SGX and Thomson Reuters launch SGD bond indices

New tool for benchmarking investment performance.

Singapore Exchange (SGX) and Thomson Reuters announced the launch of a suite of Singapore dollar (SGD) bond indices designed to meet the needs of fund managers, asset owners and custodians in benchmarking investment performances.

"The new index series is the only complete government, statutory board and corporate bond index series to provide five years of historical data," the exchange and company said in a joint release.

"This offers market participants a powerful barometer of fixed income returns across a multitude of segments," they added.

The Thomson Reuters/SGX Singapore Fixed Income indices are based on bonds priced objectively and independently by the Thomson Reuters Evaluated Pricing Service, a time-specific assessment of the fair market value of each bond.

SGX and Thomson Reuters said this method will provide better indicative prices as compared to composite or contributed prices that may be out of date. They said it will also make these indices ideal for the creation of index-based investment products such as Exchange Traded Funds which seek to provide specific investment access to Singapore debt.

“Asian companies are listing a record amount of bonds on Singapore Exchange and we are the listing venue of choice for any fixed income deals that take place in Asia”, said Muthukrishnan Ramaswami, President of SGX. “With the launch of the bond indices we aim to increase transparency and improve the price discovery process for investors. This is another key milestone for both retail and institutional investors seeking diversified multi-asset exposure through the Singapore market.”

The Singapore bond market has grown exponentially in the last 10 years, with primary issuance of corporate bonds hitting a record volume of S$26 billion in 2012. The depth of growth has been accompanied by the broadening of the market, with foreign issuers, high-yield issuers and new debt instruments adding to the diversity of the market, bolstering the Singapore government’s goal of being a regional bond centre.

“With continued interest in the Singapore fixed income market and growing demand for local index products for benchmarking, we are delighted to strengthen our relationship with SGX,” said Sanjeev Chatrath, managing director, Region Head - Asia, Financial & Risk at Thomson Reuters. “Across the global markets in which Thomson Reuters operates, we continue to work closely with market participants to offer representative benchmarks that serve to connect and empower the financial community. The launch of this index series in Singapore is just another step in demonstrating our commitment to developing financial markets in the Asia-Pacific region.”

The indices will be available on Thomson Reuters Eikon, the company’s intuitive next-generation solution for consuming real-time and historical data, connecting with the financial markets community and executing financial markets transactions. Index levels will also be available for free to Datastream customers and constituent information will be distributed via various industry standard feeds and ftp formats.