2%</li>
<li>Average 3-year annualised total return of 10.8%</li>
<li>Average gearing ratio of 34.5%</li>
<li>10 year market cap CAGR of 22%</li>
</ul>

SGX is one of Asia’s regional hub for Real Estate Investment Trusts (REITs) &amp; Property Trusts. Based on the FTSE ST REIT Index, the dividend yield for Singapore REITs have been 4.2 – 6.8% over a period of 5 years (Source: Bloomberg, 2014-2018). Over 80% of Singapore REITs &amp; Property Trusts own offshore assets across Asia Pacific, US &amp; Europe.&nbsp;
As of end Sep 2019, SGX lists 44 REITs &amp; Property Trusts with a combined market capitalisation of over S$100 billion, representing c.12% of Singapore’s overall market
SGX’s REITs &amp; Property Trusts offer wide diversity across property sub-segments REIT Indices:

FTSE ST REIT Index: 37 out of the 44 trusts represented
iEdge S-REIT Index: 36 out of the 44 trusts represented

Key Statistics At a Glance

Average dividend yield of 6.2%
Average 3-year annualised total return of 10.8%
Average gearing ratio of 34.5%
10 year market cap CAGR of 22%


Chartbook: SREITs & Property Trusts -  October 2019

Partner, River Valley Asset Management

River Valley Asset Management

Partner

Singapore-based boutique asset management firm

River Valley Asset Management is a Singapore-based boutique asset management firm. Our team at RVAM strongly believes in being a trusted steward of our clients' wealth across generations.

Each of our fund managers has years of rich portfolio management experience over multiple market cycles at world-class investment houses. We bring our clients the combined strength of our investment team to manage their financial portfolios and to provide bespoke guidance on all aspects of their financial health.

We offer multi-asset class expert investment advice to accredited investors who are family offices, high net worth individuals and institutional investors to preserve and grow our clients' wealth.

The fund management team of the company includes Homiyar Vasania, Anand Ramachandran and Jamshed Desai.

Thematic (Sector/Industry)

As a mature economy with stable businesses, Singapore's equity benchmarks are dominated by Banks &amp; Government Linked Companies (GLC's) which have grown large over time. The large listed companies in Singapore (private as well as GLC’s) are now facing headwinds from tight labour markets resulting in rising costs and, in the absence of growth, the need to focus on raising productivity.  It is therefore not surprising that the Singapore markets do not excite the average investor. However, within this space we have been finding many hidden gems which have consistently delivered and increasingly fit the needs of a Singaporean investor looking for stable returns in a low growth environment: the REIT marketplace. Over the last seven years the REIT index has delivered over 10% p.a. annualized return which stands in stark contrast to the meagre 4% returns from benchmark STI index.

As a mature economy with stable businesses, Singapore's equity benchmarks are dominated by Banks &amp; Government Linked Companies (GLC's) which have grown large over time. The large listed companies in Singapore (private as well as GLC’s) are now facing headwinds from tight labour markets resulting in rising costs and, in the absence of growth, the need to focus on raising productivity.   It is therefore not surprising that the Singapore markets do not excite the average investor. However, within this space we have been finding many hidden gems which have consistently delivered and increasingly fit the needs of a Singaporean investor looking for stable returns in a low growth environment: the REIT marketplace. Over the last seven years the REIT index has delivered over 10% p.a. annualized return which stands in stark contrast to the meagre 4% returns from benchmark STI index.

Singapore

Fortune REIT is a real estate investment trust that invests in a portfolio of retail shopping malls located in Hong Kong.

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Fortune REIT (778 HK)

Chartbook: SREITs & Property Trusts - October 2019

SGX is one of Asia’s regional hub for Real Estate Investment Trusts (REITs) & Property Trusts. Based on the FTSE ST REIT Index, the dividend...

Singapore Exchange Ltd (SGX)

Singapore - The Hidden Gems

As a mature economy with stable businesses, Singapore's equity benchmarks are dominated by Banks & Government Linked Companies (GLC's) which...

River Valley Asset Management

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