Phillip SGD Money Market ETF debuts on SGX

The new listing allows investors to improve fund yield without a liquidation strike.

Singapore Exchange (SGX) has welcomed the listing of Phillip SGD Money Market ETF, the first Singapore-domiciled money market exchange-traded fund (ETF) on SGX, and the only money market ETF in South East Asia.

It started trading with $100m (US$73m) in initial assets under management (AUM).

The new listing is a new treasury and cash management tool for institutional investors as well as a timely alternative investment solution for individual investors to manage their ready cash efficiently.

The listing is managed by Phillip Capital Management, which invests the fund in short term, high quality money market securities and deposits of established institutions to generate returns that are comparable to Singapore dollar savings deposits.

The product tracks closely the performance of the FTSE SGD 3-month Singapore Dollar Swap Offered Rate (SOR) Index, a well-known measure of implied interest rate.

The ETF offers fund managers and brokerage firms an additional liquidity management tool to improve the yield of their clients’ cash deposits, while individual investors can deploy the product as a more efficient management of cash relative to their banks’ savings accounts.

The fund has attracted strong interest from investors with an initial AUM of $100m (US$73m), demonstrating robust demand for the first Singapore-domiciled money market ETF and the only money market ETF in South East Asia.

In a press release, investors are said to be able to improve the yield pick-up of their funds without compromising liquidity and manage their core investments through a single brokerage account. The simplicity of a single account takes away the hassle involved in setting up and managing multiple accounts, and will make a straightforward cash management tool for corporate treasurers and investors.