Last updated on 18 de March de 2023
Singapore is a small but prosperous economy in Southeast Asia. A true financial center, we analyze the 2 most important stock market indexes of Singapore.
With less than 6 million people, there is no doubt that Singapore is a small country. Nevertheless, it is one of the most important financial centers in the world and a true haven for global capital.
Singapore’s economic development since the middle of the 20th have been remarkable. In just half a century, Singapore went from being a third-world country to the Asian version of Switzerland.
Singapore is a country with very strong rule of law, property rights, economic freedom, stability, and attractive taxation. For all these reasons, it attracts a lot of capital from international investors.
While investing in Singaporean real estate is very expensive from a tax perspective, investing in its stock market is a lot more tax efficient. Singapore is one of the few countries who does not apply any withholding taxes to the dividends paid by its domestic companies.
For those who want to invest passively in Singapore, we analyze its two most important stock market indexes:
The Straits Times is the most famous stock market index in Singapore. It is also one of the oldest stock indexes in Asia, being in existence since 1966.
The Straits Times is an index calculated jointly by the Singapore Stock Exchange, the Singapore Press Holdings media group and FTSE Russell, a subsidiary of the London Stock Exchange that calculates financial market indexes.
In it we can find 30 of the largest listed companies in Singapore, weighted by their market capitalization. As a result, the larger ones tend to dominate the movements of the index.
The two sectors with the largest weights in the Straits Times stock index are finance and real estate. This should not surprise us, since Singapore is a small country, whose economy is very much focused on financial services and real estate development.
If you want to learn additional details about this index, here is the link to the official website of the Singapore Stock Exchange.
The other stock market index that may be interesting for us if we want to invest in Singapore passively is the MSCI Singapore. It is calculated by the US company MSCI.
The MSCI Singapore index includes all Singaporean stocks that are part of the global MSCI World Index.
Due to the eligibility criteria of this index, the number of shares fluctuates over time, depending on how many companies meet those criteria. As a general rule, it is composed by between 15 and 20 companies.
Just as in the Straits Times index, the economic sectors that dominate the MSCI Singapore are real estate and financials.
For additional details on this index, you can visit MSCI’s official website.
I hope you found this little analysis of Singapore’s stock market indexes useful, and encourage you to subscribe to my newsletter:
And if you are interested in the stock market index of another haven for global capital, check out this link
Switzerland’s Top 4 Stock Market Indices