Monday, August 29, 2016


Fresh off the press is the SGX Asia Pacific ex Japan Dividend Leaders REIT Index (see here). A REIT ETF, based on that index, will be issued by Philip Capital (see here).

As an income investor, I'm glad for this development. If you compare the proposed REIT ETF with any one of our individual REITs, the yield is a bit on the low side (4.53% over the last 12 months).

Of the top 10 constituents, only 2 belongs to Singapore (Ascendas and CapitaMall). With the exception of the Link REIT from Hong Kong, the remaining 7 are Australian REITs. As the ETF will consist of 30 members, I was curious as to who the other constituents are. However, I was not able to find the information on SGX's site. The information is now available here.

The ETF will be reviewed semi-annually in March and September.

I will most probably deploy my cash into the ETF in tranches. While the PE ratio of 10.91 seems acceptable, the total returns for the Index have since ran up quite a fair bit. I have to remind myself that I should be looking at total return instead of yield on cost. If I purchase at too high a price, I would definitely lose out once the price corrects. A safer approach is to enter after a correction, benefiting from both a price appreciation and dividend yield (total return).

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