tag:blogger.com,1999:blog-28086856.post5850820762479424493..comments2024-03-20T01:42:13.273+08:00Comments on Eight percent per annum: Value investing in Singapore stocks: Analysing ETFsJayhttp://www.blogger.com/profile/03292158817395898619noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-28086856.post-77101752781039128012012-02-18T08:04:12.810+08:002012-02-18T08:04:12.810+08:00Exchange traded funds are a great financial instru...Exchange traded funds are a great financial instrument but the regulations have not kept pace with the rapidly changing types of exchange traded funds.Dennis The Menacehttp://www.manhattancalumet.comnoreply@blogger.comtag:blogger.com,1999:blog-28086856.post-11670585080459357302009-06-22T18:12:15.243+08:002009-06-22T18:12:15.243+08:00Hi hi
Thanks for the additional points. Didn'...Hi hi<br /><br />Thanks for the additional points. Didn't know about the swaps. Need to think about those too.<br /><br />On the STI ETF not matching the index, I think it's better to look at the NAV of the ETF instead of its listed price. Due to a lot technicality involved, I don't think it's easy to make an ETF that has the same dollar price as the index.<br /><br />Like the HSCEI and the HSI, the ETFs are $13+ and $2+ but the indices are 10,000+ and 18,000+, totally no relationship.<br /><br />But the NAV is never a prominent no. Need to look at the prospectus or the ETF website to find out, I guess.Jayhttps://www.blogger.com/profile/03292158817395898619noreply@blogger.comtag:blogger.com,1999:blog-28086856.post-75007520011575022742009-05-29T12:30:13.202+08:002009-05-29T12:30:13.202+08:00A few further points to note:
1. Many of the SGX ...A few further points to note:<br /><br />1. Many of the SGX listed ETFs (especially the newer ones) can invest in up to 10% in swaps. This represents a counterparty risk unlike traditional fund-based ETF<br /><br />2. The expense ratio is not the true expense of the fund. The counterparty in the swap could achieve a lower tax rate depending on the local jurisdiction and able even to reduce the expense ratio through lower tax rate. On an extreme case, the fund could even outperform the index because the index is computed based on the worst case withholding tax.<br /><br />Personally I suggest stay away from swap-based ETFs. Afterall, there are many good ETFs listed in European countries which is easily investable through Internet. But do watch out for these swap based ETFs which seem to be very popular in Europe also.Wilfredhttps://www.blogger.com/profile/02499593678517115870noreply@blogger.comtag:blogger.com,1999:blog-28086856.post-27031236339615442692009-05-29T09:33:12.908+08:002009-05-29T09:33:12.908+08:00Hi,
Some points on your article.
1) My guess is ...Hi,<br /><br />Some points on your article.<br /><br />1) My guess is that the ETF which is playing market maker, has higher spread and higher management fees (for example, the Lyxor Nifty fee is 0.85% vs 0.3% for STI ETF)<br /><br />2) I also noticed that other than the bid-ask spread, a funny thing is that the costs are actually higher than you see. For example, the STI is at 2307, so the ETF should be at 2.307, but it is sold at 2.36, looks small, but that is a 2.3% difference<br /><br />3) On your point on whether you can sell after 10 years, as long as you have a market maker, you do not have to worry as they have to give you a bid or extinguish the units and return the money. No chance of returning the money as they make a free 0.3 to 0.8% for holding your money<br /><br />Hope this helps<br /><br />VAnonymousnoreply@blogger.com