STI ETF

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zoneguard

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revhappy

revhappy

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zoneguard said:
In my view, State Street seems to be doing a worst job compared to Nikko AM.
https://www.dividends.sg/view/G3B
https://www.dividends.sg/view/ES3

From July 2020 to Jan 2021, G3B distributed 0.1213. ES3 distributed 0.099 from Aug 2020 to Feb 2021. Difference of 0.0223.

ES3's AUM increased in 2020 but dividends distributed declined...
Click to expand...

This is wrong way of looking at it. You are comparing different periods and companies in the index distribute dividends on a particular date and since you are comparing different periods, you are not comparing exactly the same amount of dividends.
 
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Kojo0403

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revhappy said:
This is wrong way of looking at it. You are comparing different periods and companies in the index distribute dividends on a particular date and since you are comparing different periods, you are not comparing exactly the same amount of dividends.
Click to expand...

i guess it depends on their dividend policy. Do they pay out 100% of dividend they receive from the companies? or 90% etc.End of the day, the more dividend they pay our, the bigger the impact on the fund NAV at ex-div day.

No doubt most sti investors would prefer to receive higher income during payout. But one has to bear in mind that end of the day, total return is still what it matters.

Another point to note is that AUM of ES3 has grew from $1billion in June to $1.6billion in Jan.
Hence the $600M of new inflows that came in during this period is unlikely to generate dividend over each of the last 6months. E.g. if 300M came in during Nov and Dec, that is likely to generate dividend for only 3 months.

ok maybe not $600M inflows since ES3 also appreciated during this period. closer number is perhaps $400M.

In any case, it’s simpler to just measure it’s performance against total return of STI Index itself.
 
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MangoTuna65

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Kojo0403 said:
i guess it depends on their dividend policy. Do they pay out 100% of dividend they receive from the companies? or 90% etc.End of the day, the more dividend they pay our, the bigger the impact on the fund NAV at ex-div day.

No doubt most sti investors would prefer to receive higher income during payout. But one has to bear in mind that end of the day, total return is still what it matters.

Another point to note is that AUM of ES3 has grew from $1billion in June to $1.6billion in Jan.
Hence the $600M of new inflows that came in during this period is unlikely to generate dividend over each of the last 6months. E.g. if 300M came in during Nov and Dec, that is likely to generate dividend for only 3 months.

ok maybe not $600M inflows since ES3 also appreciated during this period. closer number is perhaps $400M.

In any case, it’s simpler to just measure it’s performance against total return of STI Index itself.
Click to expand...

Wa if you say total return, it will make alot of people even sadder, because our STI is still in the red since covid ...
 
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Kojo0403

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MangoTuna65 said:
Yea, but it's 2.7% annualized now hahaha
Click to expand...
it got to do with the recent inflow into the ETF.

Give your an extreme example. In July, STI ETF has $100M in AUM. December there was an inflow of $1.billion.
The $100M that was there since July had 6 months to accumulate its dividend to pay off at end of 6 months period.
However, the $1billion of inflow that just came in last month, has hardly accumulated dividend, most of it has gone into creation of new sti units with the underlying shares.
Hence coming Feb, the overall cash that can be paid out as investors will be much smaller.

There is no losses or any penalty to those who held it in July. Just that because now the fund has more underlying company shares and less cash, its dividend payable is much lower.

End of the day it’s the total return of the fund that matters.
 
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revhappy

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MangoTuna65 said:
Yea, but it's 2.7% annualized now hahaha
Click to expand...

You are looking at only half yearly dividend right? Maybe more companies payout during the Mar to Jul period? I think we should look at the whole year dividend to arrive at the yield.
 
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revhappy

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Kojo0403 said:
it got to do with the recent inflow into the ETF.

Give your an extreme example. In July, STI ETF has $100M in AUM. December there was an inflow of $1.billion.
The $100M that was there since July had 6 months to accumulate its dividend to pay off at end of 6 months period.
However, the $1billion of inflow that just came in last month, has hardly accumulated dividend, most of it has gone into creation of new sti units with the underlying shares.
Hence coming Feb, the overall cash that can be paid out as investors will be much smaller.

There is no losses or any penalty to those who held it in July. Just that because now the fund has more underlying company shares and less cash, its dividend payable is much lower.

End of the day it’s the total return of the fund that matters.
Click to expand...

This is a very good point. I didn't think about it. Thanks!
 
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MangoTuna65

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revhappy said:
You are looking at only half yearly dividend right? Maybe more companies payout during the Mar to Jul period? I think we should look at the whole year dividend to arrive at the yield.
Click to expand...

Yea but I did annualize it.

Kojo0403's points are v well taken, as you said.
 
revhappy

revhappy

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MangoTuna65 said:
Yea but I did annualize it.

Kojo0403's points are v well taken, as you said.
Click to expand...

I think annualized also is not accurate. Companies could be paying more dividend in the 1st half vs 2nd half of the year, for example.
 
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yuzu28

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So can i say that, assuming selling of sti etf is lesser than buying, the dividend per share may be higher in the long run? Cos these 2 etfs are widely bought by people using rsp...


Kojo0403 said:
it got to do with the recent inflow into the ETF.

Give your an extreme example. In July, STI ETF has $100M in AUM. December there was an inflow of $1.billion.
The $100M that was there since July had 6 months to accumulate its dividend to pay off at end of 6 months period.
However, the $1billion of inflow that just came in last month, has hardly accumulated dividend, most of it has gone into creation of new sti units with the underlying shares.
Hence coming Feb, the overall cash that can be paid out as investors will be much smaller.

There is no losses or any penalty to those who held it in July. Just that because now the fund has more underlying company shares and less cash, its dividend payable is much lower.

End of the day it’s the total return of the fund that matters.
Click to expand...
 
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