Singapore's Stock Exchange Rolls Out New Asia Real Estate Index

Tom Burroughes

30 August 2016

Singapore's stock market has launched a real estate investment trust index that tracks Asian REITS - excluding those in Japan - designed to be the basis for a forthcoming exchange traded fund.

The Singapore Exchange has launched the SGX APAC ex Japan Dividend Leaders REIT Index, composed of 30 REITs. The index will be a benchmark for an ETF to be issued by Phillip Capital Management, the asset management arm of Phillip Capital.

The index is made up of REITs that are dividend weighted; it 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. The index’s total return over the twelve months to 29 July 2016 was 19.97 per cent, demonstrating a yield over the same period of 4.53 per cent, SGX said in a statement yesterday.

The index captures more than 70 per cent of the region’s REIT universe by total capitalisation, taking into consideration size, free-float and liquidity. All constituent weights are capped at 10 per cent with the aim of greater portfolio diversification.

The ETF of Phillip Capital Management will be listed on SGX.