Singapore Exchange Launches Asia First International REIT Futures
10th August 2020 | Singapore
Singapore Exchange (SGX) is launching Asia first international REIT futures, 2 REIT futures that track REITS listed in Singapore, Hong Kong, Malaysia and Thailand. (REIT is the acronym for Real Estate Investment Trust, and is an investment fund or company that invest into income generating real estate.)
” Singapore Exchange Launches Asia First International REIT Futures “
2 REIT Futures Launching on 24/8/20
The 2 REIT futures to be launched on the 24th August 2020 are the SGX FTSE EPRA Nareit Asia ex-Japan Index Futures and the SGX iEdge S-REIT Leaders Index Futures.
- SGX FTSE EPRA Nareit Asia ex-Japan Index Futures
- SGX iEdge S-REIT Leaders Index Futures
FTSE EPRA Nareit Global Real Estate Index
The FTSE EPRA Nareit Global Real Estate Index series is a widely followed global benchmark, with an estimated $340 billion of assets under management actively benchmarked or passively tracking the indices. The index is designed to track the performance of REITS in both developed and emerging markets.
The European Public Real Estate Association (EPRA) is a common interest group, which aims to promote, develop and represent the European public real estate sector.
The National Association of Real Estate Investment Trusts® (Nareit) is the trade association for REITs and publicly traded real estate companies with an interest in the US property and investment markets.
FTSE Russell is a leading global provider of indexes with more than $15 trillion benchmarked to FTSE Russell Indexes. FTSE Russell is 100% owned by the London Stock Exchange Group.
iEdge S-REIT Leaders Index
The iEdge S-REIT Leaders Index is the most liquid index-basket representation of the Singapore REIT (SREIT) market and one of the most widely referenced in SGX’s suite of indices.
Both futures are designed in accordance with Commodity Futures Trading Commission guidelines, which would allow broad distribution to US and global institutional investors.
Singapore, the REIT Hub of the World
According to SGX, Singapore is the largest REIT market in Asia ex-Japan, with 44 REITs and property trusts with a combined market capitalisation of S$98 billion. The market capitalisation of SREITs and property trusts has grown at a compounded annual growth rate of 15% in the last 10 years. Compared to other asset classes, they offer one of the highest dividend yields and lower volatility, with average dividend yield of 7.1%.
In 2019, close to 45% of REIT IPOs worldwide debuted on SGX, surpassing the largest REIT markets of US, Australia and Japan. Singapore is one of the largest global REIT hubs in the world, where over 80% of the REITs hold overseas assets, spread across geographies and sub-sectors.
Michael Syn, Head of Equities at SGX:
“We continue to broaden our Singapore franchise with innovative products that capitalise on the strengths of our cash equities and equity derivatives businesses. Singapore is the REITs growth capital of Asia, attracting global institutional investors looking for defensive returns, particularly in today’s volatile markets and low interest rate environment.
Over the past 18 years since the first REIT listing on SGX, we have established a strong REIT ecosystem with increasing investor interest, deep liquidity and active issuer participation. SGX offers a comprehensive product suite, ranging from stocks, REIT ETFs – and now REIT futures – to meet increasing customer demand.”
About Singapore Exchange
Singapore Exchange is Asia’s leading and trusted market infrastructure, operating equity, fixedincome, currencies and commodities markets to the highest regulatory standards. As Asia’s most international, multi-asset exchange, SGX provides listing, trading, clearing, settlement, depository and data services, with about 40% of listed companies and over 80% of listed bonds originating outside of Singapore.
SGX is the world’s most liquid international market for the benchmark equity indices of China, India, Japan and ASEAN and offers commodities and currency derivatives products. Headquartered in AAA- rated Singapore, SGX is globally recognised for its risk management and clearing capabilities.
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