Singapore Exchange to launch exchange-traded funds

Asian Economic News, May 7, 2001

SINGAPORE, May 3 Kyodo

Five exchange-traded funds (ETFs) listed on the American Stock Exchange (Amex) will be listed and traded on the Singapore Exchange from Friday, Singapore Exchange and Amex jointly announced Thursday.

The Singapore Exchange and Amex signed an agreement in June last year to establish a joint venture to list and trade ETFs, which are indexed funds that trade the performance of a specific stock index or baskets of stocks in a specific sector.

The earlier plan was to trade nine products.

Singapore Exchange officials denied that the number was reduced due to the cool reception on the first day of the launch of two Amex-listed ETF's in Hong Kong on Wednesday.

In a statement issued Thursday, the Singapore Exchange said it decided to only ''launch five of the most popular and well-traded Amex ETF'' products in Singapore after consultations with the local brokering community

The products to be listed on the main board of the Singapore Exchange are S&P 500 SPDRs, DJIA DIAMONDS, iShares S&P 500 Index Fund, ishares MSCI Singapore Index Fund and ishares Dow Jones U.S. Technology Sector Index Fund.

''We want to focus on educating the community in Singapore and give the product the best possible opportunity to be successful,'' Singapore Exchange chief executive officer Thomas Kloet told a news conference.

''As the market continues to develop, we will continue to introduce more products.''

The launch in Singapore marks the first time that ETFs will be traded across the North American and Asian time zones.

On Wednesday, the Hong Kong Exchanges and Clearing began trading the iShares MSCI South Korea Index and ishares MSCI Taiwan Index, but the two ETFs attracted a total of only 21 transactions.

News reports have hinted that the Hong Kong exchange rushed to launch the two ETFs due to rivalry with Singapore as both countries are striving to become Asia's financial center after Tokyo.