Exchange Traded Fund

Many big companies died throughout the history. While the index like Dow Jones is still there, like a man still in his young age. That's the charm of a fund that tracks the index. An index tracking fund gives you confident that it is safe while it has potential to appreciate over years.

Here in Singapore we have only one "Exchange Traded Fund" that tracks STI. The fund buys in STI component stocks in appropriate weight. It makes best effort to track the STI. In my opinion, it outperformed the STI since its incubation in 2002. For example, the STI on 13/01/06 was 2405 while the Net Value per unit of STI-ETF was $24.87.

The exchange traded fund has another pro than normal fund: its liquidity. It can be traded on any day that SGX opens for share trading. Normal fund will be redeemable only twice per month.