STOXX Ltd., the operator of Deutsche Boerse Group’s index business, and a global provider of innovative and tradable index concepts, today announced that an ETF based on the STOXX ASEAN Select Dividend 30 Index has been tradeable on the Singapore Stock Exchange (SGX) since Tuesday.
The index is licensed to One AM, Thailand’s largest equity ETF issuer and leading asset management company wholly owned by KGI Securities (Thailand) PLC.
Dividend investing has become an important source of yield in this low interest rate environment. The STOXX ASEAN Select Dividend 30 Index allows market participants to invest in companies with high dividend payouts from six member states of the Association of Southeast Asian Nations, a high growth region. It is the first time ever that an ASEAN dividend ETF has been issued. We are delighted that ONE AM has chosen this innovative smart-beta strategy index to mark their first ETF listing under the ASEAN collection fund scheme (CIS) in Singapore,” said Matteo Andreetto, chief executive officer, STOXX Limited.
We are immensely proud to be Thailand’s first smart beta ETF issuer in the ASEAN region on the Singapore Exchange; with our appreciation extending to all our partners who have been involved in making this landmark deal successful, especially STOXX Limited who helped to construct such an innovative smart-beta strategy, together with a benchmark that forms the basis of ASEAN investing going forward. As one of the fastest growing regions in the world, the ASEAN economies are catching a lot of attention globally hence we are creating here a direct access to a diversified portfolio of high dividend paying ASEAN stocks under one roof for all investors worldwide,” added Pote Harinasuta, chief executive officer, ONE Asset Management Limited.
Chew Sutat, Head of Equities and Fixed Income, SGX, commented:
We welcome this ETF with a dividend strategy index as underlying listed on SGX, and thank OneAM for choosing Singapore as its sole listing destination, providing our investors a product to invest in ASEAN’s economic growth, at the same time enjoy stable returns from its income-investing strategy. This is a timely listing that provides investors with a convenient and low-cost access to the growing popularity of smart-beta investment strategies.
The STOXX ASEAN Select Dividend 30 Index is derived from the STOXX Asia Total Market Index (TMI). It selects the top 30 companies from six ASEAN countries based on dividend yield. The selection is made annually in March and excludes companies with low tradability and poor dividend sustainability. The number of constituents from each country is limited, preventing any one country from dominating the index.
The index excludes companies whose three-month average daily traded volume (ADTV) is less than 2 million US dollars, whose payout ratios are higher than 80%, whose foreign investment capacity is below 4% and those that are Real Estate Investment Trusts (REITs). In order to retain turnover, a 20-40 buffer rule is applied when reviewing the index.
Components are weighted equally. The index is reviewed quarterly and Thailand is subject to a 15% cap. The indices are calculated in price, net and gross return versions for euro and US dollars.